AT&T’s recent acquisition of satellite television provider DirecTV for $49 billion, makes it the undisputed leader among the paid-television providers. Earlier, AT&T was the second-largest wireless company after DirectTV.
The Friday’s deal came at the back of an announcement by the Federal Communications Commission that reported that a five-member commission had voted in favour of the merger. Even the Department of Justice supported the merger. Since both federal agencies were apprehensive on the deal, the FCC imposed several conditions on the merger.
As one of the conditions, AT&T agreed to abide by stricter Net neutrality restrictions than were announced the in rules the agency passed in February. This is to ensure that all traffic on the Internet was treated equally. It also aimed to provide better broadband access to low-income families, schools and libraries.
The merger wouldhelp AT&T attain a synergistic advantage, wherein AT&T’s broadband and wireless services have been combined with DirecTV’s nationwide satellite TV service. This would create a powerful package of broadband, entertainment and communications services.
In addition, AT&T would get access to DirecTV’s content deals as well as the ability to deliver those services to everyone across the country. Along with this, DirecTV’s video relationships could become key, as more content is capable of being delivered on mobile devices.
Earlier this year, AT&T closed an acquisition deal for $2.5 billion, thereby acquiring Mexican wireless provider Iusacell, as also the $1.88 billion acquisition of mobile operator Nextel Mexico.