TV Answer Man, I read your story about a possible DIRECTV and Dish merger. It sounded like it could happen soon. Do you expect it will happen before this year is over? And what would that mean for the subscribers? I’ve had DIRECTV for 11 years. — Sheila, Gaithersburg, Maryland.
Sheila, Dish Chairman Charlie Ergen last week repeated his assertion that a Dish-DIRECTV merger is “inevitable” and he noted that federal regulators might be more inclined to approve it now with Congress expected soon to approve $65 billion in Broadband projects in unserved areas. (That would increase video competition in markets where high-speed Internet access is limited, making it less important to have multiple satellite TV choices.)
“From a regulatory point of view, obviously, there’s less and less reality to objections to it because, obviously, the hundreds of billions of dollars of broadband deployment and continued competition from the programmers themselves in the marketplace,” Ergen said.
However, despite the upbeat forecast, it’s highly unlikely we would see a merger in 2021. AT&T just closed on its sale of 30 percent in DIRECTV to private equity firm, TPG, allowing the two entities to form a separate company consisting of DIRECTV, U-verse and AT&T TV, which will be renamed DIRECTV Stream later this month.
The new management team will likely want to implement cost-cutting measures and other actions before engaging in talks to sell DIRECTV to Dish. In addition, Congress hasn’t officially approved that Broadband money yet so federal regulators may still be skeptical.
I don’t expect Dish and DIRECTV would merge until the second half of 2022, if then. That would allow TPG and AT&T time to position the new DIRECTV in the way it envisions, and for the climate in Washington to be more favorable to a deal. And if a merger is announced in the second half of 2022, it wouldn’t likely become official until 2023 after a several-month long federal review.
Considering that could be as much as 18 months away, it’s difficult to say how the merger would affect DIRECTV and Dish customers. The video market could be dramatically different then so any speculation on how Dish would run both services is not valid.
But the TV Answer Man will continue to monitor this situation, and report back here if anything changes.
Until then, happy viewing, and stay safe!
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— Phillip Swann