AT&T, the number two wireless carrier, has just become the biggest traditional television provider in the United States with its $48.5 billion purchase of DirecTV, the biggest satellite-TV provider. This is all after winning clearance from the Federal Communications Commission. This deal was sealed on Friday.
JUSTICE DEPARTMENT CLEARED DEAL TUESDAY
The Justice Department had already cleared the deal on Tuesday of this past week, which creates the largest provider of cable or satellite TV in the United States, with 26.4 million cable and satellite TV subscribers. That is more than Comcast, the United States’ biggest cable company, as well as Charter, which is also seeking government approval to buy Time Warner Cable. This company said that it will serve more than 26 million United States customers and more than 19 million in Latin America.
FCC REVIEWS FOR THE PUBLIC’S INTEREST
The requirements from the FCC, which ensures that deals are in the interest of the public, include protections for rival video and pledges to expand high-speed Internet services to low-income Americans, schools and other customers. After more than a year of review, the Federal Communications Commission finalized its vote to approve the deal with conditions that will be imposed for four years and enforced by an internal and external compliance officers. The conditions imposed by the FCC address potential harms presented by the combination. This conditionals also ensure that the benefits of the merger will also be realized.
Suppliers of TV are buying one another as video from Internet competitors like Netflix gets more popular and costs rise for channels. Adding TV customers gives AT&T more room to negotiate with big media companies over price for those same channels.
AT&T WILL BE RELEASING NEW TV, INTERNET, AND MOBILE DEALS SOON
The deals also combine as a nationwide satellite TV service with a nationwide wireless network as the amount of time that is spent on mobile devices increases. AT&T says that it will also launch new TV, Internet, and mobile phone bundles in the next coming weeks.
With this merger, DirecTV receives the broadband product it previously didn’t have and AT&T gets new avenues of growth beyond the maturing wireless service. AT&T’s shares were up 1.1 percent and DirecTV shares were up 1.5 percent at the market close.
