AT&T to Buy DirecTV for $48.5 Billion | Hacker News Reader

AT&T to Buy DirecTV for $48.5 Billion

dealbook.nytimes.com

235 pointsk-mcgrady164 comments

The race is officially on! Can the Telecoms retain their terrible monopolies by becoming streaming providers Faster than the Streaming providers (Netflix, Youtube, Amazon Prime et al) trying to become Content creators?

AT&T is running out of customers to squeeze in the cell phone plans market. This is the next frontier for terrible service, exorbitant prices and regulated monopolies...

This race is rigged. Even if the streaming providers win the telecoms will just jack up the prices on their bandwidth when net neutrality is killed completely, which I don't think is an avoidable situation at this point.

If net neutrality is gone for good, the telecoms don't even have to bother entering the streaming business. They just have to look at Netflix's profits each year and charge (profits-$1) the next year, letting Netflix stay barely in business and capturing the surplus.

Netflix is not a replacement for a traditional pay-TV video service, nor will it be. It's really more of a premium channel like HBO or Showtime -- both of which already offer streaming for a similar price as Netflix. I see the industry going one of two ways:

1) Cable TV over Internet -- in this scenario your cable subscription just becomes an app that runs on a wide variety of devices. Watch live TV, DVR, on-demand, etc. with a user interface that is somewhat reminiscent of what exists today. Channels will continue to be bundled and distributed through cable providers (though I expect non-infrastructure owning companies will also be spun off or started up). This scenario is most likely as it is least disruptive to the financial structure that's been set up on the content creation side (also all the big cable/telco companies are building this already).

2) Dissolution of the "big bundle" -- in this scenario, the content owners just decide to skip the middleman and become more like Netflix themselves. For example, Disney decides to just offer their own subscription service for $12/mo which gets you ABC, ESPN and the other Disney channels. Bundling would still happen here, just on a smaller scale. This fundamentally changes the business model though, and it will take a long time for content owners to develop the appetite and model to assume the risk of running a consumer-facing service.

Until the last 2 years or so, the content owners have also been licensing content to Netflix at low prices -- nobody else was interested in their library content so it was a way to monetize the long tail. But now that Netflix has established that consumers are willing to pay for the content, the content owners are raising prices significantly because the content they own had more value than they initially thought. The existential threat to Netflix is not rising distribution fees, it's rising content licensing fees.

I am not disagreeing with you in general, but for me Netflix really could be a replacement for traditional channels. Not too OT: I am visiting my Dad and yesterday morning we saw the new Godzilla movie in IMAX 3D and later last night watched Hitchcock's "Dial M for Murder" which was such a better experience than Godzilla. Old movie/TV technology done artfully beats less artful tech. Netflix can deliver old and some new content cheaply and on my time schedule.

Yeah; there is more than one use case for viewing video, one of which is on-demand video. Netflix does really well there. But it doesn't handle "event" TV (think sports events or American Idol) or the "I'm bored and don't want to have to think about what to watch" use case. Those two are huge, and while I think that eventually those use cases will change generationally, the 30+ demographic isn't likely to change their viewing habits any time soon.

Suppose Netflix has profit P, and AT&T charges them X. Netflix has the option of not paying AT&T, which could cost them (P-X) and cost AT&T X. This gives Netflix leverage to get AT&T to lower the price.

Actually going through with this threat costs both companies money, so they will likely work out a mutually acceptable division of profit without doing so. However, if one company thinks the other is bluffing, they may try calling the bluff.

Also, this likely means more expansive for end users.

Exactly, see Pandora for a current example of this "just profitable to be in business" model.

They can and will jack up their prices regardless of net neutrality.

but... with no neutrality, they can raise their prices to multiple sets of people - people who right now aren't even their customers directly. It'll be quite a win.

I disagree. If that happens, a new solution will emerge to replace the telecoms. To name a few, decentralized DNS, open wifi, google fiber etc.

The United States is too big (in terms of population density) for a replacement solution to gain traction outside major metros without massive government subsidies.

It's cool to think as techies we could come up with some massive disruption technology, but short of a super blue sky type project, our best bet to leave a better internet to our children is to throw money into tech lobbying.

Regardless of technology who is going to build it? Techies? A large portion of the high speed internet we have today was done with private investment, the same goes for all that cell power out there.

The government hasn't spent nearly as much on infrastructure as private business yet far too many think that the same government who cannot maintain highways and bridges sufficiently would be best to handle the internet? Even city governments are scrambling to fix sewer and water systems they invested in ONCE and left to rot.

I still don't see the value in investing so much in broadband other than cellular. Wired solutions require far too much expense, meet more regulatory hurdles, and simply isn't quickly deployed. With all the small businesses available, let alone franchise businesses, there are millions of locations across this country to anchor transmitters. The big stumbling block is the cash to start it all.

