Top executives at AT&T and DirecTV want the Federal Communications Commission (FCC) to “rethink possible” when it comes to M&A, spending June 26 by speaking with FCC commissioners pitching the proposed merger between the two companies.
Public filings reveal that representatives from the two companies met individually with four of the five FCC commissioners and their staffs, hoping to convince them to accept the proposed $49 billion merger. In a filing, AT&T Chief Privacy Officer Robert W. Quinn wrote that the company executives “stressed the public benefits that the proposed combination would bring to the market.”
AT&T and DirecTV argued that their services are complementary rather than in competition. DirecTV noted that the company is currently “disadvantaged in competing for customers” since it cannot offer bundles including Internet service, similar to competitors such as Comcast or Verizon. AT&T, meanwhile, said that its TV service is limited compared to competitors.
“By achieving the anticipated merger synergies and by enabling an effective bundle of broadband/video services in more areas, the combined company will fill the gaps in each company’s respective service portfolios,” Quinn wrote in the filing.
The FCC must determine whether the proposed merger would produce adverse effects for consumers. According to The Hill, lawmakers seemed largely welcoming to the proposed merger after speaking with company executives. This stands in stark contrast to the proposed Comcast/Time Warner acquisition, which was met with pushback from both Capitol Hill as well as state agencies.
Representative Hank Johnson said that in the proposed AT&T/DirecTV deal, “the bulk of the evidence demonstrates that each company primarily serves different markets with different services.” He further added in response to competition concerns, “Although the proposed merger represents a concerning trend towards industry consolidation, there is ample evidence that this transaction would create considerable public-interest benefits.”