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Fox-Time Warner News Colors Senate Committee Look At Online Video; Netflix’s Reed Hastings Declines Invite

By | Wednesday July 16, 2014 @ 2:25pm PDT

Fox-Time Warner News Colors Senate Committee Look At Online Video; Netflix’s Reed Hastings Declines Invite“We’re in an arms race,” Public Knowledge CEO Gene Kimmelman told the Senate Commerce Committee at a hearing to explore the prospects for broadband video. It’s “no surprise, content companies bulk up” as Fox wants to do with its $80B bid for Time Warner, which was rejected by the company but disclosed today. Following Comcast’s deal to buy Time Warner Cable, and AT&T’s with DirecTV, “consumers are between a rock and a hard place….They started the ball rolling and as we’ve seen from today’s stories, we don’t know where it’s going to end.”

Representatives from Comcast and AT&T indirectly debated with execs from Dish Network, the WGA, and Kimmelman over whether online video providers have to fear mergers or need strong net neutrality rules. Committee Chairman Jay Rockefeller (D-W Va) ended the proceedings by arguing for municipal broadband to provide a low-cost option for poor residents. He also said that he invited Netflix CEO Reed Hastings, who declined to show. “I can’t figure [it] out because I’m trying to help them, I think. But he didn’t want to be here.”

Dish says that later this year it plans to introduce a low-priced online video service that will include live streams of ESPN, and could be threatened by the union of the two largest cable companies. “Comcast doesn’t necessarily want us to succeed because we’re competitors,” says the satellite company’s Deputy General Counsel Jeffrey Blum. “We are very concerned that a combined Comcast and Time Warner Cable will have an incentive and ability to stifle our service.” Read More »

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TCA: ‘Kingdom’, A Show That Doesn’t Have To Fit A Certain Demo For DirecTV’s Audience Network

By | Saturday July 12, 2014 @ 11:15am PDT

TCA: ‘Kingdom’, A Show That Doesn’t Have To Fit A Certain Demo For DirecTV’s Audience NetworkDirecTV kicked off TCA‘s Saturday sessions with a look at its upcoming mixed martial arts drama Kingdom, which is premiering on October 8 at 9 PM ET/PT.  Most of TCA’s sked today is devoted to the programming from non-traditional networks, i.e. DirecTV’s Audience Network, Amazon, Reelz and Hulu. While most of the Kingdom panel’s chatter with creator Byron Balasco and castmembers Frank Grillo, Kiele Sanchez, Matt Lauria, Nick Jonas, Jonathan Tucker and Joanna Going was confined to the show’s staging of its fisticuff scenes, DirecTV SVP of Entertainment Chris Long expounded on how this edgy niche drama fits in Audience Network‘s wheelhouse.

“While our demo is adults 35-54 who are highly educated and from high income households, our programming slate doesn’t have to fit a certain demo.  We’re looking for TV shows that get out of the clutter. We chose Kingdom not so much based on the fact that it was a sport drama, but because we loved the script,” explained Long about the network’s road-not-taken m.o, particularly in the wake of acquiring Friday Night Lights. Read More »

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DirecTV Hits Al Jazeera America With Lawsuit But Won’t (Heavily Redacted) Say Why

By | Friday July 11, 2014 @ 7:19pm PDT

DirecTV Hits Al Jazeera America With Lawsuit But Won’t (Heavily Redacted) Say WhyI can tell you that DirecTV today filed a breach of contract complaint against Al Jazeera America. I can tell you that the civil case complaint demands a 10-day jury trial and seeks more than $25,000 but also is looking for declaratory relief. Finally, I can tell you that the 17-page filing by the satellite service provider has something to do with the Affiliation Agreement that DirecTV entered into with AJAM predecessor Current TV back on July 13, 2005, just over two weeks before the channel co-owned by Al Gore debuted. Beyond that, and who the plaintiffs’ lawyers are, virtually everything else in the complaint (read it here) is redacted. DirecTV reps had no comment when I contacted them about the blacked-out filing. Al Jazeera America weren’t saying much either. “We have not reviewed the complaint and therefore have no comment,” an AJAM spokesperson told me today. A non-redacted version also has been filed in LA Superior but is under seal, I’ve learned.
directv lawsuit copy Could this complaint be something similar to when Time Warner Cable dropped Al Jazeera America from its service minutes al jazeera america logoafter the Qatar-owned news channel bought Current TV for $500 million back in January 2013. Saying it didn’t consent to the sale, TWC jettisoned AJAM. The new station launched on August 20 that year, and a few months later the two sides … Read More »

