Fri, May 8, 11:37 AM
- A suit that might have slowed down progress on the review of AT&T's (NYSE:T) purchase of DirecTV (NASDAQ:DTV) has wrapped, with the court throwing out the FCC's order for media companies to disclose their pay-TV programming contracts.
- The agency had asked for the disclosures in connection with their reviews of that deal and of Comcast's now-failed bid for Time Warner Cable, but major content companies including CBS, Walt Disney (NYSE:DIS), Fox (NASDAQ:FOXA) and Viacom (VIA, VIAB) argued the results would cause "irreparable harm" to their negotiating strategies.
- The FCC's order was found "substantially and procedurally flawed." The resolution removes yet another hurdle between AT&T and DirecTV.
- Previously: With Comcast-TWC done, federal suit likely focuses on AT&T-DirecTV (Apr. 24 2015)
Tue, May 5, 11:47 PM
- Cogent Communications (NASDAQ:CCOI) joined Netflix today in calling for conditions on the proposed merger of AT&T (NYSE:T) and DirecTV (NASDAQ:DTV).
- Data carriers like Cogent (along with firms like Netflix) are focused on interchange issues, the fees that a broadband behemoth could collect for accepting Internet traffic -- and their opposition, or the nature of it, could be good news for the deal, says industry analyst Craig Moffett.
- The reason? The companies could be kingmakers by urging concessions, he says: They helped sink the Comcast-TWC deal, and now with AT&T/DirecTV, “two of the most ardent opponents are tacitly blessing the idea of the merger as long as there are appropriate conditions.”
- The two say that a combined AT&T/DirecTV with no restrictions will have a bigger incentive to stymie streaming entertainment.
Tue, May 5, 9:13 PM
- DirecTV (NASDAQ:DTV) -- down 1.7% today following this morning's earnings miss -- did have the benefit of adding 279K net new subscribers, including 60K in the U.S., running counter to old-line cablecos facing video subscriber losses.
- The problem, the WSJ notes, is that those other companies like Comcast and Charter made up for it with broadband service -- and DirecTV doesn't offer that. And when the video numbers turn, DTV will start to suffer, especially if anything gets in the way of its tie-up with AT&T (NYSE:T).
- During the earnings call today, CEO Michael White said the company has about 1M subs on its "skinny bundle" -- a $19.99/month package that goes up to $49.99 after a 24-month contract. The company introduced that package after Dish Network launched its $20/month Sling TV.
- White says he'd think about skinny differently with a broadband component and notes DirecTV could technically offer over-the-top service through its set-top, and already does something like it with a Pandora app.
- Previously: Netflix to FCC: Reject AT&T/DirecTV merger (May. 05 2015)
Tue, May 5, 12:29 PM
- DirecTV (NASDAQ:DTV) is off 0.7% now after Q1 earnings missed on top and bottom lines amid weakness in the company's Latin American business weighed down by forex issues.
- Adjusted net income fell to $730M. EBITDA of $2.11&B missed an expecteed $2.136B.
- Overall the company added 279K net new subscribers. DirecTV U.S. added net 60K new subscribers and reported churn of 1.37% -- down from a year-ago 1.45% and its lowest Q1 rate in six years.
- Latin America showed net 219K new subscribers, down from year-ago 361K; churn there grew to 2.15% from 1.85%. Currency headwinds caused ARPU to decline 18.8% to $46.80 at the Sky Brasil unit, and decline 1.8% to $40.47 at the PanAmericana and Other segment.
- Free cash flow rose 5% to $927M, mainly due to lower tax payments and lower net interest payments.
- Conference call at 2 p.m. ET.
- Press Release
- Previously: Netflix to FCC: Reject AT&T/DirecTV merger (May. 05 2015)
Tue, May 5, 11:04 AM
- Netflix (NASDAQ:NFLX) is pressing the FCC to reject the $48B merger of AT&T (NYSE:T) and DirecTV (NASDAQ:DTV), according to regulatory filings revealed today, on complaints about market power -- as the merger could "lead to its becoming the largest (Internet service provider) in the country as well" as becoming the biggest MVPD.
- The remarks came as Netflix officials met with more than 20 FCC staff last week.
- "Such market power creates new incentives and abilities to harm entities that AT&T perceives as competitive threats," Netflix reps said, "and will exacerbate the anticompetitive behavior in which AT&T has already engaged."
- Netflix shares are up 3.8% today in the wake of BofA/Merrill Lynch's heavy upgrade; AT&T is down 1.2% and DirecTV is down 0.5%.
Tue, May 5, 7:33 AM
Mon, May 4, 5:30 PM
- ABMD, ACTA, AFSI, ALLT, AMAG, ANIP, BBEP, BBW, BLMN, BPI, CIE, CLDT, CRTO, CVLT, CYNO, DIS, DISCA, DTV, EIGI, EL, EMR, ENR, EXH, EXLP, GCAP, GLDD, GLT, GTN, GVA, H, HCA, HCP, HEP, HRC, HRS, HW, ICE, ISIS, K, KEM, KLIC, KMT, LPX, MDC, MDCO, MMP, MNK, MSO, NBL, NGLS, NNN, [[NTi]], NWN, ODP, OZM, PRIM, SABR, SALE, SBH, SCOR, SGNT, SMG, SNSS, SPAR, SRE, SSE, STWD, TDG, TECH, TGH, TRW, TW, UAM, USAK, VLP, VMC, VSH, WEC, WNR, YORW, ZTS
Fri, Apr. 24, 7:30 PM
- Comcast has ended its pursuit of Time Warner Cable, but what about that lawsuit from content companies that threatened to slow the whole thing down?