Actually the US government spent quite a lot on the infrastructure. Around '97, I moved from Sweden to the US, after running an ISP there since '93. Since it was an obvious concern I checked and the US was pumping in slightly more per capita, while being ~40% more population dense. So no problem (I thought) - if anything speed and availability will rocket up faster here. However, back there the government kept control of the lines (not entirely unlike US telecom). Net neutrality was kind of a given - obviously the government can't (at least without massive legal changes) give preferential speed to some peoples information directly (i.e. blatant censorship - if you're a private enterprise you can limit stuff like that, not so much if you're the govt). Back home things rolled along swimmingly, the same crew I ran with back then are still online, some of them whining that they haven't pulled gigabit fiber into their areas and have to settle for 100 megabit symmetric. Even before the millennium 10 Mbit symmetric fiber was becoming pretty normal all the way into residences. No one really pulled copper wire for comm anymore really, if a new line went in, fiber. Need to redraw power lines? Throw in fiber. Water? Fiber. Just dug up a sewer line? Throw down some fiber, you never know..

Here? I can get 20 Mbit (5 down) in a fairly large town. Some cities have more, but I've seen none where 50 or 100 Mbit symmetric is considered the sort of "lowest tier" broadband (kind of like "at least it's not dialup"). For only 2-3x the price. Why? Because no one with the peoples actual interest kept the reins, they just handed shit over to the six majors and told them to get building. Why would they, when they're already competing against no one but themselves? Cuts into profit, stuff like that.. So you get to pay more in tax dollars for it, more for the service itself and it's way slower. The same seems to be true for korea (et al, the other fast nations), they're not spending more, they're just negotiating harder with those contracted to build it. Now, Sweden is talking about selling it off (since the whole place is shifting right). Predictably, prices are going up and speed increase is stagnating. Idiots, all of them. The free market rocks for optimizing low entry threshold fields and optimizing already existing solutions. It's horrible at things that are mostly infrastructure based, with high cost of entry and nearly all costs being in fixed infrastructure improvement chunks. Highways, telecom, power, water, etc all work the same - if you want to run them free market style, prepare to suffer until you decide to simply join forces and run it jointly without a profit goal bidding it out in small enough chunks to make actual competition possible.

Well, history repeats itself. See the mobile phones for cellular networks (aka GSM). Made initially by Motorola, the technology spread all over the world and the US networks were actually lagging behind everyone else for quite a while.

> The United States is too big (in terms of population density) for a replacement solution to gain traction outside major metros without massive government subsidies.

Thankfully most people live in major metro areas.

Use this as a perfect example to explain to people why Net Neutrality matters.

"What incentive does AT&T have to bring you good streaming experience for Netflix, Hulu, or heck even Youtube when they'd much much MUCH rather you were buying DirecTV from them?"

AT&T - and most major ISPs in the USA - already offer TV service. It's true that these consolidations will only give the big players more power, but the conflict of interest already exists.

And ATT already provides horrible internet service and doesn't care!

Defeatism!

This answers your rhetorical question:

http://about.att.com/story/the_chernin_group_and_att_create_...

Because I'll switch to Comcast or Verizon if I'm an ATT customer and their internet service is bad?

I mean, I don't have an option to switch away from Comcast because their internet service is bad.

That's why they can refuse to upgrade their peering with Netflix in the first place, because they know I'm stuck with them, when I'd dump pretty much any ISP who didn't upgrade their peering with a major website that I visit (in like 3-4 months) if I had the option to.

Comcast, Verizon, AT&T, and Time Warner all serve different cable networks. They rarely overlap, so you don't have that choice 99% of the time.

And it isn't really implicitly evil, because they just own the coax in the area and it obviously is not worth the investment to lay redundant wires.

>they just own the coax in the area and it obviously is not worth the investment to lay redundant wires

Sooner or later, this sort of thing must be addressed with a "public utility" perspective in mind -- not just in US but here in Europe as well. Why can I use different gas providers, or different electricity providers, or even different water providers in some countries, without pipe ownership being a factor? Answer: better laws. A degree of resource-sharing is forced upon providers by law, for the benefit of consumers.

> Because I'll switch to Comcast or Verizon if I'm an ATT customer and their internet service is bad?

Because Comcast is known for the high quality of their internet service? They all have the same incentive to degrade streaming services that compete with their TV packages. You're assuming that they won't each behave the same way even though doing so is to their collective benefit.

Even if this nightmare scenario plays out, I would gladly trade 5-10 years of bad service that would have VCs and entrepeuners scrambling to provide people what they actually want, and thus creating real new alternatives, as opposed to the Net Neutrality détente that keeps customers and providers antagonistic towards each other. Because thats really what the current plan is, to force ISPs to continue hating their customers and solely providing them with the current level of mediocre service by legislative force.

Think. How would the content providers - any of them, from Disney to Facebook - get their content at the consumer without the data-distributors, from Comcast to AT&T ? The saying is internet kills the middleman, but this is the real middleman that needs to be killed, and just as our roads are free and open to everyone, so should the digital roads be.

