Arab Times

AT&T quits Venezuela

US sanctions force co to defy Maduro

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MIAMI, May 26, (AP): AT&T said Tuesday it will immediatel­y ditch Venezuela’s pay TV market as U.S. sanctions prohibit its DirecTV platform from broadcasti­ng channels that it is required to carry by the socialist administra­tion of Nicolás Maduro.

The Dallas-based company’s closing of its Venezuela unit is effective immediatel­y.

It follows a decision by the Trump administra­tion not to renew a license it had granted AT&T to continue carrying Globovisio­n, a private network, sanctioned by the U.S., owned by a businessma­n close to Maduro who is wanted on U.S. money laundering charges, three people familiar with the situation told the AP. They spoke on the condition of anonymity to discuss U.S. government licensing activity.

AT&T joins a number of other U.S. companies - General Motors, Kellogg Co. and Kimberly-Clark - that have abandoned Venezuela due to shrinking sales, government threats and the risk of U.S. sanctions. Around 700 Venezuelan­s depended on the unit for employment.

“Because it is impossible for AT&T’s DIRECTV unit to comply with the legal requiremen­ts of both countries, AT&T was forced to close its pay TV operations in Venezuela, a decision that was made by the company’s U.S. leadership team without any involvemen­t or prior knowledge of the DIRECTV Venezuela team,” the company said in a statement.

At nighttime Tuesday, residents in Caracas started banging on pots and pans for nearly a half hour to spontaneou­sly protest a decline in public services. Some yelled “I want my DirecTV” amid chants against Maduro.

AT&T has a 44% share of the pay TV market and its departure is likely to hit hard working-class barrios of larger cities and the interior that depend on DirecTV for access to informatio­n and entertainm­ent.

An Associated Press investigat­ion from January found that AT&T had been under increasing pressure from the Trump administra­tion to stand up to Maduro’s censors, who since 2017 have ordered the removal of some 10 channels, including CNN en Español, that had broadcast anti-government protests.

Local regulators accuse the channels of violating the Law on Social Responsibi­lity on Radio and Television, which seeks to guarantee socially responsibl­e programmin­g but that press freedom groups consider it a tool to muzzle critical coverage due to its ambiguous language and heavy penalties. DirecTV is also a major platform for the broadcast of state-run TV outlets criticized by the opposition as propaganda.

A never-implemente­d plan promoted by the State Department would have forced AT&T to pull the plug on Globovisio­n and the state-run channels while restoring some of the banned internatio­nal news channels, according to five people familiar with the discussion­s cited in the earlier AP investigat­ion.

AT&T hasn’t made money from its Venezuelan operations for years due to strict government controls that keep the price of its packages artificial­ly low - a few pennies per month. The situation has become so dire that DirecTV in 2012 stopped importing set-top boxes, choking its growth. In 2015, it wrote down its assets in the country by $1.1 billion.

But the company was reluctant to close down its operations in Venezuela because of its market share - the largest it has anywhere in the world - and its commitment to a satellite broadcast center from which DirecTV beams about a third of its programmin­g to several parts of South America.

An AT&T executive said that while its broadcast signal in Venezuela will stop working Tuesday, the company has enhanced other facilities in the region to ensure that service continues uninterrup­ted throughout South America. The executive spoke on the condition of anonymity to discuss internal procedures.

AT&T’s departure deprives many Venezuelan­s of what had been a cheap form of entertainm­ent in a nation ravaged by 2 million percent hyperinfla­tion. Among them is Maduro himself, who at a recent press conference boasted that he’s a fan of CNN’s English language channel, even rattling off the channel - 706 - where it appears on DirecTV’s platform.

Socialist party boss Diosdado Cabello on Twitter said “no blockade will censure us” and invited his followers to watch his weekly TV program that is broadcast on state TV on a streaming platform.

There was no immediate comment from the Trump administra­tion.

With AT&T’s announceme­nt Tuesday, however, some DirecTV subscriber­s reported that their service immediatel­y went dark, displaying the message: “Channel not available.”

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