DirecTV and Dish Network once again face regulators asking for permission to merge
The concern at the time was that rural Americans, without a plethora of wireless internet options, might have to deal with higher pricing for service in the aftermath of a merger between DirecTV and Dish. But the thinking regarding a merger between DirecTV and Dish has undergone a change as both firms no longer wield the power they once had. And some believe that the merger is just the thing needed to jumpstart the sluggish rollout of wireless 5G service in the states.
According to a source close to the talks, DirecTV’s 30% owner, TPG Capital, is pushing to get a deal done. The company purchased its stake in DirecTV from AT&T last February and is looking to get rid of the investment and recoup its losses. TPG’s acquisition of its stake in DirecTV put the enterprise value of the firm at $16.25 billion.
But both agencies signed off on a plan that replaced Sprint with Dish. The hope is that Dish will eventually the “fourth nationwide facilities-based network competitor” replacing Sprint and thus keeping prices from rising. Thanks to an MVNO deal it has with AT&T, Dish could offer wireless service to customers while building its own stand-alone 5G network.
Will regulators allow two declining satellite TV providers to merge?
Dish has seen the number of its satellite subscribers drop from 13 million to 8.4 million. With both companies struggling, many believe that the regulatory agencies might be more apt to approve a merger. A person close to the deal says, “They’re coming together because it makes all the sense in the world. Both are decaying, dying channels — you can’t argue there is an antitrust issue.”
The big question according to those insiders familiar with the situation is whether the regulators will block the combination of the country’s two top satellite-TV providers before the buildout of rural broadband has been completed. Wireless analyst Craig Moffett told The Post that “The FCC and DOJ would likely both conclude that having one strong satellite competitor is better than none at all — and the future is not terribly bright even together but especially alone.”