Comcast and AT&T aren't the middle-man. They build a necessary part of the infrastructure necessary to get content to the consumer. They're no more the middle-man than FedEx or UPS. Companies like Netflix, etc, are the middle-men: selling other peoples' content over other peoples' wires.

Vis-a-vis roads: the public pays for the roads, while the cable networks have been almost entirely built with private money. Transportation is also a good example of why you probably don't want publicly-funded telecom networks. Older suburbanites vote, younger people don't. That means we have tons of highways out to the suburbs, and decrepit public transportation.

My parents switched from FIOS back to DISH because they missed their low-res Indian channels. They'll be the people voting to decide how much public money to allocate to broadband. Will you be happy with their decision? Especially now that states and cities are out of money? When push comes to shove and it's shoring-up public pensions versus building broadband, where will the money go?

Roads aren't free, we pay for them in taxes and tolls.

When people say "free and open", that's context enough to know that they mean free as in freedom, not as in beer. Please stop using this silly red herring.

I honestly didn't perceive it as "free as in freedom" in the above context.

That said, roads aren't that, either. Try driving on one without a license, insurance, using them in ways that are disapproved of / disallowed (speeding heavily, drinking and driving, etc) to see. Alternatively, use the road to play a game of football. I don't really think they're "free as in freedom", either.

Stop it. You're being purposely obtuse if you're trying to equate freedom as the freedom to do crazy and nonsensical things versus freedom as a sense of liberty for people to access information, resources or services (regardless of if it's in the context of the Internet or public roads).

Your argument is in the same vein as people who try to win the debate over if we have freedom of speech or not by saying we don't because we can't yell "fire!" in a crowded movie theater. Context is everything; you can't just ignore it conveniently because you're trying to save an argument that you made under a misinterpretation. Why do we have the 1st Amendment? Because the founders wanted to preserve the ability for people to make politically averse opinions in opposition to those in power, not because the founders wanted people to be to somehow able defy the laws of the natural world.

People are fighting for a free and open Internet, because it has value in being able to quick access to important and useful information without restriction, not because of some super-literal definition of "freedom" or because we want it for 0 dollars and 0 cents.

>just as our roads are free and open to everyone, so should the digital roads be.

Nobody is arguing that internet access should be gratis. How could you possibly perceive it as not meaning "free as in freedom?"

Let me know when you're effectively prohibited from driving at all, because I pulled on to the road before you did.

OF course they are not really 'free', but does Amazon pay toll to get things delivered to you? Do government bodies who maintain the roads, tax large suppliers to make use of them?

Only in the sense that commercial trucks pay higher taxes. They pay that whether they're driving empty or full though, so the analogy falls apart.

The answer to your question is yes. The bulk of highway construction is funded via a gas tax. The more you use the roads the more you pay for them.

Do many young people watch TV anymore? It seems like netflix + youtube scratches that itch.

Sports. ESPN + NFL Redzone + TNT + Local channels in HD have no good alternative on the internet. If they did I wouldn't pay for TV.

Yes! Cable = Sports. If they somehow decouple those two then I'm all Internet.

Cable = Sports is why I am not watching ANY sports other than little snippets I can grab on youtube or mlb.com. Seriously. Have not watched a full game (definitely not MLB, NFL, NBA) of anything in a LONG time.

And none in family (yes little kids too) are watching much sports on TV either. Definitely not enough to grow up to be a fan of a particular pro sports league or a team, other than soccer via AYSO.

IMHO pro sports commissioners should start thinking about how less and less young kids are exposed to sports via TV (because not much to watch on non-cable TV) and what that means for potentially smaller fan base in the future. Just my 2 little cents...

What's funny is I would sign up for MLB.com in an instant if I could watch the local game but they block that so I'm out.

I don't have cable anymore, but watch most of the games with a buddies Comcast log in on my iPad.

Which is the most infuriating part... I have NBA League Pass, live in a separate TV market (same state) from my preferred team, but still a large percentage of games are blacked out.

If someone (Apple/ Amazon/ startupX) figures out how to get great live sports content on demand to consumers, they will have an amazing company.

This was my frustration also. It surprises me that they haven't worked out an arrangement to either make that feature an upgrade or worked out a way to make financial arrangements with (I'm guessing) the people who have broadcast rights for a market.

Get a VPN or use a DNS "hack" ...

My one regret with cutting the cord was that I gave up my precious Red Wings. NHL.com has a yearly subscription to watch the games online, but paying for that meant that I would have paid just as much for cutting the cord, as I did for having cable.

Really? Isn't it only like $100 for the entire year?

last time I checked it was $165. not a significant sum, but enough to mostly cancel out what we were paying for cable

I highly doubt you were paying $14/mo for cable TV.

I can't believe you're making your children suffer as part of your ideological war against cable companies. Think of the children and pick up that phone and dial 1 - 800 - GETTWCCABLE now!

