AT&T Looking To Dump DirecTV After Years Of Merger Headaches
from the merge-ALL-the-things! dept
AT&T spent $200 billion to acquire Time Warner and DirecTV, believing this would turn the dodgy old phone company into an innovative new media juggernaut. But despite $42 billion in tax breaks and oodles of regulatory favors from the Trump administration (like killing net neutrality), AT&T simply couldn’t overcome its own nature as a bumbling, government-pampered telecom monopoly.
As a result, the company has laid off more than 52,848 employees, lost more than 8 million TV subscribers, and made numerous enemies by shitcanning numerous top executives, gutting numerous brands that were popular with consumers (Mad Magazine comes quickly to mind), and behaving like a cocky bully in a high school cafeteria despite having clearly no idea what it was actually doing.
AT&T was ultimately forced to sell Time Warner to Discovery, which somehow made things even worse. Now, after socking customers with two sets of price hikes this year alone, AT&T is purportedly considering exiting its 70 percent ownership stake in DirecTV as well. Apparently, and who would have guessed it, but there’s not much of a future in traditional satellite TV service:
“AT&T’s purported exploration of its DirecTV stake comes about as DirecTV and other pay-TV providers continue to shed subscribers. Leichtman Research Group (LRG) estimates that privately held DirecTV lost about 400,000 subscribers in Q2 2023, ending the quarter with 12.35 million.”
Great job everyone, terribly impressive. What was supposed to be a masterful gambit to position AT&T as a media colossus, instead resulted in an absolute swath of incompetence and dysfunction where hundreds of billions of dollars were all but set on fire. All while AT&T broadband customers in countless states remain stuck on aging DSL lines instead of fiber because the company has historically been too cheap to fully upgrade its networks (despite taxpayer subsidies).
There will, of course, be zero introspection from anybody in this chain — at AT&T or U.S. regulators — in terms of whether any of these deals should have proceeded in the first place. The entire saga will be memory holed so we can repeat the exact same process with some new media or telecom juggernaut a few years from now, having learned absolutely nothing from the experience.
There’s simply no financial incentive for anyone involved to think too deeply about any of it. Executives got their short term tax breaks, outsized compensation, and fail upwards participation trophies, while regulators got rewarded with shiny new revolving door opportunities. All while employees lost their jobs and consumers got stuck with price hikes and ever-shittier streaming services. Quite the innovation.
Filed Under: enshittification, growth for growth's sake, m&a, mergers, streaming, telecom, video
Companies: at&t, directv
Comments on “AT&T Looking To Dump DirecTV After Years Of Merger Headaches”
Dump, my boy, you never know who’s gonna dump you.
Now is the time for Elon to buy AT&T and show them how its done.
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If ATT closes down DirectTV, it is almost certain Musk will make some bold announcements about Starlink soon becoming a TV service. Just to boost his subscriber service.
Of course reality will be that nobody in the Starlink team knew about that plan and they have zero contracts with anyone. That they would be a year or more out from being able to do it.
But Musk will pretend he is “confident we can do it today!”
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That would be a brilliant idea for a Trump level stable genius, as Starlink is already taking subscribers away from Direct T.V. because it allows them to use streaming TV.
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Coming soon: Elon TV, where every single program including the ads will be hosted by and starring Elon.
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Musk will bring OANN back, break the contracts of every other channel, and blame advertisers.
Speaking of Mad Magazine. Just last week I got an ad about subscribing to the “ALL-NEW MAD MAGAZINE!” (Yes in all caps).
I was genuinely excited even if later years Mad was mostly crap, it still had some good stuff.
Then I looked at the fine print and there is nothing new about it. They are just reusing classic comics and reprinting old spoofs and charging folks again.
I don’t want that. I just want to buy the individual old issues.
My guess what happens next: AT&T announces that DirectTV is shutting down and that they want to make good with the millions of customers.
So they need $$$$$ billions from the federal government to reactivate dark fiber into the communities and build out new lines.
In the meantime, unless they opt out, subscribers will be moved over to the ATT streaming tv service.
Then in five years when everyone has forgotten about ATT’s promise to add more fiber (ghat they barely did), we will find out they spent all of the federal money on other things. Like exec bonuses.
KARMA
AT&T shareholders ultimately pay the price for the incompetence of their corporation’s managers.
Government regulators pay no price for their incompetence, and learn nothing.
American people remain bewildered by the eternal Federal circus.
ATT always just following what the others are doing…
pity it took them this long to follow all the customers dumping them….
If you bought Att stock the day the s$p bottomed during covid….
the s%p is up 60% in that time
AT&T is down 43%….
a completely mimanaged company
I cant say its funny
Its interesting that when a company BUYS another company(anymore) they dont look at the basics.
WHAT created the business and HOW it was developed.
They generally JUMP IN, thinking they can Change or help or Adjust SOMETHING and make it better, BUT NOT backup the thing and go Back a few steps to stabilize things.
Example..
Take a bunch of Persons that Liek to build cars. As a small company they are doing well and want to expand, but dont have the capital.
Some rich person wants 50% of the company and will Give the the money.
WELL, they dont know exactly what to do, so they try to expand. and do a good/bad job at it. But also 50% of their company is now going to the rich person. Who wants to buy out the company.
The creators, think this is a quit money grab, and take the money and hand it over to the Rich guy, who thinks he can do a better job, as HE has Contacts.
WELL, he has contacts, but he Lost the creators.
In ATT case, those that KNOW things in those other business’s arent at the top. They didnt go Into the companies to FIND the little problems that are HURTING THEM.
IMO, most of the corps are in abit of trouble, after Pushing up prices over the past 20 years. Going from $5-$7 per hour, which NO ONE PAYS. Means the lower wages are NOT what they were, and NOT everyone is getting a fair wage.
Its as FORD figured. Pay his employees enough that THEY can afford(pun intended) a FORD.
But corps had a great idea, to Diversify BILLS. Which means they Let other companies handle certain Things, INSTEAD of themselves. Like billing and Customer service. And FORGOT the OVERHEAD of the boss’s on top. Even if it was a sub company of the corp, How many Boss’s can you be PAYING that dont do the MAIN JOBS?
It forces me to see that the TOP people of the corps are only Bill collectors, and know Little of the corps, nor how Business’s have Manipulated the system. they dont know HOW to SAVE MONEY.
the good news
In a few years, people will start to believe you made this shit up.
/s
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Killing net Neutrality is a favor to all
Calling that a “regulatory favor” is frankly hilarious.
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… You can’t be the real Matthew Bennett. He has at least read Techdirt articles.
You know, things like “The FCC tried to kill Net Neutrality and found that disowning responsibility made them unable to prevent states from enacting their own NN laws.” (and the follow-up, where they dropped the suit.)
About the only thing you have in common with him is failure to back up your trolling.
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…believed nobody mentally competent, ever.
AT&T again
I always like to dump on AT&T when these stories appear.
When it comes to legacy telcom, AT&T has the maximum Reverse-Midas touch.
Anything they acquires and/or spins-off will die / is dying / is already dead, and will vaporize some thousands of jobs, careers, pensions and billions of dollars.
Proving yet again that acquiring Time-Warner is the kiss of death (look what it did to AOL).
wg
Huh?
I’m surprised they had that many subscribers in the first place.
Unless your in the Great Plains or Heartland there’s not much good for a satellite tv service. Unless these were internet tv subscribers, who found Hulu and YouTube had far better offerings in the price of service.