Re: Why Does This Make Sense@danielcawrey, It is my understanding that it will include that - which will make their package highly competitive.
It is also my understanding that they have written into the deal the option to withdraw from the offer if DirecTV does not get the NFL renewal contract (which is rumored to be having a hefty rate increase).
My point is this. For all times t from the start of recorded history until now, Good Content gets paid. Good Content Never Pays. JK Rowling gets paid to write books. Metallica gets paid to put out albums. The NFL gets paid to televise games. See how this goes?
Disney will NEVER pay for a fast lane to deliver any content. Just remember Comcast is already paying Disney a BOATLOAD of money to put in a special fast lane to deliver its content via its pay TV service. Anybody who thinks Disney is going to pay to do OTT is patently insane. That is why this fast lane thing matters not in the least.
Note: Netflix outside of House of Cards and Arrested Development is not a content owner but an aggregator.
As to the deal, remember U-verse in its current implementation requires 2500' loop lengths. Outside of urban/suburban areas this is just not going to be possible (1 VRAD per farm in Kansas). Not only does AT&T get all the video stuff, it gets to remove broadcast video from the requirement of a rural DSL upgrade. Right now in those properties AT&T had been deploying ATM based ADSL (in fact they had us turn off ADSL2+ on the DSLAMs so that the line would train in ADSL). They have wanted to move to IP DSL but probably want to offer a ubiquitous triple play as a way to get a switch done. Now they can.
I think it means holding on to a subscriber is worth the expense (pays for delivery and the cost of a win-back). Good content is one way. NFL Sunday Ticket is to ATT what Barclay's Premier League is to BT (I would have said NBC except they don't really know what they're doing).
Re: Why does this make sense?It's Comcast versus AT&T in the United States for cable.
I find it strange that AT&T would buy DirecTV, a satellite company. But there are only so many corporate marriages that can be done when you get to the size of AT&T. We'll see how this shakes out over time.
Does it mean that the NFL Sunday Ticket Package will be available to all AT&T subscribers? That could be a windfall of revenue.
Re: Why does this make sense?I had read that the buy would add about 20 million new U.S. customers which make the price about $2000 per satellite customer. That should easly pay off over about three years, the time AT&T says subcription prices will remain steady for the new customers. Expect a healthy profit and continuing revenue for AT&T if the deal goes through.
FYI, they just discussed on CNBC that AT&T could pull out if DirecTV doesn't get a renewal of the NFL Sunday Ticket deal. This could mean a bidding war for that content.
Re: Why does this make sense?I don't think it explains the whole deal, but agree that NFL Sunday Ticket and perhaps other DirecTV content are important gamepieces in this deal.
Overall and strategically, I don't completely get it either. AT&T has been rumored for about six or seven years to have desire for a satellite acquisition, so maybe Ma Bell just couldn't put this one out of her mind.
Re: Why does this make sense?A big key to this could be NFL Sunday Ticket. This give AT&T some valuable content which is likely to become more important than ever in light of the planned Comcast-Time Warner deal.
It would likely also help AT&T in non-rural areas where U-verse has only limited availability. For example, I have a daughter who lives in Springfield, Ill. U-verse is not available in her subdivision, though it is available a few blocks away.
It is also my understanding that they have written into the deal the option to withdraw from the offer if DirecTV does not get the NFL renewal contract (which is rumored to be having a hefty rate increase).