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DeadlineNow: FCC Signals Hard Look At Proposed Mega-Mergers (Video)

By | Tuesday July 8, 2014 @ 12:58pm PDT
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FCC Taps Economist Who Opposed Comcast's Acquisition Of NBCUniversal To Oversee Proposed Mega-Mergers

Deadline's David Lieberman looks at the FCC's choice to oversee the proposed Comcast-Time Warner Cable and AT&T-DirecTV mergers.

Related:
FCC Picks Critic Of Comcast’s NBCU Acquisition To Review Its Time Warner Cable Deal

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FCC Picks Critic Of Comcast’s NBCU Acquisition To Review Its Time Warner Cable Deal

By | Monday July 7, 2014 @ 12:21pm PDT

FCC Picks Critic Of Comcast’s NBCU Acquisition To Review Its Time Warner Cable DealComcast needs no introduction to the economist who the FCC tapped today to help regulators sort through the cable giant’s plan to buy Time Warner Cable, and AT&T’s for DirecTV: Former FCC Chief Economist William Rogerson, now a professor at Northwestern University, was an important opponent of Comcast’s acquisition of NBCUniversal. He wrote at least three reports in 2010 that challenged Comcast’s economic analysis and concluded that the deal would hurt consumers. One, which he wrote on behalf of the American Cable Association, estimated that the reduction in competition from a combined Comcast-NBCU likely would lead pay TV customers to pay an additional $316.8M a year. That meant “the harm of this transaction is more than ten times as large as the benefit,” he said at the time.
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AT&T-DirecTV Chiefs Dispute Charges That Merger Will Raise Prices And Limit Choices

By | Tuesday June 24, 2014 @ 1:47pm PDT

AT&T-DirecTV Chiefs Dispute Charges That Merger Will Raise Prices And Limit ChoicesAT&T’s Randall Stephenson and DirecTV’s Michael White faced some of the toughest questions they’ve encountered yet about their companies’ planned $49B merger in two congressional hearings today. They repeated their view that the deal would lower costs. But Sen. Richard Blumenthal (D-Conn.) pressed them to add whether consumers would see a direct benefit in lowered rates. “Dollar for dollar? No, I can not commit to that,” White said. Stephenson also declined to be specific. “One would have to believe in the market and market pressures,” he said adding that “prices are changing constantly.” The senator was unimpressed. “I have this sense that we are watching a re-run here….A lot of consumers would find that unsatisfying.”

att logoSen. Al Franken (D-Minn.) had more luck pinning the AT&T CEO down to promote, as well as offer, a competitive stand-alone broadband service. In a 2006 deal to buy Bell South “you hid the [promised] plan deep in the terms and conditions in your web page…it sounds like a broken promise,” Franken said. Would AT&T promise this time to make the service clear and visible to consumers? “Yes, I will,” Stephenson said. “I will make you without equivocation that commitment.” The exec was less certain when asked whether AT&T had paid lobbyists to support state laws that bar local governments from creating their own broadband services, an option that Franken believes communities should be free to make. Stephenson says he doesn’t know whether AT&T lobbied against municipal broadband. He added, though, … Read More »

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DirecTV Drama Series ‘Navy St’ Gets New Title, Premiere Date

