Congress tackles merger of AT&T and DirecTV

New York Times News ServiceJune 24, 2014 

WASHINGTON -- AT&T has miles of copper wire and fiber-optic lines installed in homes and neighborhoods around the country, a platform with which to provide high-speed Internet service. But it has a paltry offering of video services. DirecTV, in contrast, has a big satellite television business but no broadband offering.

That, according to the companies, is why regulators should approve their $48.5 billion merger, which would make them a formidable competitor to Comcast, which is trying to buy Time Warner Cable for $45 billion.

On Tuesday, antitrust panels in the House and Senate conducted back-to-back hearings to examine the AT&T-DirecTV merger, featuring the chief executives of both companies and an array of public interest groups, cable television rivals and academics.

The hearings followed a little more than two months of similar investigations into the Comcast transaction.

There was little sign at the House hearing of the animosity that flared up during the Comcast-Time Warner debates.

Unlike those companies, which have two of the lowest customer satisfaction ratings among TV and Internet service companies, AT&T and DirecTV have not stirred the same passions among those who fear the growing power of cable and broadband behemoths.

The ranking Democrat on the House antitrust subcommittee, Rep. Hank Johnson of Georgia, said there was "ample evidence" that the merger would create "considerable public interest benefits."

The chairman of the antitrust subcommittee, Rep. Spencer Bachus, R-Ala., said that consolidation in the telecommunications industry raised "issues of market power and the abuse of dominant competitive positions." But Bachus was also quick to list the efforts AT&T has made for low-income families, like reducing high school dropout rates.

The companies did face opposition from some witnesses.

"This proposed deal fails the antitrust test, it fails the public interest test, and it raises many concerns," said John Bergmayer, a senior staff lawyer at Public Knowledge.

"AT&T and DirecTV directly compete in more than 60 local TV markets," Bergmayer said. "It's hard to accept AT&T's claims that buying a direct rival can be good for competition."

AT&T spoke of how its planned merger would greatly expand the number of its customers who could get high-speed Internet service, noting that it had agreed to abide by the Federal Communications Commission's 2010 Open Internet policy.

The Sun Herald is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere in the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

Commenting FAQs | Terms of Service