Inc. has many strong rivals in the great convergence of
wireless, Internet and video technologies, but none
looms larger ó potentially ó than search giant
the impression from a close reading of a recent
regulatory filing supporting Dallas-based AT&Tís
acquisition of California-based DirecTV.
and again over nearly 350 pages of executive
declarations and transaction summaries, attention
focuses on the potential competitive threat of Google.
Fiber is "the most ambitious and potentially
disruptive" broadband provider, the filing states.
and Google are racing to provide ultra-high speed fiber
connections to homes in selected areas of the country.
Speed is important as the tech convergence makes video,
in all of its forms, available anytime, anywhere, on any
her declaration, AT&T senior executive vice
president Lori Lee said Googleís deployment of fiber
in Kansas City has been "very successful." She
said AT&T has lost customers in Google areas since
the search company launched its service there last year.
telling because the filing states elsewhere that, since
2011, "cable operators combined lost share" to
AT&Tís bundled U-verse Internet and television
services in areas where U-verse video is available.
is the fastest growing part of AT&Tís business.
of AT&Tís specific loss in Kansas City were among
more than 280 redactions of "highly confidential
information" in the public filing, available on the
Federal Communications Commissionís website.
filing also cites experts who predict that Google could
capture at least half of the households in its Kansas
City "fiberhoods" in three to four years. And
it points out that 24 of the 34 cities that Google has
targeted for expansion are within AT&Tís
section refers to the potential size of Google Fiberís
national network. While the specific numbers from a
third-party researcher are redacted in the filing, they
are readily available in online media coverage of the
could profitably build a network passing 20 or 30
million U.S. homes and business in the next several
years, the report said.
has said that it plans to launch its super-fast U-verse
with GigaPower service in Dallas this summer.
May 18, AT&T and DirecTV announced their deal,
valued at $67 billion including debt. On June 11, late
in the workday, the companies made their filing to the
FCC and then sent an executive summary to reporters, who
had little time on deadline to review the complete
full filing largely re-iterates many of the points made
by AT&T CEO Randall Stephenson and other executives
at the time of the announcement: The deal is
pro-consumer and will redefine the video entertainment
industry, in part by making bundled packages of Internet
and video services available to more customers at home
and on the move.
far from great literature, a full reading of the filing
does bring to mind the opening lines of "A Tale of
Two Cities," the classic novel by English writer
was the best of times, it was the worst of times"
Ö even now for two companies with combined annual
revenue of about $170 billion.
saying theirs is a marriage of two leaders of their
respective industries, telecom and satellite TV,
AT&T and DirecTV continually stress that the intense
business challenges of today necessitate their merger.
filing goes into detail about what AT&T calls a lack
of scale in its U-verse video offering, which currently
has about 5.7 million subscribers. The service "is
uneconomic and not fully competitive with cable
providers," the filing states.
costs, which are steadily rising and "consume 60
percent of AT&Tís subscriber video revenues,"
are largely the culprit.
the added scale of 20 million or so DirecTV subscribers,
AT&T expects to reduce its per-subscriber content
20 percent for AT&Tís stand-alone video business.
Other specifics are redacted.
has said the regulatory review process will take about a
year and he is confident the deal will be approved.