trending Market Intelligence /marketintelligence/en/news-insights/trending/EuOfzGOontOgcz2uplXKdQ2 content esgSubNav
In This List

Report: AT&T considering strategic alternatives for DIRECTV

Blog

Broadcast deal market recap 2021

Blog

Volume of Investment Research Reports on Inflation Increased in Q4 2021

Blog

Price wars in India: Disney+ Hotstar vs. Amazon Prime Video vs. Netflix

Blog

Using ESG Analysis to Support a Sustainable Future


Report: AT&T considering strategic alternatives for DIRECTV

AT&T Inc. is considering a sale of satellite and digital video unit DIRECTV, according to The Wall Street Journal, citing people familiar with the matter.

The wireless carrier has considered various options, including a spinoff of DIRECTV into a separate public company and a combination of DIRECTV's assets with DISH Network Corp., sources told the Journal, adding that AT&T may ultimately decide to keep DIRECTV.

The news comes after Elliott Management Corp. criticized the performance of DIRECTV under AT&T, including virtual TV bundle DIRECTV NOW, and suggested AT&T should consider divesting or spinning out DIRECTV, among other assets. AT&T responded by saying it was already considering many of Elliott's suggestions.

In the days following Elliott's letter, Fox Business and other news outlets reported that AT&T was being "inundated" with pressure from bankers to consider alternatives to shedding DIRECTV, with DISH Network as a primary potential suitor. AT&T would be unlikely to sell the DIRECTV given its declining performance and the lack of suitors, analysts recently said in interviews with S&P Global Market Intelligence, but the company could potentially engineer a merger spinoff with DISH, according to Fox Business.

AT&T's DIRECTV and U-verse video platforms, lost 778,000 customers in the second quarter, while virtual provider DIRECTV Now, currently called AT&T TV Now, shed 168,000. The company expects it will drop another 300,000 to 350,000 premium TV subscribers in the third quarter, a period that has seen it embroiled in lengthy blackouts with Nexstar Media Group Inc. and CBS Corp. AT&T chairman and CEO Randall Stephenson conceded these retransmission disputes were painful.

DISH's net pay TV subscribers declined about 31,000 subscribers in the second quarter, compared to a loss of about 151,000 in the second quarter of 2018. As of June 30, DISH had 12.03 million pay TV subscribers, including 9.6 million DISH TV subscribers and 2.5 million subscribers for its digital bundle Sling TV.

Separately, some investors recently filed a lawsuit accusing AT&T of fabricating some of its DIRECTV NOW subscribers ahead of its 2018 acquisition with Time Warner, according to Bloomberg.