Early AT&T/DirecTV Merger Questions
Now that the consummation of AT&T's merger with DirecTV is done, how will this $40 billion-plus deal impact consumers from both parties and the TV world at large? Chances are you haven't heard much over that question up to now, in part because of how this deal was completed last week -- Federal Communications Commission approval mid-Friday afternoon, and AT&T putting out a press release, and only a release, of the consummation less than two hours later. That's way late for much analysis on the part of the business news channels or journalism in general.
Turns out, if you look carefully, there are several directions this venture can go which hold both immediate and long-term impact on the 20-million-plus U.S. subscribers of DirecTV and AT&T's five-million-plus customers of its U-verse cable overbuild. If you're not in either camp, don't head somewhere else so fast. Here's why, submitted, as Rod Serling would say, in question form:
- Will AT&T boost the budget for original scripted programming on DirecTV and bring those programs to U-verse? In recent years, DirecTV's Audience Network, or Channel 101, has turned into a home for such original series as Rogue, the Thandie Newton-starring spy drama (now in its third season) and Kingdom, the mixed martial-arts drama which became one of last summer's critic faves. More loot in Audience Network's direction could expand its scripted abilities, land clearance on U-verse and maybe other multichannel providers. (Here's a first step: Push DirecTV's public relations people, who have kept these original series in extremely low profile since last fall -- as in no information on DirecTV's Web site or not answering interview requests -- back into relating.)
- Will AT&T increase the production budget for channels DirecTV has equity in -- GSN, The Tennis Channel, MLB Network, NHL Network and regional Root Sports? GSN, for example, has improved its status with series like The Chase, Idiotestand Skin Wars. A nice spike in original series, along with the top prize level (as in beyond $200,000) can deliver more viewers and advertising revenue.
- Will U-verse's audience have access to NFL Sunday Ticket? All in AT&T and the National Football League's hands. Probably too late for this season. Next? Could be, um, in play.
- Can this venture turn into a national platform for the services upcoming through Otter Media, AT&T's joint venture with The Chernin Group, headed by former Fox and Showtime senior executive Peter Chernin? Remember, we're talking between 25-30 million customers automatically available for anything Otter develops, before taking the case to smart TV sets and smart TV-making devices like Roku and Chromecast. That base also can come in handy for Fullscreen, the digital video platform under Otter Media's control, with 50,000 content creators on its side (resulting in four billion views a month among 450 million people worldwide) and ambitious plans to join Netflix, Amazon and Hulu as a global scripted kingpin. Are we talking a Fullscreen channel or video-on-demand service down the line?
- Will this combined DirecTV/U-verse customer universe be tapped to try out new interactive services from banking to home device controls? Not out of the question, given AT&T's research and development resources.
The possibilities of these questions make your mouth water. Let's keep tuned to how soon AT&T provides answers.
Until the next time, stay well and stay tuned!
The opinions and points of view expressed in this commentary are exclusively the views of the author and do not necessarily represent the views of MediaVillage.com management or associated bloggers.
Simon Applebaum
Simon Applebaum has covered the TV medium for more than 38 years. Now a regular MediaVillage columnist, he produces and hosts Tomorrow Will Be Televised, a program all about TV, now in its 12th year. Previously, he was a senior editor for various TV-centric …