MLB At Bat

NHL Gamecenter

NBA League Pass

NFL Sunday Ticket (currently DirecTV exclusive via contract)

* I am assuming you are American and/or care only about the four major sports in the US. Not sure about futball, rugby, cricket, tennis, cycling, etc

MLB.tv only works for out of market games, and worked amazingly when I was in school across the country, but useless when I moved back, and I got a free subscription to stream NFL Sunday ticket for the season and directv had basically no competency in streaming so it almost never worked.

Honestly, I bought a TV antennae from best buy and a long HDMI cord for my laptop and that's satisfied all of my sports needs through OTA broadcasts and questionable streaming sites.

I, too, use questionable streaming sites (well, just one since it's been reliable for the last year or two), but the picture quality is often worse than standard def, and the sound is apparently funnelled through a tin can.

It's almost bad enough to make me want to pay for cable. Almost.

Unfortunately for me, I live in Canada, where OTA stations do not care about the NBA. And I refuse to buy the League Pass since any games broadcast on cable would be blacked out.

NBA League Pass is a horrific abomination. I was debating it, and came across articles that showed that depending on your location and nominated team(s) it could be nearly impossible to get more than 25 games for your favorite team (out of an 82 game season). 30% of the season showed on a "Season Pass" costing approximately $200? No thanks.

Spend $5/mo on unblock-us.com and you can see every "blackout" game...

Check out ballstreams.com

You have to understand that Cable and Sports is a mutual lovefest. So all of these online alternatives are designed to be incremental revenue streams and specifically designed not to cannibalize the main revenue stream. They're mostly targeted at people who may away from their home market and so can't watch their favorite team on local cable.

I've been a subscriber to NHL Gamecenter for two years. If you're very far from your home team, it can be a good deal.

In California, I can catch most of Detroit's games. In a major hockey market like Toronto, however, Detroit's games are often on TSN2 (think ESPN2), which means they are blacked out. Cable was the only way to see these, even though I would have guessed they were out of market.

I'm pretty sure those don't include playoff games though and they also block out local games.

As much as I want to believe in these kinds of live sports services, I'm always disappointing in the quality and/or reliability of the feed. Maybe it's my ISP, I don't know. But for me streaming seems to be a second class citizen compared to cable & satellite.

As for the merger, I hate it because I actually think DirecTV is a pretty good product - even though the price is a bit high. I don't think a merger will do anything but reduce the quality of service, increase the price or both!

"Maybe it's my ISP, I don't know. But for me streaming seems to be a second class citizen compared to cable & satellite."

Don't worry - once your ISP is able to charge each streaming service more money, they might be able to budget to upgrade to slightly faster service a few years later.

For NHL, I've heard Gamecenter has poor quality feeds. Ironically, there's a one man show who runs a better service - albeit unlicensed - at hockeystreams.com

$20 per month, all games streamed in HD plus your choice of broadcast options (ie- home / away feed on NBC or TSN, etc).

FWIW, Gamecenter has had decent feeds for me; it annoys me that the browser viewer won't play the best quality (it only does 3Kbit, 30fps I think), but the ipad app will play 60fps HD streams. Missing blackout and playoff games is the worst though.

Aaand for the sake of posterity, that's actually 3Mbit. 3Kbit video doesn't really make sense.

Well depends, http://www.verizonwireless.com/wcms/consumer/products/video....

So if you use Verizon wireless you can stream from your tablet all you want. I think other ISP are doing the same too.

Do you get ESPN3 through your ISP? It covers most sports both live and recorded, and doesn't require a cable subscription.

Most sports? Hardly. Sure you can, in theory, watch American Football, Rest of the World Football, basketball, and baseball on ESPN3, but if you want to see these sports played by teams that matter then you need regular ESPN or a cable subscription to view them. All the games that matter were removed from the ESPN3 lineup at least a couple of years ago.

It shows pretty much all college sports (at least, all of what's broadcasted on cable anyways -- and then some). Sometimes there's a blackout on a game, which is annoying, though....

It's just not that great for professional leagues.

ESPN3 access gives you access to all espn channels including regular espn. I use it every day for sports center and baseball.

I'm unable to access ESPN's live feeds without a login provided by my cable company. That login flags what ESPN channels I pay for so, for example, I can't watch ESPN U without paying for an upgraded "sports" package filled with garbage channels.

I do have access to some live and recorded events, but the selection is limited to filler content like college volleyball and minor league soccer. Another plus is the ability to use my neighbor's login without restrictions since our cable provider's flagging system is piss poor. As long as I know somebody paying for cable I can cheat the system.

This is not true. Unless something has changed recently, college football on ESPNU is not shown on ESPN3. This has caused more than one game I cared about to be (legally) unviewable for me.

Are there ISP's streaming ESPN3 without a cable subscription containing ESPN? My local options both require you to subscribe to a TV package.

Even if my ISP had a deal for ESPN3 service, I would not use b/c it's a slap in the face to net neutrality.

Why else do you think the WWE Network is such a huge deal. It's the first huge step for sports entertainment.

or split a cable sub with someone and use it to log into live events. everyone wins!

Lol,

I don't "pay for TV", literally don't owe a TV, but surprise, surprise, someone charge me for it.

