Big Deal: AT&T Reportedly In Talks To Acquire Satellite Operator DirecTV
DirecTV's satellite service is home to around 20 million customers, with another 5.7 million signed up for AT&T's TV service. If the two firms agreed on a deal and were allowed to merge, their combined subscribers would be in striking distance of where Comcast is headed with its Time Warner Cable deal, which would give the firm nearly 30 million subscribers.
Both AT&T and DirecTV are keeping mum on any talks that might be taking place. As of right now, any and all information is originating from The Wall Street Journal, which is supposedly being kept in the loop by "people familiar with the situation."
There are multiple reasons why DirecTV might consider a deal like this, or at least be open to hearing a pitch. For one, the satellite business is no longer growing like it once was -- DirecTV's subscriber growth in the U.S. has fallen each year since 2010. Secondly, DirecTV doesn't offer Internet service, which even if it did, satellite Internet typically pales in comparison to cable and DSL in speed and price.
AT&T's interest in the deal could be a reactionary one to Comcast's attempt to purchase TWC. According to WSJ, there's been speculation that AT&T has been interested in getting into the satellite game for a number of years now, and with the stars seemingly aligned, now might be the time to pounce.
It should also be pointed out that AT&T and DirecTV already have a working relationship in some areas. The two have partnered up to bundle DirecTV's satellite service and AT&T's broadband Internet in areas where U-verse television isn't an option.