By | Thursday June 12, 2014 @ 9:38am PDT
Nellie Andreeva

direcTV__130523212608EXCLUSIVE: DirecTV’s upcoming 10-episode drama series from creator Byron Balasco and Endemol Studios will be called Kingdom. The straight-to-series project, previously titled Navy St., will debut on October 8 at 9 PM on Audience Network. Kingdom, which was written by Balasco on spec, takes place in Venice, California and is set against the backdrop of Mixed Martial Arts. It stars Frank Grillo, Kiele Sanchez and Matt Lauria, Jonathan Tucker, Nick Jonas and Joanna Going. Balasco is executive producing and serves as endemolstudiosshowrunner. Endemol Studios (Hell on Wheels), which has 12 scripted projects set up at various networks, produces, with its sibling, Endemol Worldwide Distribution, distributing internationally. DirecTV’s is currently airing the second season of original drama series Rogue.

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DirecTV & AT&T Hit With Class-Action Lawsuit Over Proposed Merger

By | Thursday May 29, 2014 @ 8:15pm PDT

ATT DirecTV logosCue the lawsuits over the latest media mega-merger. Less than two weeks after AT&T and DirecTV sealed their $48 billion-plus tie-up, a shareholder has filed a class action objecting to the deal. The suit filed Thursday in Los Angeles Superior Court (read it here) names as defendants AT&T, the satcaster and its board members, including former CBS honcho Peter Lund and ex-Fox Networks Group chief Tony Vinciquerra. In the lawsuit, investor Teresa Silvestri claims the purchase price for the satcaster is too low considering its long-term potential. “DirecTV’s recent financial performance is indicative of a company on the rise with growth potential yet to be recognized,” the suit reads. It also takes the board members to task. “In approving the Proposed Acquisition … the Individual Defendants have breached their fiduciary duties of loyalty, good faith, due care and disclosure by … agreeing to sell DirecTV without first taking steps to ensure that Plaintiff and Class members would obtain adequate, fair and maximum consideration under the circumstances and engineering the Proposed Acquisition to benefit themselves and/or AT&T without regard for DirecTV public shareholders. Absent judicial intervention, the merger will be consummated, resulting in irreparable injury to Plaintiff and the Class.”

Related: Is Peter Chernin Key To AT&T’s Deal With DirecTV?

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Is Peter Chernin Key To AT&T’s Deal With DirecTV?

By | Wednesday May 21, 2014 @ 3:33pm PDT

AT&T DirecTV Merger That’s the way it looks to me the closer I examine the transaction. Just last month the telco announced that it forged a partnershipwith former News Corp COO Peter Chernin, valued at $500M, to either buy or build a so-called over-the-top (OTT) online video service. That’s now potentially the biggest — and perhaps the only meaningful — new opportunity for AT&T if it completes its $49.5B acquisition of DirecTV. The satellite company’s CEO Michael White told analysts this week that OTT and mobile video could be ”big win-wins not only for us and our customers but also for our programming partners.”

Related: Peter Chernin Teams With AT&T In $500M Effort To Create Online Video Service

Chernin peterIt’s more than an opportunity — it’s a necessity for the two companies. DirecTV‘s domestic TV business is mature, and AT&T’s copper wireline phone network is becoming obsolete. The media world is now about broadband, and cable companies led by Comcast have pretty much locked up the part of the business that involves wired connections. About 83% of the 1.2M people who signed up for wired broadband in Q1 went with cable, Leichtman Research Group reports. DirecTV and AT&T can’t beat cable’s ability to transmit gobs of programming and data to home TVs and computers.

Yet AT&T’s wireless spectrum could put it in the pole position to sell video and Internet services for smartphones and tablets — especially when out of the home.

The problem? AT&T and DirecTV were slow to move, which gave their respective chief competitors — Verizon and Dish Network — a head start in the race to develop a national OTT service. Read More »

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AT&T CFO: A Bid For Dish Network Would Have Been A Tough Sell In Washington

By | Wednesday May 21, 2014 @ 6:33am PDT

AT&TLots of company watchers were surprised to see AT&T agree to pay $49.5B for DirecTV figuring that Dish Network — which has been amassing wireless spectrum — would be a more logical target for the telco. But it turns out that Dish chairman Charlie Ergen’s much-discussed but still nascent plan to create a wireless broadband service made his company less attractive. If AT&T tried to buy a potential competitor it “would be likely to raise additional regulatory questions and scrutiny, especially at a time when we have a couple of FCC spectrum auctions scheduled,” CFO John Stephens said this morning at the J.P. Morgan Global Technology, Media and Telecom Conference. He was careful to note that DirecTV was a first choice, not a runner-up, as he talked up its “premier” network, distribution system, content, and “premier people.”