Young people don't care about sports either. eSports like they have on Twitch.tv are more and more popular.

A $35 leaf antenna from amazon gets you all the local HD channels for free.

Your first statement is absolutely ridiculous. Do you have data to back this up? I'm not in some "~esportz~" community - but I'm not in a sports community either, and you know what happens to my facebook when an athletic game is on? 20-30yo people talking about it in a massive flood. I have, as far as I know, never seen any of my friends (general Austinites of various walks of life) mention esports.

If you're referring to the 12-15yo crew; they don't pay cable bills anyway.

If 20-30 year olds aren't paying for television, is it because they don't want to or that they can't afford it? Narrow the criteria to people under-40 who own a house and I'd expect a much larger subscription rate.

The 20-30 group that is familiar and accustomed to streaming services, or even the basic Netflix delivery service (circa 1997) is not even remotely similar to the generation of kids born in the 70s. And the same goes with the 70s to the 50s. Who still has landlines? Those over the age of 45. (OLD graph but good info; http://ww3.hdnux.com/photos/07/74/73/2084546/7/628x471.jpg) They've spent most of their lives with land line phones being the most common means of long distance communication. It was considered essential. Cable is not considered essential to this up and coming generation (millenials) even more so than it was considered not essential to my generation.

Why are you assuming that you need to be 40 and a homeowner to be able to afford $35/mo cable? I'm 29 and have never once in my life paid for cable. I'm an engineer and own. I use Plex with Rokus and Chromecast. Prior to these devices I used Netflix mostly, they started streaming in 2007 but from 1997 to 2007 they still had a fairly decent delivery service.

Sports are pretty much the only TV I watch anymore (for the most part) and I stopped paying for cable as soon as I graduated from college (it was included in my rent payment at my apartment down there, otherwise I'd have done it sooner). There are other means to watching sports -- Sunday night NFL games are on NBC.com, for instance. Every college sport is broadcasted on ESPN3, so you can just get a couple of people together to buy a cheap subscription and use that to watch ESPN3. The only ones I miss (or, alternatively, use sketchy streaming sites for) are midday NFL games.

Young people don't care about sports? Wow.

The people who say "get an antenna" must have never seen a mountain or high-rise building before. Television signals require line of sight and if you're unlucky enough to have a sizable obstruction between you and the transmission tower then you're out of luck.

Reasonable line-of-sight. Radio waves _will_ bend around modest-sized obstacles, though remote or mountainous regions are clearly disadvantaged.

That said: most large population centers tend not to be remote and/or mountainous.

I'm embarrassed for people that post about spectator sports on social media.

I know, right? People wanting to talk about a common subject among their friends via social media!! And those people talking about the weather in the elevator! Simpletons.

Apparently I'm not?

I'll speak for the late 20's Crowd (although I just turned 30..) No one in my age group, that I know, watches sports at home. If they do, they go to the bar to do it.

ESports are MUCH more interesting for at-home watching.

Consider this - does any individual esports team make anywhere near what Lebron James, individually makes, including his salary and all his various sponsorships?

Its easy to sit in your SV bubble and claim such a thing but live sports is huge. ESPN alone is considered to be the most expensive sports channel [1]. Lets be real, how many American children are aiming to be the next Lebron James vs Fatil1ty (how many young people know who Fat1lity is?)

Esports might be more interesting for you and your friends, but lets make sure that we aren't projecting our preferences on 300 million Americans.

[1]http://www.npr.org/2013/08/07/209820647/the-history-and-futu...

Your anecdote is not representative of the whole. You have certain interests and your friends share them. The NFL (not to mention the other major sports) is huge with young people. Much larger than your e-"sports".

A lot of people your age will eventually have children or will no longer find going to the bar regularly that enjoyable.

If you look at how much money major sports franchise owners are spending on improving the in-game experience for fans, and listen to their thoughts on doing so, it's pretty clear that they are fighting hard to get people to actually come to games rather than watching them on TV.

NFL Football is the most popular sports league in the US and quite frankly, I find the product to be almost unwatchable live compared to television. I think basketball and hockey are much more enjoyable in person, but that's also expensive and more time consuming than seeing them on TV, and both leagues play around 80 games a season, I believe.

A useless data point, but I'm 32 and never heard of eSports until this thread.

Lastly, consider this: Twitch is selling for $1 Billion dollars. The average value of a single(of 32) NFL team is more than that and television networks are paying the NFL several billion each year to broadcast games.

I'm just curious if the downvote is because I'm 30 or because I spoke against sports?

I upvoted you, but I'm guessing people are objecting to your attempting to "be a spokesperson for the late twenties crowd", when I think your case is exceptional. I'm mid-almost-late twenties and I've never heard of "watching e-sports" or twitch.com until this thread. I've seen speedruns of half-life on youtube and such, but I had no idea people actually seemingly stream live video game competitions. I have a wide circle of friends in their twenties and thirties, and I've never heard of e-sports.

