AT&T Promises Higher Speeds with DirecTV as Lawmakers Look into Merger
AT&T made its case for acquiring DirecTV at the recent Goldman Sachs' Communacopia conference Friday, saying that it will be able to offer the kind of speeds the FCC is looking for.
Speaking at the conference, AT&T Mobility president and CEO Ralph de la Vega said that if AT&T and DirecTV were allowed to combine, the new company could deliver wireless broadband speeds of up to 15Mbps, Variety reports.
"We think the video opportunity is huge," de la Vega said. "We see a very bright outlook (for pay TV). ... That's why we did the DirecTV deal."
Vega also said that AT&T has the technology in place to rollout a combined TV-broadband package with DirecTV that would involve using one satellite dish in a home to provide both.
AT&T's proclamation of 15Mbps speeds comes soon after FCC Chairman Tom Wheeler delivered a speech on "The Facts and Future of Broadband," where he cited a public goal of 25Mbps. Wheeler's comments were directed at the ongoing consolidation efforts in the telecomm industry and the chairman was insistent on competition being the key factor in driving growth and expanding access.
AT&T revealed earlier in May that it plans on buying DirecTV, the largest satellite-TV provider in the United States, for $48.5 billion. The deal seemed to be sailing clear for a while, with AT&T and lawmakers agreeing on conditions in late August.
Regulatory scrutiny is still high, however, as Reuters' reports states previously investigating the Comcast-Time Warner Cable merger have now expanded their efforts to include the AT&T-DirecTV deal as well. Among the states involved are California and New York, two states critical of Comcast and Time Warner's proposition.
Although details are still scant on the investigation, AT&T spokesman Michael Balmoris told Reuters, "We look forward to discussions with these state attorneys generals on the significant consumer benefits created by this merger."
For the most part, the deal looks like it will go through, although there are still a couple solid arguments AT&T and DirecTV will need to make to federal authorities. The main hurdle will be to convince Washington that the loss of competition between AT&T's U-Verse TV service and DirecTV's satellite TV won't necessarily stifle innovation or the companies' efforts to expand efficiently. Regulators are also worried that a combined AT&T and DirecTV would wield too much influence over content distribution and costs. AT&T, however, doesn't see it that way.
"This is not Comcast/Time Warner, this is not two cable companies getting together, this is not Sprint and T-Mobile," AT&T CEO and Chairman Randall Stephenson told a House Judiciary Committee panel in June.
"We're putting (DirecTV's satellite) TV product with our broadband wireless product. ... There is not a content player per se in this transaction."
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