AT&T chief financial officer John Stephens answered a question that has been on many investors’ minds in the past few days – why didn’t the phone giant make a play for Dish Network – at an industry conference Wednesday, telling the audience that regulators would have had difficulty approving such a deal.
AT&T announced Sunday its agreement to acquire satellite giant DirecTV in a deal valued at about $67 billion. While the two have pointed to numerous reasons to do the deal – including about $1.6 billion in annual operating synergies after the third year – some have wondered why the phone giant didn’t make a play for Dish Network first. Dish, which has about 14 million satellite TV customers compared to DirecTV’s 20 million, owns about 50 Megahertz of wireless spectrum which would appear to be attractive to AT&T’s own wireless operations.
At the J.P. Morgan Global Technology, Media and Telecom Conference in Boston Wednesday, Stephens said while DirecTV’s was still the carrier’s first choice, Dish’s spectrum would have made it more difficult to obtain regulatory approval.
“Dish has been very loud about their intentions to get into broadband,” Stephens said. “From a regulatory perspective, bringing a company that either is or intends to be in broadband with another broadband company would be likely to raise additional regulatory scrutiny.”