Determined not to be dwarfed by the prospective union of Comcast and Time Warner Cable, AT&T appears close to buying satellite TV king DirecTV for about $50 billion, according to a Bloomberg report.

Bloomberg cites people familiar with the matter who say that AT&T Inc. (NYSE: T) is now in advanced talks with DirecTV Group Inc. (NYSE: DTV) about the deal. Under the plan being discussed, Bloomberg says, DirecTV management would continue to run the satellite service as a unit of AT&T. In addition, current DirecTV CEO Mike White would retire after 2015.

If the deal is actually sealed, it would create a huge phone/satellite/broadband monolith in the Americas, particularly in the US. In the pay-TV market alone, the new company would have more than 43 million video subscribers, including about 26 million in the US and the rest in Central and South America.

AT&T would also be scooping DirecTV out of the clutches of number two satellite TV player Dish Network LLC (Nasdaq: DISH), which has long craved to merge with DirecTV. Dish Chairman and Co-Founder Charlie Ergen has had his eye on DirecTV for years. (See Dish CEO: DirecTV Merger Possible.)

Of course, any deal struck by the two companies would be subject to big-time regulatory scrutiny by both the Antitrust Division of the U.S. Department of Justice and Federal Communications Commission (FCC) , which are already gearing up to consider the proposed acquisition of Time Warner Cable Inc. (NYSE: TWC) by Comcast Corp. (Nasdaq: CMCSA, CMCSK).

DirecTV's stock was buoyed by the M&A chatter, surging $5.29 (or about 6%) to $92.45 in after-hours trading on Monday evening. AT&T's share price dipped 6 cents to $36.51.

— Alan Breznick, Cable/Video Practice Leader, Light Reading