Related: Consumers Group, Public Interest Org Respond To AT&T-DirecTV Deal

Stephens reiterated a lot of the selling points AT&T and DirecTV raised this week for the deal including their ability to offer content across multiple screens. Programmers will want to do business with AT&T because its reach in broadband, wireless, and – with DirecTV’s 20M subs – satellite video will make it “a national force.” DirecTV’s NFL Sunday Ticket also is important; AT&T can walk away from the deal if the satellite company doesn’t renew its licensing Read More »

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Consumers Dislike Cable Companies More Than Any Other Industry: Report

American Customer Satisfaction IndexIt’s time for the pay TV industry’s annual slap in the face from the American Customer Satisfaction Index, which surveys 70,000 people about the products and services they use most. Cable and satellite distributors always fare badly in these polls — but this year’s results are especially disturbing after a slight uptick last year. The companies’ pay TV services collectively scored 65 out of 100, down 4.4% from last year, making subscription TV the second-least liked of the 43 industries ACSI tracks. What’s worse? Internet service providers, with a score of 63, down 3.1% — and which mostly consists of the same companies. People ”question the value proposition as both, as consumers pay for more than they need in terms of subscription TV and get less than they want in terms of Internet speeds and reliability,” ACSI Chairman Claes Fornell says.

Related: Can Comcast Be Trusted? Company Report Says It Exceeded Promises In NBCU Deal

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Consumers Group, Public Interest Org Respond To AT&T-DirecTV Deal

By | Sunday May 18, 2014 @ 4:01pm PDT

AT&TdirecTV__130523212608Following Sunday’s unanimous board approval of AT&T‘s $48.5 billion deal to buy satcaster DirecTV, DC-based public interest group Public Knowledge and Consumers Union, the public policy and advocacy division of Consumer Reports, called for extensive analysis of the pact which is still subject to approval by DIRECTV shareholders and to review by the FCC, U.S. Department of Justice, some U.S. states and Latin American countries. The deal is expected to be made final within 12 months.

Related: AT&T Seals $48B+ Deal To Acquire DirecTV

Said Public Knowledge’s Senior Staff Attorney John Bergmayer:

“The industry needs more competition, not more mergers. The burden is on AT&T and DirecTV to show otherwise. We’ll have to analyze this carefully for potential harms both to the video programming and the wireless markets. The most obvious concern is that customers in U-Verse territories would lose a video competitor, though the transaction would have nationwide effects.

“Public Knowledge tends to view mergers with a skeptical eye. In this case, it will help to hear more definitive information about the companies’ plans. For example, does AT&T plan to frame this as allowing it to compete more effectively with Comcast? If so, that is yet another reason why policymakers should be skeptical of the pending Comcast/Time Warner Cable transaction. We also need to know more about whether AT&T plans to offer some kind of wireless/pay TV bundle, and what kinds of services it could offer in both U-Verse territories and nationwide. Policymakers will have to ask a lot of tough questions when looking at this deal.

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AT&T Seals $48B+ Deal To Acquire DirecTV

By | Sunday May 18, 2014 @ 2:37pm PDT

AT&TAT&T has finalized its deal to acquire DirecTV, the nation’s No. 1 satellite TV provider, for $94 per share. The boards of the respective companies reportedly came to terms of the $48.5 billion stock and cash deal over the weekend in a major tie-up creates a pay-TV powerhouse that would have a similar scale and in some ways act as a response to Comcast’s proposed $45B merger with with Time Warner Cable and is just the latest major proposed consolidation in the TV and telecom industries.

