Talking tech since 2003

AT&T may be after a bigger slice of the pay TV market, and it may be looking to the stars to get it.

A Buzzfeed report, based on tips from a source, claims that AT&T plans to acquire satellite TV provider DirecTV for a whopping $50 billion. Not only that, AT&T will reportedly announce the acquisition on Sunday, which is tomorrow.

directvShould this news be true, it would give AT&T two paths into your living room — at least, as far as TV goes. The company already provides pay TV — along with high-speed Internet — through its U-Verse offering, which is currently available in limited regions. Adding DirecTV to the mix would allow AT&T to expand its TV customer base without having to build out expensive infrastructure.

One could argue that many TV providers see the Internet has the future of content delivery — the “channel” that will one day do away with traditional cable — and that’s why they invest in both. It’s why a company like Comcast is in a great position to ride out whatever changes may come — because it’s a TV provider, but it’s also one of the largest Internet providers. And it’s why a move like this might not make sense for AT&T, which doesn’t have a large wired broadband network as a backup plan.

On the other hand, AT&T does have the fastest LTE network in the country, and the second largest wireless subscriber base. If the company wanted to take DirecTV, with all its carriage agreements and content licenses, and somehow transform it into an Internet TV provider (perhaps, with free access for AT&T mobile subscribers?), the acquisition would become a lot more interesting.

It’s something AT&T likely could have built up on its own, but purchasing a company that has all the agreements in place already (and, not to mention, a decent satellite TV business) would save a lot of time and allow AT&T to strike more quickly.

I suppose we don’t have too long to wait if the official announcement indeed comes tomorrow. I’m sure we’ll learn a bit more about AT&T’s plans then. Stay tuned.

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