Why Would Dish Want to Buy DIRECTV?

20 comments

Q. I read your article today about AT&T selling DIRECTV to Dish. Why would Dish want DIRECTV now? Aren’t they losing subscribers, too? What’s the point of buying a satellite TV service in a pandemic, particularly when the business is dying. I don’t get it. And wouldn’t the federal government block the deal anyway? — Ernest, Philadelphia. 

Ernest, I wrote an article today detailing the new Fox Business report that quotes unnamed bankers as saying AT&T basically has no choice now but to sell DIRECTV.

The report, penned by Fox’s Charlie Gasparino, says AT&T shareholders are demanding that the company reduce its debt. And that might be more easily done if AT&T sold DIRECTV which has lost five million subscribers in the five years since the company bought the satellite TV service.

Gasparino notes that Dish, the nation’s second largest satellite TV service, would be a logical buyer.

But why, you ask, would Dish be interested in DIRECTV? Dish has lost almost two million subscribers in the last two years. Why take on another loser in the category?

While Dish is also losing customers to cord-cutting, and the expansion of streaming options, the acquisition of DIRECTV would give it around 27 million pay subscribers. That would make Dish the nation’s largest pay TV company. (Note: Dish has nine million subs; DIRECTV has somewhere between 15 million and 16 million; The Dish-owned Sling TV has 2.3 million.)

With roughly 27 million subscribers, and no competition in the satellite TV category, Dish could stay profitable for years by generating more advertising, and pressuring programmers to offer lower carriage fees. Think of it. Few programmers would want their channels suddenly removed from a pay TV service that reaches more than 27 million homes.

Dish Chairman Charlie Ergen has said he’s open to a DIRECTV merger, even calling it ‘inevitable’ earlier this year. He realizes that a satellite monopoly would allow his company to streamline operations, which would dramatically reduce expenses.

You might say the federal government would frown upon approving a merger that would give so much power to one video company, particularly considering that the FCC rejected a 2002 merger attempt by Dish and DIRECTV. But with the rise of streaming, the pay TV business (cable, satellite, telcos) no longer dominates the video category as it did 18 years ago. Consumers today have a multitude of video options, and the number is growing almost daily.

Dish and DIRECTV could even argue that the merger/sale is necessary now to keep the satellite TV business afloat in the coming years.

For AT&T, the sale would give the company a chance to re-set its strategy, and focus entirely on the streaming business, headlined by HBO Max.

Certainly, AT&T’s denials that any sale, much less one to Dish, is ‘inevitable’ have to be carefully considered. But as the Fox Business report notes, the pandemic is placing even greater strain on DIRECTV, and AT&T’s overall business plans.

If AT&T doesn’t sell now, then what could possibly be its plan for DIRECTV besides watching more subscribers flee?

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20 comments on “Why Would Dish Want to Buy DIRECTV?”

    1. Direct TV has the worse customer service in the world. Selling DTV would get rid of thousands of off shored jobs, who cares!

      1. Agree with the comment that Direct TV has the worst customer service in the world.
        My question would be what happens to the ATT sports channels? Would they be sold as well or would ATT just continue to own another business that they really have no business being involved in, since they’ve just screwed that up too?

  1. XM Radio and Sirius Radio were in a similar situation. They merged and it worked out. It should work for DTV and Dish.

  2. Maybe we can get Customer Service back if Dish takes Directv. I would bet customer service is the root cause of subscriber loss for DirecTv . I’ll love my Directv but hate dealing with CS. I would leave DT if I weren’t under contract because of a stupid program upgrade.

  3. I have Directv, I’ve had them nearly 20 years, but this will be the last year whether they sell or not. They definitely do not take care of loyal customers.

  4. I agree about AT@T’s customer service also. Let’s not forget that AT@T has also gotten EPIX, 5 west coast feeds of different basic networks, and SportsNet LA I believe. Let’s also not forget that Dish Network gets in a lot of channel blackouts. They do not have HBO and Cinemax either. Dish Network does have PAC-12 though.

  5. As soon as AT&T bought DirecTV my bill went up and up, I called and complained it went down and just like when I used to have AT&T for phone service it went back up again hoped I wasn’t watching. Good riddance get someone who knows about customer service and loyalty

  6. I have had Direct tv for quite awhile and I love it. No matter what kind of weather it works. I had Dish before and the suck. One drop of rain and it goes out on you. Please don’t sell it to Dish.

  7. I moved from dish to direct when they cut channels. But when at&t bought direct they just ruined it. Prices, reception, customer service all suffered. I cut the cord. Now get me some cheap internet.

  8. I have had Direct tv for twenty years. Always loved it until they kept raising the price. I now pay over two hundred dollars a month. I live on a fixed income and can’t afford it anymore. I don’t like the streaming that they call tv. Just want regular stations. Someone please buy Direct tv and keep it as it is and now they won’t even come out and fix any problems

  9. I changed from Dish to Direct TV, and am on the second year of my contract.
    I’m cutting it and going to all streaming.

  10. I have been a DirecTV customer since 1996, two years after it first hit the market. It had the best and most reliable customer service available. When at&t bought it all that went to hell and the bill skyrocketed. Things that were standard became a new tier package. If Dish buys DiresTv maybe I’ll change my mind about leaving them.

  11. Both are expensive as hell on a fixed income be nice if someone else would come in with cheaper prices for old people

  12. Some people don’t have the luxury of internet service to stream programming. I personally LOVE Directv it’s very affordable and customer service is very good as well. Internet service providers limit bandwidths even though you pay for unlimited data. To each his/her own, but do the math streaming services are not cheap either they only appear to be cheaper. Especially when you live in a rural community and have access to one cable and internet provider (Sparklight) they can charge you any amount they want. I ended up paying almost $200.00 per month for unlimited data (because I was “Going Over” the data limits) and still had to pay for streaming services on 1 tv..

    1. You are confused. I think you might be think of “DISH”
      They have Customer Service.

      DirecTV does NOT have customer service. Who gave you that idea ???
      DirecTV is also NOT “Affordable” as you will realize if you READ the Other Comments.

      Where is “Sparklight” ?

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