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AT&T’s Acquisition of DirecTV Will Likely Be Approved With a Number of Conditions

att directvWhile consumer groups were busy fighting the Comcast-Time Warner Cable merger, AT&T’s $49 billion purchase of DirecTV has largely flown under the radar, with no comparable organized consumer opposition to the deal. But that does not mean the FCC will approve it as-is.

Negotiations with federal regulators and an exchange of regulatory filings and comments between AT&T, the FCC, and deal critics have apparently forced AT&T to agree to several concessions to make regulators amenable to approving the transaction.

The Washington Post reports that chief among those concessions is AT&T’s willingness to voluntarily abide by certain Net Neutrality rules regardless of any court challenges, including banning the slowing or blocking of websites and agreeing not to accept payments from website operators to speed up their content. AT&T has not said how long it intends to keep that commitment.

Deal opponents are also seeking other concessions from AT&T:

No paid interconnection deals: AT&T must route incoming content to customers without any fees charged to the companies originating the traffic. This became a hot button issue when Netflix felt it was forced to pay Comcast a fee to assure its streamed video content would reach Comcast customers without buffering or other errors. AT&T is expected to fiercely oppose this condition and says it should have the right to make private deals with content delivery firms.

AT&T must offer standalone broadband: With AT&T’s acquisition of DirecTV, more than ever it will have an incentive to sell customers a television bundle with Internet service. Regulators want AT&T to assure broadband-only service remains readily available. AT&T has offered 6Mbps DSL for $34.95 a month as its standalone option. Content delivery firms like Cogent want AT&T to offer 25Mbps service in all of AT&T’s markets for $29.95 a month for at least seven years. The FCC recently defined 25Mbps the minimum speed to qualify as broadband.

No end runs around Net Neutrality with data caps and exemptions: AT&T wants the right to exempt its preferred partners from its usage caps and claims that is beneficial to consumers. But cap opponents claim that is simply another way to collect money from content companies for preferential treatment — an end run around Net Neutrality rules. Opponents of these cap exemptions, known as “zero-rating” claim all content should be treated the same. AT&T could resolve this by removing data caps from its DSL and U-verse services altogether.

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Joe V
Joe V
9 years ago

Does this mean that AT&T will be forced to get rid of the caps?

Joe V
Joe V
9 years ago

OR this could lead to AT&T hastily selling off their wireline assets faster to companies Frontier, CenturyLink, or Windstream to get out of the FCC’s requirements.

Personally, I don’t like AT&T’s greedy double dipping.

oobovigif
oobovigif
9 years ago
Reply to  Joe V

That should be one of the conditions but unfortunately it’s not.

Dancer
Dancer
9 years ago

AT&T must convert their U-Verse to Fiber to the home in a very rapid developement as soon as possible, ensure that other services like TV does not slow down the internet if they want to get direct tv merger.

AT&T must begin their fiber expansion for remaining of their service area instead of selling some portions of their infrastructure to Frontier or other companies not services by uverse in urban areas.

They must sell internet speeds with minimum of 50 Mbps download and upload as well on a fibre to the home network.

Paul Houle
Paul Houle
9 years ago

25 Mbps and DSL is like water and oil.

The whole point of the merger is to be able to offer a competitive TV service in rural areas as part of a double or triple play while maintaining a policy of disinvestment in wireline infrastructure.

AC
AC
9 years ago
Reply to  Paul Houle

My question would be why are they even using DSL when all of their previous promises said FTTH by the end of the calendar year on mergers.

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