AT&T-DirecTV Deal Further Complicates Job of Regulators

The AT&T-Dish transaction doesn't appear to pose a serious threat to competition outside of markets where AT&T already offers pay-TV service. But it comes amid a spate of telecom megamergers, including Comcast’s proposed acquisition of Time Warner Cable, making it hard for regulators to gauge the potential impact of both the Comcast and AT&T deals.

Both the Justice Department and Federal Communications Commission must sign off on the DirecTV deal, with the former concerned about competition and the FCC charged with a broader mandate to protect the public interest. The deal's primary selling point is that the combined company would be in a position to compete with Comcast and other cable companies in the lucrative pay-TV and broadband markets. Should regulators approve the Comcast-Time Warner Cable merger, the combined AT&T-DirecTV would be in a position to compete nationally with the new cable giant for subscribers and the most-popular video content. The merger is unlikely to face insurmountable antitrust hurdles because the two companies aren't major head-to-head competitors and already have joined forces to sell DirecTV in areas where AT&T doesn't offer its U-verse pay-television service, antitrust experts said.