AT&T promised a TV revolution — instead, we got a giant mess

AT&T announced it would be spinning off its TV business — including DirecTV, AT&T TV, and U-verse — in a deal it claimed would greatly benefit the company’s customers, employees, and shareholders. The deal provides AT&T with a $7.8 billion cash infusion to pay down debt and recent wireless spectrum purchases, and a 70 percent stake in the “new” DirecTV. But it also values the entire operation at around $16.25 billion, a massive loss from the $67 billion AT&T paid just a few years earlier for just DirecTV alone. It’s the latest chapter in AT&T’s long journey to transform from a boring old telecommunication company into a dominant player in new media. Six years, 54,858 layoffs, two mergers, and nearly $175 billion later, AT&T is only marginally closer to streaming TV dominance. Instead, customers and employees are footing the bill for their bad decisions in the form of TV rate hikes and layoffs that show no sign of slowing down. Wall Street telecom analyst Craig Moffett surveyed the wreckage in a research note to investors, in which he noted the deal does little to tackle $157 billion in remaining AT&T debt. “AT&T’s DirecTV is inarguably one of the worst acquisitions of all time,” Moffett said. “They bought it for $67 billion in 2013. Even at the overly-generous valuation reported last night, they are exiting at a price 76% below what they paid for it just seven years ago.”