I agree though, that live sports are mostly watched at bars by friends in my age range. I only have DirecTV because it's "free" (included in hoa fees), but I still almost never watch "live" tv. I just watch DVRed shows instead of on Hulu now. Sports, especially NFL, are still huge as I can see by my facebook feed during big games or the draft.

Heck, I didn't know what a touch down was a few years ago, but sports are so popular among mainstream (ie: non techies) I had to learn enough to pretend to be interested to fit in socially, and eventually I started actually enjoying watching and following the local teams. I suspect there may be a bit of an echo chamber in some communities that don't care about sports, but I'd wager the among the majority they are still very popular.

I downvoted you not for the opinion (which I do happen to disagree with) but because you're making the mistake of taking your own anecdote and assuming it implies everyone is like you.

Among me and my friends, nobody likes rap music, ice hockey or nightclubs, doesn't those 3 things aren't incredibly popular among many people.

It's probably because you're 30 and watch esports. I didn't downvote you, though. Most of the people I know who own houses stay home to watch games but that's mostly due to the fact that they've had to move out of the urban areas to purchase.

It is probably not something you can extrapolate on but I know a couple of people who watch ESPN SportsCenter every single morning (as far as I know).

The downvotes are unwarranted, but my guess is: it seems like you're claiming that no one in your cohort watches sports based on your anectdata. A claim which is likely out of touch with reality. I upvoted to hopefully even out your score.

Do you mean live TV, or just having cable at all? I don't think I've watched live TV in 10 years.

I'm looking to cut my cord, but the problem is that nothing legit is as convenient as the cable+DVR setup. With those 2 things I have access to practically every TV show on the air (minus Netflix exclusive stuff).

To have access to that wide of a library without cable I need Netflix, Hulu, Amazon Prime, iTunes (and Pirate Bay for the stuff that's just impossible to get). There is not a single (non-computer) device that can play those all on my TV. So it's a bit of a hassle, screwing around to find what service on what device has what show and then remembering when the new ones come out.

Compare that to the stupid, but venerable, DVR where every show I want from whatever random channel just shows up when it comes out in one clean interface.

I want to kill it so bad but from a UX perspective, it's just so much better.

Really, the only thing that gets close to that experience at all is flexget[1] + a private torrent tracker. How sad is that? It really should be a huge kick in the nuts to all the legit streaming services, but I doubt that they even care... DRM just ruins everything. Sigh.

[1] https://github.com/Flexget/Flexget

I think it's really shifting away from TV. As a college student, my friends and I have been completely satisfied with Netflix and the like. I can confidently say that there is nearly a 0% chance I'll be getting cable/directv/whatever when I can just get Netflix/Hulu/etc instead.

Don't most ISPs make it economically infeasible to get internet services without also getting cable TV? Comcast here bundles servies such that internet only is more expensive than internet + cable.

Yep, this is the case here as well. Paying Comcast for TV + internet because it's $15/month cheaper than internet alone. The cable box they sent me is sitting unpacked in the closet.

What I do is call them and outright refuse to pay more for just internet. I tell them to lower my bill to below that each year my "promotion" expires. They forward me to the "Loyalty" department and somehow find a new promotion for me each time.

Fuckers.

> Fuckers.

Interesting, do you have another provider in the area?

I think a lot of the negotiating power comes from the ability to threaten to switch to <competitor>. If they know there is nobody else (and in many places in US there isn't), they can often say "yeah sorry to see you leave", knowing that you can't really go anywhere.

I have for example been oscillating between two local providers. Both have equipment on "premises" installed and just have to switch it on and off. So as soon as one ends promotions, I switch to another and do so on. Sometimes they give me the promotion rates back without having to go the full switch around the circle.

Promotions usually run 6 month to a year.

I used to get the promotional rates re-applied every year. Now they just flat out refuse. So I cancelled my cable to call their bluff but I had to keep the internet because I have no other option. Never got a call from customer retention. So now I pay the same amount for comcast internet + directv but I refuse to switch back to comcast just because.

Not really.cthere are competitors but they suck too. I use reason with them most of the time. Once You Are transfered to the loyalty department it doesn't even matter. In some cases, just ask yo be transfered to loyalty. Losing $30 a month per customer isn't worth losing the customer or the negative social media.

Can I ask where you live, and how much you pay? In the bay area internet only is marginally cheaper than any bundle. $99 for TV + 25mbps and between $66 for just the 25mbps. Teaser rates are $59 for the bundle, $29 for internet.

I live in Kirkland (a suburb of Seattle). Paying Comcast $50/month for "Blast Plus" which is 50 mbps + TV, while it's ~$69 for just 50mbps internet. Both are "promo rates" (aka call the retention dpt. once they run out and you'll get them for another year).

$69 for internet is the full price, not the promo teaser rate. The promo rate is $34 (see linked image). I don't know if you can get the promo rate if you aren't a new customer though.

http://i.imgur.com/dPqlKR2.png

Welp, that's new since I signed up. Will be calling them tomorrow - thanks for pointing that out!

