Dallas, Texas 07/22/2015 (Financialstrend) – AT&T Inc. (NYSE:T) moved a step closer to finalizing its $48.5 billion acquisition of DIRECTV (NASDAQ:DTV) after it emerged that antitrust regulators are willing to allow the deal to go through. However, the wireless giant will have to agree to certain conditions that involve expanding its fiber-optic broadband service. The green light essentially ends a 12 months review process paving the way for the biggest media deal in the recent years.
Federal Communications Commission Chairman Tom Wheeler has already requested the five-member commission to approve the merger. The Justice Department has also given the deal its thumb of approval reiterating that there would be no significant risk to competition on AT&T Inc. (NYSE:T) merging with DirecTV.
People close to the talks say that AT&T Inc. (NYSE:T) is required to offer broadband services at set prices that low-income individuals can afford. The proposed merger has not gone well with the likes of Netflix, Inc. (NASDAQ:NFLX) and Dish Network, which believe the combined company could wield too much power, as a result, suppress competition.
AT&T Online Video Ambitions
The FCC has ordered AT&T Inc. (NYSE:T) to impose any broadband data caps it currently imposes on customers to its own over-the-top video service on merging with DirecTV. The move is intended to ensure a level playing ground that would eliminate any chances of AT&T gaining an advantage over its rivals. The FCC is reportedly planning to deploy an independent officer that will help ensure the wireless giant complies with the conditions.
AT&T Inc. (NYSE:T) reasoning behind the merger is that DirecTv will give it more exposure to programming relationships that it hopes to use to venture into the online TV business. Advancing into online-video is AT&T big play as traditional TV Faces uncertainty as more people switch to streaming content.
AT&T Inc. (NYSE:T) has already unveiled plans to offer an over-the-top video product as part of its online video adventure.