DirecTV to become standalone company after AT&T, TPG Capital ink deal

Posted:
in General Discussion
AT&T has reached a deal with TPG Capital that will see struggling satellite TV provider DirecTV become its own standalone company.

Credit: AT&T
Credit: AT&T


Under the terms of the arrangement, the deal will create a new company called DirecTV with an implied enterprise value of $16.25 billion. TPG Capital will take a 30% stake in the business, while AT&T will own the remaining 70%.

The deal has been in the works for months as AT&T has been looking for ways to offset the impact of DirecTV's subscriber losses on its results, Variety reports.

"This agreement aligns with our investment and operational focus on connectivity and content, and the strategic businesses that are key to growing our customer relationships across 5G wireless, fiber and HBO Max," said AT&T CEO John Stankey.

Although the agreement covers DirecTV, AT&T TV, and AT&T U-verse MVPD, it doesn't include AT&T's Latin American video operations, U-verse network assets, AT&T's Sky Mexico investment, or regional sports networks.

AT&T has also committed to absorbing $2.5 billion in net losses from the NFL Sunday Ticket package. The carrier will get $7.6 billion in cash from the new entity.

In the fourth quarter of 2020, DirecTV recorded a net loss of 617,000 subscribers. The company has seen a steady decline in subscribers for two years, though AT&T says the situation has improved in the past five quarters.

Comments

  • Reply 1 of 12
    dewmedewme Posts: 3,398member
    This should increase DirecTV's chance of survival. AT&T added no value.
    edited February 25 applguytexflan2itivguy
  • Reply 2 of 12
    maestro64maestro64 Posts: 4,895member
    Directv loss viewers because of what AT&T did, they increase the price multiply times and the user interface got worse in the last few years I’m at the point I’m going to drop it since it’s not worth it anymore.
    texflan2itivguydarkvader
  • Reply 3 of 12
    Forcing AT&T ads to show whenever my shows are paused is a frustrating change to the UI that has directly let to me reducing my channel package and switching to streaming on Appletv instead for everything except live sports. It's gross and invasive and unacceptable. Only themselves to blame for the subscriber losses.
    n2itivguydarkvader
  • Reply 4 of 12
    chadbagchadbag Posts: 1,285member
    Big company buys smaller company in a different but somewhat related field.  Claims the cost of the merger or acquisition is worth it due to synergies, growth in customer base, etc.  a few years later, big company sells or spins off smaller company after absorbing losses and all sorts of expenses and costs.  

    How often have we seen that happen?   Next time big company comes out with a takeover, it is a clue to get out of big company.   

    (Note I am not talking about companies like Apple that buy up really small companies for their technology or their people ).  
    n2itivguy
  • Reply 5 of 12
    I used to like our DirecTV service until they were bought by AT&T. Customer service took a nose dive. We ended up having to cancel service because a tree next to our house was blocking the signal. The customer support people refused to cancel even though their own tech came to our house and stated, “we can no longer provide you with a signal”. I called at least 8 times and they just refused to acknowledge it. Kept saying try for another month. One rep even asked if the tree in question could be cut down or had leaves that would fall off in winter and then the signal would be able to reach the dish. It was like the reps were beaten or fined for canceling service. Eventually they relented but I never did receive the full amount they said the would credit us. 

    Haven’t had cable or satellite since and don’t miss it. 
    dewmedarkvader
  • Reply 6 of 12
    Missing from this story: AT&T bought Direct TV for $67 Billion in 2015 and now it’s worth less than $16 Billion. That deal was facilitated by Stankey, now CEO. I wish I could fail upwards that hard.
    ITGUYINSDdarkvaderFileMakerFeller
  • Reply 7 of 12
    Watch how fast AT&T bails on this deal. Buying 30% of a dumpster fire is not a smart
    move. Especially when the 70% owner keeps
    throwing gas into said fire. 

    I expect AT&T to blame TPG on future rate hikes and forcing customers to buy packages they’re never going to watch. Bundling channels of crap with a few good ones. 

