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AT&T in Talks to Buy DirecTV for About $50 Billion

In this photo made Tuesday, Nov. 3, 2009, an installer's truck is parked outside a DirecTV customer's home in Little Rock, Ark. (AP Photo/Danny Johnston)
In this photo made Tuesday, Nov. 3, 2009, an installer’s truck is parked outside a DirecTV customer’s home in Little Rock, Ark. (AP Photo/Danny Johnston)

(Business Week) – AT&T Inc. (T:US), joining the ranks of U.S. TV, Internet and wireless providers racing to consolidate, is in advanced talks to acquire DirecTV (DTV:US) for about $50 billion, according to people familiar with the matter.

Under the plan being discussed, management of DirecTV, the largest U.S. satellite-TV provider, will continue to run the company as a unit of AT&T, said the people, asking not to be named because the information is private. DirecTV Chief Executive Officer Mike White is likely to retire after 2015, the people said.

The purchase would give AT&T a national satellite-TV provider to combine with its wireless, phone and high-speed broadband Internet services as competition ramps up. The pool of pay-TV customers is peaking in the U.S. because viewers are increasingly watching video online, and the combination would keep DirecTV from being on its own with just a TV offering and no competitive Internet package.

“With DirecTV they are getting a national TV presence — they can sell TV with wireless nationwide,” said Roger Entner, an analyst with Recon Analytics, based in Dedham, Massachusetts. “AT&T has increasingly been breaking out of their 22-state landline footprint. They sell wireless, they started selling home security and they could add TV to that package.”

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