AT&T announced yesterday that the company will buy DirecTV for $48.5 billion USD, shaking up the pay-for-TV landscape.
Both boards of directors at the two companies agreed to the deal, with AT&T purchasing DirecTV in a stock-and-cash transaction for $95 USD per share. DirecTV has exclusive rights to NFL Sunday Ticket, as well as minority stakes in the Game Show Network, MLB Network, NHL Network, and the Sundance Channel.
“This is a unique opportunity that will redefine the video entertainment industry and create a company able to offer new bundles and deliver content to consumers across multiple screens — mobile devices, TVs, laptops, cars and even airplanes," said Randall Stephenson, AT&T chairman and CEO. "... DIRECTV is the best option for us because they have the premier brand in pay TV, the best content relationships, and a fast-growing Latin American business."
AT&T's Uverse TV service reportedly has roughly 5.7 million subscribers in the United States, while DirecTV has around 20 million — plus an alleged 18 million more subscriptions in Latin America. Upon closing the deal, AT&T says that it will expand high-speed broadband service to 15 million more consumers. In addition, DirecTV's standalone service will continue being available at nationwide package pricing for at least three years after the deal goes through.
The AT&T acquisition is just the latest in big shakeups for the pay-TV industry, as earlier this year, Comcast and Time Warner announced a merger plan for around $45 billion USD. Both agreements, however, could face regulatory roadblocks, as criticism grows for the lack of consumer options.
