FCC near OK of AT& T- DirecTV deal

Chairman gives $ 48.5B agreement thumbs up

AT& T’s $ 48.5 billion deal to buy DirecTV is nearing approval by regulators.

FCC Chairman Tom Wheeler said he has circulated to his fellow FCC commissioners the agency’s proposed order approving the acquisition, which would create one of the largest U. S. pay- TV providers. AT& T and DirecTV will have to agree to some conditions for final approval, he said.

In May 2014, AT& T announced its plans to buy DirecTV, a move to expand its television service presence nationally and enhance its buying power vs. TV networks that are demanding higher fees for their programs. Once the merger is complete, AT& T would serve about 26 million TV customers, including about 6 million who now subscribe to AT& T’s U- Verse service and DirecTV’s 20 million-satellite TV service.

“An order recommending that the AT& T/ DirecTV transaction be approved with conditions has circulated to the commissioners,” Wheeler said in a statement.

The Department of Justice’s antitrust division also said Tues- day it will not block the deal and closed its investigation.

As a condition of the FCC’s approval, AT& T will have to expand its “competitive high- speed fiber connection” to 12.5 million customer locations. It would increase “the entire nation’s residential fiber build by more than 40%,” he said.

To prevent AT& T from discriminating against other online video providers, AT& T will not be permitted to exclude its own or affiliated video services and content from monthly data caps it imposes on its broadband Internet customers. The premise of the condition is that customers, when given a choice, would theoretically opt for a video streaming option that is not subject to a monthly data cap.

AT& T’s desire to merge with DirecTV isn’t simply about finding more TV customers. Given DirecTV’s capability to deliver TV services nationwide, AT& T can sell more TV- Internet- phone packaged bundles after the merger, including possibly offering Internet services to rural customers using its wireless technology. AT& T is the nation’s second largest wireless carrier.

What’s unknown is whether AT& T will continue its participation in the suit challenging the FCC’s open Internet rules.