    The old cable playbook is dead. People aren’t going to stand for paying $$$ to be able to watch their favorite channels that come bundled with channels of life sucking garbage. 
  • Reply 8 of 12
    sdw2001sdw2001 Posts: 17,381member
    Watch how fast AT&T bails on this deal. Buying 30% of a dumpster fire is not a smart
    move. Especially when the 70% owner keeps
    throwing gas into said fire. 

    I expect AT&T to blame TPG on future rate hikes and forcing customers to buy packages they’re never going to watch. Bundling channels of crap with a few good ones. 

    The old cable playbook is dead. People aren’t going to stand for paying $$$ to be able to watch their favorite channels that come bundled with channels of life sucking garbage. 

    I agree.  I bailed on FiOS TV a few months ago.  I was paying $185 a month for 75mbs, 3 boxes, home media DVR (2 shows at once, max) and HBO.  Now I have 200/200 Internet (FiOS) for $50 including new router, YouTube TV for $65 and free HBO Max through my ATT plan.  I saved $70 a month, and that was with one of the most expensive streaming services.  Best of all, I'm getting nearly 300mbps in actual usage.  I miss nothing...I have really all the channels I'd watch, plus premium Netflix, HBO Max, Prime and Apple TV+.  
    edited February 26 hammeroftruth
  • Reply 9 of 12
    sdw2001 said:
    Watch how fast AT&T bails on this deal. Buying 30% of a dumpster fire is not a smart
    move. Especially when the 70% owner keeps
    throwing gas into said fire. 

    I expect AT&T to blame TPG on future rate hikes and forcing customers to buy packages they’re never going to watch. Bundling channels of crap with a few good ones. 

    The old cable playbook is dead. People aren’t going to stand for paying $$$ to be able to watch their favorite channels that come bundled with channels of life sucking garbage. 

    I agree.  I bailed on FiOS TV a few months ago.  I was paying $185 a month for 75mbs, 3 boxes, home media DVR (2 shows at once, max) and HBO.  Now I have 200/200 Internet (FiOS) for $50 including new router, YouTube TV for $65 and free HBO Max through my ATT plan.  I saved $70 a month, and that was with one of the most expensive streaming services.  Best of all, I'm getting nearly 300mbps in actual usage.  I miss nothing...I have really all the channels I'd watch, plus premium Netflix, HBO Max, Prime and Apple TV+.  
    YouTubeTV looks like a decent alternative to DirecTV.  Unfortunately, we purchased NHL Center Ice and that goes through April, so we can't cut DTV yet, but maybe after that.
  • Reply 10 of 12
    maestro64maestro64 Posts: 4,895member
    Anyone look at Fubo TV, when doing a side by side on cost to the channel I watch they coming in at lower cost. The only negative I had heard was they quality of the stream is not that good.

    Hands down for many yrs DTV have the best video quality expect during a heavy storm. Even Verizon FIOS quality was not that great, this is due to the how good their source quality if as well as the compression systems they were using including the box in your house. I would watch shows on friend FIOS and Xfinite service and i would still see video defects that I generally would not see with DTV.

  • Reply 11 of 12
    sdw2001sdw2001 Posts: 17,381member
    maestro64 said:
    Anyone look at Fubo TV, when doing a side by side on cost to the channel I watch they coming in at lower cost. The only negative I had heard was they quality of the stream is not that good.

    Hands down for many yrs DTV have the best video quality expect during a heavy storm. Even Verizon FIOS quality was not that great, this is due to the how good their source quality if as well as the compression systems they were using including the box in your house. I would watch shows on friend FIOS and Xfinite service and i would still see video defects that I generally would not see with DTV.

    I think you’ll find that with most streaming services as well. YouTube TV blows FiOS and Comcast out of the water on the picture quality.  
  • Reply 12 of 12
    tiger2 said:
    It was like the reps were beaten or fined for canceling service.
    I'm sure the beatings were only a temporary measure instituted until morale improved.
Sign In or Register to comment.