Related:
Are DirecTV And AT&T Becoming Serious About Making A Deal?
DirecTV Shares Up On Report That A Deal With AT&T Is Near

direcTV__130523212608AT&T has an existing partnership with the satellite giant to sell its service in areas where it offers broadband but doesn’t offer its U-verse TV service, which has 5.7M subscribers. DirecTV has about 20M subs. The broadband expansion will cover 70M customer locations. Under the terms of the deal DirecTV’s operations will continue to be based in El Segundo, CA.

Deal will also allow AT&T to boost broadband speeds and expand its high speed broadband service to 15M customer locations including rural areas not currently wired, to be completed within four years. DirecTV customers can retain their standalone service packages for three years.

DirecTV stock has been hovering around record highs the past week amid rising rumors that … Read More »

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DirecTV CEO: Content Companies May Cripple Planned Online Video Services

By | Thursday May 15, 2014 @ 7:28am PDT

Michael WhiteThere’s an Achilles Heel for the upcoming so-called over-the-top online pay TV services — including a low priced, entry level one Dish Network plans with help from Disney — DirecTV chief Michael White told an investor audience this morning. “If you make it too good you’re going to cannibalize the [conventional pay TV] business,” he said at the first MoffettNathanson Media & Communications Summit. ”It’s in the content companies’ interest to not make it too good.” It’s a problem because Big Media companies still control TV programming. direcTV__130523212608If an online provider could offer “AMC and FX, and not have to pay for Nickelodeon and all the other stuff [then] you might get there,” White says. “My bet is that everyone including Disney will try to bundle more stuff” in an online service, driving up the price. ”It’s a slippery slope…Can you unbundle good enough stuff?” DirecTV research shows a “sharp fall off” of consumer interest in a video service once the price exceeds $12 a month.
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DirecTV Shares Up On Report That A Deal With AT&T Is Near

By | Monday May 12, 2014 @ 2:39pm PDT

direcTV__130523212608The No. 1 satellite company is +6.3% in post market trading after the Wall Street Journal reported that DirecTV and AT&T are “moving quickly” and could make an announcement within two weeks. The paper says AT&T may offer cash and stock that values DirecTV at $50B, a 12.4% premium over its $44.5B market value based on today’s closing price. If DirecTV’s after hours trading price of about $92.65 a share holds, then it would set a new record high for the stock, which is up 13.8% since the end of April when reports of the talks with AT&T surfaced. Last week DirecTV CEO Michael White sought to besmirch the accurate reports about the talks with AT&T as little more than “media rumors and speculation.” He added that the reports “are not based on official sources of information” but did not contradict them.

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Are DirecTV And AT&T Becoming Serious About Making A Deal?

By | Wednesday May 7, 2014 @ 3:51pm PDT

direcTV__130523212608Seems so: The satellite company has hired Goldman Sachs to help evaluate a possible combination The Wall Street Journal reported today — contributing to a late afternoon spike in DirecTV‘s shares. The company closed +8% to $81.35 and touched $88.55, an all time high. Yesterday DirecTV CEO Michael White tried to besmirch apparently accurate and newsworthy reports about AT&T‘s approach as mere “media rumors and speculation.” He added that he doesn’t “view it as productive to speculate about alternative business combinations, which may or may not occur.” But he also chose not to tell investors the facts. Brean Capital’s Todd Mitchell says a combination would give AT&T — which has 5.7M video customers on its U-verse platform — “much needed scale in a post Comcast-[Time Warner Cable] world.” But Guggenheim Securities’ Michael Morris says that consolidation is “unlikely in the current environment” because competition “appears to be limiting pricing growth to consumers, likely a positive from a regulatory perspective.”

