The justice department also reviewed the deal and gave a thumbs up.
Advertisement
In late June, AT&T again extended the provisional deadline for closing the DirecTV transaction in order to give more time for the regulatory green light, insisting that it was confident the merger would be “consummated” shortly.
AT&T and DirecTV operate in two different – albeit rapidly converging – industries and thus, their merger isn’t viewed as harmful to competition.
AT&T is looking to increase its marketshare in the pay TV sector, since its existing U-Verse brand has only a modest marketshare of 5.7 million users.
Federal Communications Commission Chairman Tom Wheeler has recommended that the full FCC approve the AT&T-DirecTV merger with several conditions designed to prevent AT&T from using its clout to squeeze potential rivals. The company has also been barred from applying data caps on customers unless it also applies the cap the over-the-top video capability it is acquiring with DirecTV. “We hope the order will be approved by the Commission quickly and we expect to close shortly thereafter”. The other four commissioners still have to vote on the proposal. “The proposed order outlines a number of conditions that will directly benefit consumers by bringing more competition to the broadband marketplace”.
“If the conditions are approved by my colleagues, 12.5 million customer locations will have access to a competitive high-speed fiber connection”, the FCC chief said. “This additional build-out is about 10 times the size of AT&T’s current fiber-to-the-premise deployment, increases the entire nation’s residential fiber build by more than 40 percent, and more than triples the number of metropolitan areas AT&T has announced plans to serve”.
The order consists of a set of regulations that move towards the establishment of the Internet neutrality concept. DirecTV does not offer broadband or voice services of its own but does offer synthetic service bundles of video, voice and broadband services in conjunction with CenturyLink, AT&T and Verizon, among others.
Advertisement
Wheeler also proposed that AT&T must submit to the FCC commercial Web traffic arrangements it makes with companies like Netflix or Internet backbone companies like Cogent “to bring greater transparency” to such deals. The FCC appears to be ready to let the AT&T try its hand at being a pay-TV provider.