Kirkland resident here, too. Have you looked into Frontier FiOS? We pay $40/month for Internet, non-promo and no TV. (I don't think they've laid fiber optic to every neighborhood in the city yet.)

Frontier's awesome, but they're not available in any apartments in the area and they've ceased fiber expansion a few years back :/

Here in Central Florida Brightouse is very strict and internet alone is more expensive than bundled. However, after only a month on $130 bundle with ATT, I've "threatened" them to switch into Brightouse (bluff), because I needed cheaper plan and they gave me a $45/month/no contract internet-only plan for 12Mb download.

Its possible that you would achieve the same with BH, but at least ATT hates when you mention competitors, and they make so much money that they would rather make less on you, than lose you big time, knowing once a customer is gone, his/her re-acquisition is very expensive. At least this is my experience. I had an impression that I could push it even harder and call again, complain and they would lower my bill even more before finally dropping me for good, but I am already satisfied with my plan.

Edit: tl;dr - always bluff with your cable provider that you drop them b/c they are expensive and see how far you can get. Most likely your $150 bill can be cut 50% and they still will make money.

This was the case for me historically as well, but I recently got an HD antenna to avoid paying the fee for digital and told them I didn't want the box. They somehow unbundled them and now I have a more expensive data plan for the same overall cost, and no TV listed anywhere on my bill. I have no idea if I'm practically any better off, but it's nice not feeling like I'm paying for something I'm not using.

The promotional rates work like that sometimes, but if you get the lowest, lowest grade of internet- at the normal non-promotional rate, it is a good deal cheaper than the bundles.

Take my service for example. $40 standard rate (promo was $30). There ain't no bundle out there that runs $40 once the promo period is up.

Between YouTube, Twitch.TV (and related, like Azubu, Speedruns, etc), Crunchyroll, and occasional piracy (GoT), I never turn on my TV unless it's the Chromecast the aforementioned content.

Well, your comment quickly became outdated.

This is why they want a tiered internet. They would make a tier specifically for streaming sites, and a discount if you have cable with them.

Yes. Except now the shows are timeshifted and streamed online.

I dont watch TV at all. The Set top box is lying around without being switched on for last 1 year.

You mean Netflix + Youtube + (the thing we are not mentioning)

You cant get the same content in the same quality from places like Netflix or Youtube.

I like to watch new shows not reruns of shows/movies I have already seen, most of the time I have seen them multiple times. I am looking at you netflix.

Are you really questioning whether Game of Thrones is popular? Of course people still watch TV. A lot of them just pirate it.

No. I have not paid for TV since I move out of my parents house 4 years ago. I have 0 plans to purchase TV ever in my life.

Even for sports, there are numerous online streams (though illegal) that I will make use of to keep up with critical games like the NBA playoffs.

Other than that the content on TV is garbage, and all the good content I can pirate easily or watch on Hulu/Netflix.

Cable companies are fucked.

I don't know why people pay for food when you can just shoplift it, am I right?

I would love to pay for online streams and content online. I just don't want to pay for cable.

Content producers need to take note and provide their content in ways that are easily accessible and in ways that I can easily pay for.

I WANT to pay for content.

This is getting dangerous. Imagine a world where a public transportation company owns the network of roads too and denies any other transportation company to come up besides their own.

Not a perfect analogy, but this may be of interest to you -

http://en.wikipedia.org/wiki/General_Motors_streetcar_conspi...

There's no way this can pass, especially with the Comcast/Time Warner deal still in process. Maybe this will scare regulators into denying both deals.

Doubt there will be any regulatory grumbling since it actually increases competition in the "triple play" space (Internet+Television+Phone). My hunch is that AT&T waited until they thought the Comcast + Time Warner deal was a virtual certainty before pulling the trigger on this. Who this will put more of a squeeze on is content providers (e.g., Disney/ESPN) as they now have to deal with two juggernauts.

Call me cynical but I can imagine a golf-course deal where Comcast and AT&T agree to this. Theory being, AT&T+DirecTV will seem like a more-meaningful competitor for Comcast+TimeWarner.

Why not? AT&T has a fraction of the video subscribers that DirecTV has. They're not a major player at all.

If you really want to avoid AT&T, then Dish still exists as a robust competitor.

Unlikely considering Tom Wheeler was both companies Chief Lobbyist.

Maybe it will scare another 10 or 100k out of a lobbyist.

wow, I thought you meant "million"? You don't just buy a company for $48.5 billion, and have a tiny matter-of-fact headline like this.

What's the last company that got bought for even $30 billion!

This is a mind-boggling sum of money.

Check out the largest mergers and acquisitions of all time:

http://www.bloomberg.com/visual-data/best-and-worst/largest-...

(Do bear in mind inflation - add 45% since 1998 according to http://www.usinflationcalculator.com/)

This deal must still be way up there. I wonder if someone can find the largest acquisitions of the past 2-3 years.

There have been a lot more, even recent ones... http://www.businessinsider.com/16-biggest-acquisitions-of-al...

