Chase Carey, chief executive officer of DirecTV (s DTV), is leaving the satellite TV provider and going back to News Corp. (s NWS) to take the chief operating officer reins from Peter Chernin. He will also be the deputy chairman and president of Rupert Murdoch’s company. John Malone, who bought DirecTV from Murdoch, can’t be happy about this. That said, the company is continuing to do fine in a tough economy and beating its cable industry rivals.
DirectTV added 460,000 new subscribers during the first quarter of 2009, thanks to promotions from a new AT&T (s t) partnership. And it’s in the process of being merged into the entertainment division of Liberty Media, which is then slated to be spun out into a separate, publicly traded company. Still, many are wondering what’s next for DirecTV, especially since Liberty Media CEO Greg Maffei called a sale of DirecTV to a phone company following the spin-off “possible.” UBS analyst John Hodulik makes a compelling case for that company to be AT&T:
Believe the end game is an AT&T purchase of DirecTV
Wireless penetration is nearing 90 percent and industry growth is slowing. Meanwhile, AT&T has slowed the pace of its U-verse build to 4-5M incremental homes in 2009 vs. 9M in 2008. DTV would give AT&T cost synergies and boost consumer revenue trends.
AT&T’s sales are dropping: Consumer revenues fell 6.8 percent in the first quarter while business revenues dropped 6.7 percent. Total wireline sales were down 5.4 percent. The company is riding the iPhone juggernaut, but that isn’t enough. Wireless post-paid additions are slowing down. Ergo, AT&T needs someone like DirecTV to goose up its revenues.
Wall Street has linked AT&T to digital satellite providers before. There were rumors that AT&T was almost ready to buy DirecTV competitor EchoStar (s sats). That deal never came to pass. Will this one?
It could happen, but it could go either way really.
Why would AT&T buy a competitor for U-Verse? Seems like they’ve already bet on a future of semi-symmetrical downstream/upstream data.
They would buy DirecTV as a compliment to U-Verse. U-Verse will not make it into AT&T’s entire footprint. DirecTV can be sold and used anywhere. So in areas where U-Verse is available AT&T would not offer DirecTV.
Okay, here is the deal, real world, At&T is going to buy DirectV,
Why? Because the telecomms are going to take over the airwaves with LTE, for those who know not, LTE is the acronym for Long Term En. LTE is a 100 Mbit wireless network that is very very capable of the quad play. They will buy DirectV just for the content. They will then move all of the communications to the wireless network, set up LTE in every market, and drive the cable companies to near bankruptcy with low prices. After this is accomplished, they will then buy out the cable companies or force them into becoming a third tier carrier and rape them for their fiber backbone, just so they can keep their doors open.
You ask, how does he know this? Because I have a brain in my frickin head, look what Echostar is doing with Century Tel, They are positioning them selves for a merger there, why you ask? to accomplish the same thing AT&T is with DirectV. End Game the Telecomm wars start again, but this time they have a hell of a lot more money and stroke, lets see how the government handles this! When between the two companies they hold 60% of the TV services and 55% of the telephone and internet service. Can you say Monopoly? Come on people wake up! Big Business Rules The Game, Haven’t you learned that yet? If they can get a Black Man In The WHITE house, they can do anything. But I guess we can see how that back fired too. LOOLOLOOLOLOOLOLOLOLOOL