Spinning Off DirecTV Will Let It Focus Better on Video: AT&T

AT&T's DirecTV and U-verse are challenged by the rise of online video distribution and the decline of MVPDs, and a New DirecTV spinoff with more autonomy will be in a better position to improve technology, optimize marketing and fortify "the overall value proposition for ... customers," said AT&T in an FCC International Bureau application Monday. It seeks approval of transfer of control of a variety of its satellite, earth station and private land mobile radio licenses as part of the planned $7.8 billion spinoff of its video distribution business (see 2102240046). It said the deal will give New DirecTV the dedicated management focus needed to deal with changing consumer preferences and investment capital aimed solely at improved tech and marketing. AT&T TV "will be rolled out more broadly and marketed more consistently and evenly," it said. It said the deal raises no horizontal or vertical competitive concerns, as investment firm TPG, which will have a minority stake in New DirecTV, is under contract to relinquish control of its only pay-TV business interest -- Astound, a cable overbuilder with video subscribers in 10 states and Washington, D.C.