The FCC approved AT&T’s merger with DirecTV today. The regulator signed off on the $48 billion transaction and placed conditions on the deal after considering it for more than a year. The Department of Justice has already said it does not intend to challenge the merger on competition grounds
AT&T’s proposed $48.5 billion purchase of DirecTV has cleared its final regulatory hurdle as the FCC voted on Thursday to approve the merger, according to people familiar with the votes.
FCC Chairman Tom Wheeler is recommending approval of AT&T’s $48.5 billion acquisition of DirecTV, a deal that would combine the country’s second-biggest wireless company with its biggest satellite TV provider, according to sources close to the deal. The FCC’s move represents a significant victory for AT&T, which failed to win regulatory approval in 2011 for its $39 billion deal to acquire T-Mobile, the nation’s third-largest wireless carrier. The agency is expected to formally OK the transaction within weeks.
A group of 27 small cable operators in 12 states is pressing the FCC to place conditions on the AT&T-DirecTV merger to prevent the combined company from crushing smaller cable operators with higher sports fees.
Affiliates of ABC, CBS, NBC and Fox, are asking the FCC to condition its approval of the AT&T-DirecTV merger on DirecTV carrying local TV stations in all 210 local markets. Currently, the satellite operator does not carry the stations in 11 markets.
The AT&T-DirecTV deal has largely avoided scrutiny while a proposed Comcast-Time Warner Cable merger was in the works. That’s changed now.
Exclusives
The FCC on Friday officially stopped its so-called “shot clock” on its reviews of Comcast’s proposed $45-billion takeover of Time Warner Cable, as well as the agency’s separate review of AT&T’s bid to take over DirecTV. Both were scheduled to expire in late March.
AT&T has said very little about its plans for DirecTV, the satellite broadcaster it agreed to acquire in May for $48.5 billion. Now one plan has trickled out: it may scrap the brand name.
The trade group filed a motion to intervene Monday with the U.S. Court of Appeals for the District of Columbia Circuit regarding broadcasters’ petition seeking to block the FCC from forcing the disclosure of “highly confidential broadcaster distribution agreements and related negotiation strategies.” ACA argues for third-party acces to such documents.
Companies including Walt Disney, CBS and Viacom have asked the D.C. Circuit Court of Appeals to step in and block an FCC decision that would forcethem to reveal the terms of their business deals. Those deals are part of the public review of Comcast’s $45 billion bid to buy Time Warner Cable and AT&T’s $48 billion plan to buy DirecTV.
The FCC has delayed its review of Comcast’s proposed $45 billion merger with Time Warner Cable — which, if approved, would greatly increase Comcast’s broadband footprint. The FCC is also suspending its review of AT&T’s proposed merger with DirecTV. The agency said it suspended the informal 180-day countdown clocks because nine content companies — including CBS, Fox, Time Warner and Disney — refused to disclose key information about their deals with cable providers.
AT&T is not used to flying under the radar, but that is exactly what is happening in Washington with the company’s $48.5 billion bid to buy DirecTV. A deal that would combine the nation’s biggest telephone company and the nation’s biggest satellite TV provider seems like it would generate a lot of noise from public interest groups because it eliminates a major player in the pay TV marketplace. But instead, critics of industry consolidation are focusing on Comcast’s $45 billion play for Time Warner Cable.
Critics of AT&T’s proposed $49 billion merger with DirecTV filed formal comments with the FCC to block the plan. The NAB urged the FCC to impose conditions to boost local television content. For instance, DirecTV should be required to offer local broadcast stations in all the 210 markets where it operated, the broadcaster group said.
Sen. Dean Heller (R., Nev.) in a letter to FCC Chairman Tom Wheeler requested information regarding any confidential meetings the agency has had with media companies as part of its regulatory review of proposed acquisitions of pay-television companies Time Warner Cable by Comcast Corp. and DirecTV by AT&T, The Wall Street Journal reports. WSJ subscribers can read the full story here.
AT&T Inc’s proposed merger with DirecTV does not compare with other mergers shaking up the telecommunications industry because the companies largely provide different services, AT&T’s chief executive told lawmakers on Tuesday.
In a statement to the FCC, the firm says without the $48.5 billion deal neither company can compete against rival cable giants.
AT&T said in a regulatory filing Tuesday that the DirecTV deal would enable it to upgrade 2 million additional locations to “Gigapower” fiber connections, and expand high-speed broadband coverage overall to 13 million locations.
Less than two weeks after AT&T and DirecTV sealed their $48 billion-plus tie-up, a shareholder has filed a class action objecting to the deal. The suit, filed Thursday in Los Angeles Superior Court, names as defendants AT&T, the satcaster and its board members, including former CBS honcho Peter Lund and ex-Fox Networks Group chief Tony Vinciquerra.
Just last month the telco announced that it forged a partnership with former News Corp. COO Peter Chernin, valued at $500 million, to either buy or build a so-called over-the-top online video service. That’s now potentially the biggest — and perhaps the only meaningful — new opportunity for AT&T if it completes its $49.5 billion acquisition of DirecTV.
