AT&T's Plan To Purchase DirecTV Could Making Cutting The Cord Even Harder
June 12, 2014
With mobile devices, it has never been easier to stream video content once available only on television sets. Unfortunately, to do so often requires a satellite or cable subscription. That isn’t likely to change if AT&T is allowed to buy DirecTV, according to The Washington Post.
On Wednesday, AT&T told U.S. regulators that combining with DirecTV would lead to lower priced bundles for satellite and high-speed Internet. In turn, cable companies would be forced to lower their prices too. A win-win for consumers, according to AT&T.
Those same consumers have grown tired of bundling, consistently telling pollsters they would rather buy content a la carte.
Unfortunately, “If anything, the major telecom and cable mergers under federal review highlight those industries' long-term commitment to the very model of bundling that consumers say they want to leave. And if approved, those bundles will be harder for customers to abandon, analysts say.”
Besides the proposed AT&T/DirecTV merger, federal regulators are also in the process of determining whether Comcast is allowed to buy Time Warner Cable.
Buying DirecTV may very well allow AT&T to lower its prices. But “to fully take advantage of the most popular television content, consumers won't get it outside the pay television wall, analysts say.” In other words, don't expect most to cut the cord anytime soon.
On a positive note, AT&T has promised to extend fiber high-speed Internet services to 2 million more customers, assuming the merger is approved. They also promised to bring wireless high-speed Internet to 13 million largely rural customers. The upgrade would deliver broadband speeds of 15 to 20 mbps.
Whether these customers will need to buy a DirecTV bundle to take advantage of the new services, not surprisingly, remains to be seen.
In May, AT&T first announced plans to purchase DirecTV for nearly $50 billion. At the time, AT&T said the merger would create “a unique new competitor with unprecedented capabilities in mobility, video, and broadband services."
See also: Sony Takes Aim At The Apple TV, Announces Its Own $99 PlayStation TV Set, Millennials Are Ditching Their Television Sets, Shifting To Mobile To Watch TV Shows, and Apple Pushing Ahead With 'Less Ambitious' TV Service, Report Claims.