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DirecTV CEO Says He’s Seen “Immaterial” Sub Loss Without Dodgers Channel

By | Tuesday May 6, 2014 @ 12:10pm PDT

Doesn’t sound like DirecTV customers will see Los Angeles Dodgers games on Time Warner Cable‘s SportsNet LA any time soon. Dodgers SportsNetThe No. 2 cable company’s $8.35B, 25-year commitment for distribution rights was “an unprecedented deal above any rational view of the market” — especially considering baseball’s six-month season — DirecTV CEO Michael White told analysts in a conference call. “We’d still like to carry the Dodgers. We’re still having discussions with Time Warner Cable about it.” But he chafes at the price TWC wants, reportedly $4 per month direcTV__130523212608for each subscriber who receives the channel. “It’s a tax on most customers who wouldn’t pay it if they had a choice.” Last month TWC’s Rob Marcus said that the cable company is adding subs from Dodgers fans who can’t see SportsNet LA on any other pay TV service (except for closely allied Bright House). But White says DirecTV’s churn in LA has been “immaterial ….We’ll continue discussions and hope we can get to a sensible place.” The prices TWC still wants are “so far are beyond what a rational view of the market is.”

Related: LA Mayor Makes Plea For Resolution To Dodgers TV Dispute

White began the call declining to discuss the subject that most interests investors: stories in The Wall Street Journal and elsewhere reporting that he’s been approached by AT&T about a possible deal valued at $40B. “These reports are not based on official sources of information,” he said — a comment that falls far short of an outright denial. Read More »

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Does AT&T Really Want DirecTV Instead Of Dish Network?

By | Thursday May 1, 2014 @ 10:09am PDT

PdirecTV__130523212608ossibly, but the smart money today is betting that AT&T would prefer Dish. DirecTV shares are up 5.5% in mid-day trading following a Wall Street Journal report that the telco giant initiated conversations about a deal that could be worth $40B. But Dish Network is up even more at 7.5%. “We scratch our heads” at AT&T’s motivation to team with DirecTV because the satellite company “does not have wireless spectrum,” Wells Fargo Securities’ Marci Ryvicker says. She suspects the approach to DirecTV is a way “to perhaps ‘flesh out’ [Dish Chairman Charlie Ergen] to pursue some sort of transaction with Dish.” Guggenheim Partners’ Paul Gallant also says that AT&T would prefer Dish, which has been amassing rights to spectrum in the hope of creating a wireless broadband business. AT&TThat could be important for AT&T because “it is not immediately obvious where new spectrum comes from after the FCC’s broadcast spectrum auction in 2015.”

Wunderlich Securities’ Matthew Harrigan believes an AT&T-DirecTV combo makes sense. AT&T’s U-verse has just 5.7M video customers. Teaming with DirecTV, with 20.1M U.S. subs, would “offer a premium demographic national video solution that supports first to market 4K TV capabilities while allowing AT&T’s U-verse plant to be entirely dedicated to broadband.” (Its systems now allocate 15 Mbps to video and 10 Mbps to Internet.) Read More »

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The Weather Channel Returns To DirecTV

By | Tuesday April 8, 2014 @ 11:41am PDT

Weather Channel DirecTVThe companies aren’t disclosing financial terms, but DirecTV appears to have won some major concessions, including an apology. The Weather Channel (to appear on channel 362) will cut its reality programming by half on weekdays. It also will return instant local weather and authorize DirecTV subscribers to stream its video programming to multiple devices inside and outside the home. And, in a really unusual twist, TWC chief David Kenny apologized to “DirecTV and their customers for the disruption of our service and for initiating direcTV__130523212608a public campaign. Our viewers deserve better than a public dispute, and we pledge to reward their loyalty with exceptional programming and more weather focused news.” DirecTV Chief Content Officer Dan York crowed that while the dispute was “frustrating for many of our customers … their patience was ultimately rewarded with a better deal and a better product.”

Related: TWC Pushing Public Safety Image After DirecTV Blackout

DirecTV dropped TWC on January 14. The channel wanted a penny increase in the price DirecTV pays for it. (It averages 13 cents per subscriber per month across pay TV systems, according to SNL Kagan data.) But DirecTV said it wanted to cut its outlays, noting that TWC too often offers reality programs such as Deadliest Space Weather and Coast Guard Alaska instead of the latest local weather. Last week DirecTV strengthened its bargaining position by reaching a multi-year agreement to offer WeatherNation (on channel 361).

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