Rumor Revived: Will Verizon Buy A Sat TV Company? - Tech Trader Daily - Barrons.com
On a slow news day, the Wall Street Journal has dusted off the old telco-buys-sat TV company rumors.
In a Heard on the Street piece, the Journal says that the odds of Verizon (VZ) buying DirecTV (DTV) could be shortening.
The theory is based on Verizon CEO Ivan Seidenberg’s recent remark that he wants to make video the company’s core product for its fixed-line business; the story asserts that the best way to do that would be to buy a satellite TV company - and that the best one to buy would be DTV.
The story notes that the modest success Verizon has had to date with its FiOS video service - 2.5 million TV customers to date - still leaves the company only the #8 player in pay TV, an order of magnitude behind Comcast with 23.9 million subs.
If the company bought DTV, it would instantly be the second-largest pay TV player. The WSJ notes that the company could alternatively buy Dish Network (DISH), but that DTV is bigger and better performing; the piece also notes that AT&T (T) has been widely expected previously to be the most likely buyer for Dish.
One thing not calculated into the mix in the Journal story is the fact that AT&T about a year ago decided to stop reselling DISH service to its customers, offering them only DirecTV service in areas where they haven’t yet rolled out their U-verse TV service. Were Verizon to buy DTV, it is possible that AT&T would then turn around and partner with DISH - or buy it - and leave DTV in the lurch.
DTV today is up 21 cents, or 0.8%, to $26.81. DISH is up 73 cents, or 4%, to $18.82.
On a slow news day, the Wall Street Journal has dusted off the old telco-buys-sat TV company rumors.
In a Heard on the Street piece, the Journal says that the odds of Verizon (VZ) buying DirecTV (DTV) could be shortening.
The theory is based on Verizon CEO Ivan Seidenberg’s recent remark that he wants to make video the company’s core product for its fixed-line business; the story asserts that the best way to do that would be to buy a satellite TV company - and that the best one to buy would be DTV.
The story notes that the modest success Verizon has had to date with its FiOS video service - 2.5 million TV customers to date - still leaves the company only the #8 player in pay TV, an order of magnitude behind Comcast with 23.9 million subs.
If the company bought DTV, it would instantly be the second-largest pay TV player. The WSJ notes that the company could alternatively buy Dish Network (DISH), but that DTV is bigger and better performing; the piece also notes that AT&T (T) has been widely expected previously to be the most likely buyer for Dish.
One thing not calculated into the mix in the Journal story is the fact that AT&T about a year ago decided to stop reselling DISH service to its customers, offering them only DirecTV service in areas where they haven’t yet rolled out their U-verse TV service. Were Verizon to buy DTV, it is possible that AT&T would then turn around and partner with DISH - or buy it - and leave DTV in the lurch.
DTV today is up 21 cents, or 0.8%, to $26.81. DISH is up 73 cents, or 4%, to $18.82.