Thanks.

As you can see #16 as listed is in the ballpark and actually it says in your list's lead paragraph that #16, which is what prompted your list article, was for $45.2 billion. (So, less than this deal.) They get their ultimate figure by adding debt the acquirer takes on (as is typical). Including debt, our article actually says "Including the assumption of DirecTV’s debt, the deal is worth about $67.1 billion" so just a hair shy of #16 on your list if you include the debt.

Either way, this is an absolutely mind-blowing deal in nominal terms. (As are all sixteen on your list.) This is a huge amount of money by any standard on Earth.

Net Neutrality is a ruse: providers "promise" to maintain an SLA against their competitors when they still own the last mile, and the service, and the core network. In practice, SLAs are weak sauce.

The more viable competitive model to me would be to a mandatory Open Access Network.

http://www.opennetworkforum.org/what-is-an-open-network

1. Spinoff of existing Big telcos own the core physical fibre or RF infrastructure

2. Various network providers own and operate active equipment & billing on the network - no one owns the last mile

3. Various service providers provide content & applications on the network.

4. No company performing one role can compete in another role, so as to avoid monopoly

This of course will never happen in the USA because the inmates are running the asylum.

So we'll have to rely on countries like Sweden to prove it out:

https://www.acreo.se/sites/default/files/pub/acreo.se/EXPERT...

Is this acquisition from cash that AT&T hand or would they go to a bank and work with them for capital?

$28.50 of the $95/share is cash while the rest is AT&T stock. From the PR release[0], "AT&T intends to finance the cash portion of the transaction through a combination of cash on hand, sale of non-core assets, committed financing facilities and opportunistic debt market transactions."

[0]: http://about.att.com/story/att_to_acquire_directv.html

The graphs in the article are really good and clear, matched scale across the different graphs, enough years for context. I hadn't realised that US cable really was declining on such a scale rather than cable cutting being something more talked about than really happening.

Next up AT&T + Comcast merger... 'Cause why not?

That won't happen. Comcast + Verizon, perhaps.

This is interesting. My building has tv/phone/internet via DirecPath, a fiber based isp now owned by DirecTV. The only alternative is via the local telco, AT&T. Will be interesting to see how this plays out.

S. Derek Turner's take: http://www.savetheinternet.com/blog/2014/05/19/why-the-att-d...

"So for $67 billion, AT&T could pass 71 million new homes with gigabit fiber, and connect 21 million new subscribers (assuming an industry-average 30 percent take-rate)."

I'm surprised Apple didn't get into this recent movement of communications company acquisitions. For 1/3 of their cash pile, they could have streamlined control of not only the devices (tablets, phones, tv's) and the content market place (itunes), but also the infrastructure to provide media and telecom services through possible acquisitions of time warner, directv, and/or tmobile.

There are rumors of partnership with Comcast (which is looking to merge w/ Time Warner)

It's almost like the industry wants the government to step in on anti-trust grounds.

Wait a minute...

Put that WhatsApp acquisition in your pipe and smoke it, Zuckerberg.

This acquisition is actually pretty easy to make sense of, unlike WhatsApp acquisition of Facebook. This is a company which made USD 31.7 Billion in revenues last year[0].

[0]: http://www.sec.gov/Archives/edgar/data/1465112/0001047469140...

A 30 engineer + 20 support staff company, I still bet they have a higher $/employee ratio.

Ridiculous that these things are allowed in the US. So for all your media needs there'll basically be only two providers some day - at&t or Comcast. Pathetic

You have to wonder how much the NFL Sunday Ticket was worth as part of this transaction.

Not very much considering it's up for renewal at the end of this year. There have been some fun rumors about who is in the bidding, including Google.

http://www.bloomberg.com/news/2013-12-12/directv-said-near-r...

If they can compete against the devil--Comcast; I'm all for this merger.

Markets with a small number of large players tend to converge in terms of pricing and strategy, so we may end up with a cozy oligopoly rather than any serious competition.

According to them lack of competition is good for the market. Maybe Zuckerburg can start a bandwidth company and bring another (desperately needed) player to the game.

How? Wireless?

That'd be at least 3 years away, if he could piggy-back on another network.

According to their Q4 report, AT&T spent about $50B EACH in expenses in 2013 on their wireless and wired operations. Zuck only has $25B (personally). How much of a network could he (or Facebook, after he gets shareholder approval) build? This isn't an app built in PHP or Objective C.

hopefully this will get blocked

Dinosaurs mating.

https://en.wikipedia.org/wiki/AT&T_Broadband

The cable/telco consolidation 1.0 play.

Is it bad that I read this as 'AT&T to Buy DirecTV for 2.7 WhatsApps?'

Yes. This is not only a trivial, inconsequential point to raise, but your arithmetic is also off ($48.5/19 \approx 2.55$).

You sound like a fun person to hang out with.

My arithmetic wasn't off. I misremembered the price by $1b.

Both industries are doomed. I'll stay tuned to see how this turns out in like 5-10 years from now.

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