from the yeah-that-didn't-work dept
It’s really hard to overstate what a colossal failure AT&T’s $200 billion acquisition of Time Warner and DirecTV was. And if you’re an AT&T executive with a bruised ego in the wake of the implosion, the hits just keep on coming.
The megadeals were supposed to cement AT&T as a powerhouse in media and video advertising with HBO and the NFL as cornerstones. Instead, terrible leadership and hubris resulted in more than 50,000 layoffs, the closure of numerous loved brands (Mad Magazine, DC’s Vertigo imprint), the loss of millions of TV subscribers, and a mountain of debt AT&T’s still trying to climb its way out of.
Paying off that debt involved offloading a lot of acquired assets for a song. It has also involved AT&T spinning off DirecTV in a new partnership with private equity firm TPG Capital. One of DirecTV’s flagship properties has been the exclusive deal to distribute out of market NFL games via NFL Sunday Ticket.
But with that deal expiring in 2022, and DirecTV still hemorrhaging cash (not only from the megamerger spree but because of the continued pace of cord cutting), the rights will soon be up for auction. And two of the top suitors for the properties will be Apple or Disney:
Apple is exploring an audacious plan to scoop up the NFL’s available rights with a single, multibillion-dollar deal, sources tell Front Office Sports.
The NFL is currently fielding offers for three assets: an equity stake in NFL Media, the “NFL Sunday Ticket” package for out-of-market games, and livestreaming games on mobile devices.
Apple wants to bundle them all into one sweeping deal, said sources. That would instantly make the tech giant, which has long avoided sports, one of the NFL’s biggest business partners.
Again, AT&T’s entry into the media and video ad market was supposed to cement it as the preeminent name in media, sticking it to the traditional tech giants AT&T has long had a fraught relationship with. Instead, AT&T’s still scrambling to get its head above water and companies like Apple and Disney are becoming the very thing AT&T telecom executives dreamed they could be.
Not only does this deal probably bruise the ego of telecom executives that hungrily eyed media expansion but lacked the competency to execute, the broader, more competent distribution of live sports over the internet is likely to only accelerate the cord cutting shift away from traditional TV services (especially services like Dish and DirecTV, which will soon be on life support).