See ya, Comcast - there's a new paid television king in town and its name is AT&T. This week, AT&T and DirecTV's $48.5 billion merger was approved by the Federal Communications Commission and Department of Justice. This massive combination will result in the largest television service in the country, as well as an absolute powerhouse in content distribution in general.
As part of the purchase, AT&T will gain access to DirecTV's content contracts, most notably DirecTV's expensive exclusive NFL Sunday Ticket, the driving force behind the service's sales numbers. AT&T will also gain access to the company's satellite network and a major expansion of the AT&T television brand, which is currently only available in a few states. AT&T CEO Randall Stephenson said of the merger,
We're now a fundamentally different company with a diversified set of capabilities and businesses that set us apart from the competition.
This comes at a time when the wireless industry has become more interested in content, and content companies have become more interested in wireless. Verizon recently purchased AOL, giving them ownership of brands like Engadget and Huffington Post, while DISH Network has been in talks to purchase T-Mobile USA, which would result in the same concept.
As part of this deal's approval, AT&T agreed to Net Neutrality rules stricter than current regulations layout. As far as the FCC is concerned, this is a big win for their expanding power-grab, as AT&T has been one of the loudest opponents to even the existing regulations. This does not mean they won't continue to fight against the legality of the FCC issuing these regulations, or requiring this agreement for the merger, but for now it does give the FCC a little more ground to stand on.
In addition, AT&T agreed to expand its fiber service, something Verizon has ended not once but twice. The company had proposed the fiber agreement themselves, with the 12.5 million customer count being just slightly larger than their existing build-out plans currently called for. They will also work with low income families to provide more affordable services.