- Companies including CBS, Walt Disney (NYSE:DIS) and Viacom (VIA, VIAB) argued that the FCC's sharing hundreds of thousands of pages of negotiating strategies with third-party merger opponents like Dish Network (NASDAQ:DISH) would be "highly damaging." The fight was likely to add several weeks to any related merger consideration.
- The suit, still at the U.S. Court of Appeals, is still in progress because it also involved the ongoing AT&T (NYSE:T) deal to acquire DirecTV (NASDAQ:DTV). Attorneys close to the case are figuring that the Comcast-TWC documents will now be off the table as a moot point.
- Still, the decision likely still has an impact on the timeline for AT&T/DirecTV. The FCC will file an updated notification with the court.
- Previously: AT&T sells third-biggest debt offering to fund DirecTV purchase (Apr. 23 2015)
- Previously: Comcast, TWC move higher premarket on merger's end (Apr. 24 2015)
- Previously: It's over: Comcast officially ends $45B pursuit of TWC (Apr. 24 2015)
Thu, Apr. 23, 6:24 PM
- AT&T (T +4.2%) peddled $17.5B in bonds in the third-biggest debt offering on record, as it draws funds to help pay for its acquisition of DirecTV (NASDAQ:DTV) -- a media deal that looks to be a survivor as other mergers fall apart.
- The sale's part of a record year in debt sales; it's the third-biggest ever but only the second-largest this year, as Actavis sold $21B in March.
- Yield-hungry investors put in $68B in orders, nearly four times the offer. A 10-year bond was priced to yield 3.435%; a 31-year bond at 4.772%.
- The company may be getting ahead of the rush. More debt deals are likely to come ahead of any move by the Fed to raise rates, and they're likely to find investors so long as there are negative yields still in the market.
- AT&T will redeem some bonds at a premium if the DTV deal's not done by Nov. 30, though it still exepcts a Q2 closing.
- Previously: AT&T call: On reducing churn, and post-acquisition deleveraging (Apr. 22 2015)
Tue, Apr. 21, 7:17 PM
- FCC officials tomorrow will brief staff about the proposed $45B merger of Comcast (NASDAQ:CMCSA) and Time Warner Cable (NYSE:TWC), Reuters is reporting -- though with no news about which way officials are thinking.
- The briefing may be light on specifics but might offer some clues to how the FCC will deal with recent public opposition to the buyout. The FCC's ruling on the deal will focus on public interest, while the Department of Justice focuses on antitrust concerns.
- The staff will also be briefed tomorrow on AT&T's (NYSE:T) $48B deal to buy DirecTV (NASDAQ:DTV), according to Reuters.
- Previously: WSJ: Comcast, Time Warner Cable to meet with Justice Dept. (Apr. 18 2015)
- Previously: Comcast defends TWC deal, announces 2-Gbps California plan (Apr. 17 2015)
Tue, Apr. 14, 7:17 PM
- With the FCC's new net neutrality rules published in the Federal Register, AT&T (NYSE:T) and three industry trade groups representing cablecos and wireless carriers have filed separate lawsuits challenging the rules, which subject firms to heavier "telecom services" regulations.
- AT&T is the first large individual challenger, joined by the National Cable and Telecommunications Association, wireless group CTIA and the smaller American Cable Association. The NCTA has hired former solicitor General Ted Olson, who argued Bush v. Gore before the Supreme Court.
- Publication in the Federal Register means the rules take effect 60 days from yesterday -- which is why affected companies had their briefs warmed up.
- Represented/related companies: VZ, TMUS, S, CMCSA, CHTR, TWC, CVC, CTL, FTR, CCOI, DISH, DTV
Thu, Apr. 9, 9:08 PM
- Don't let recent merger challenges and failures fool you, Michael Wolff argues: "M&A mania" is coming to a media conglomerate near you amid pressure for a new wave of consolidation.
- "Perhaps never before has consolidation been so much the flavor of the month, nor has it seemed so difficult to get a taste," he writes. "The table is set, but nobody's sitting down to eat."
- If Comcast (NASDAQ:CMCSA) fails in its bid for Time Warner Cable (NYSE:TWC), he notes, it just means other cablers will step up to match Comcast's ambition, and Comcast will still look for a way to stay dominant.
- He points to a number of mergers he thinks are easily imaginable: Viacom (NASDAQ:VIA) and FOX? Disney (NYSE:DIS) and Time Warner (NYSE:TWX)? TWC and Charter (NASDAQ:CHTR)? Discovery (NASDAQ:DISCA) and, well, most anyone (Disney, Fox, CBS)?
- Factors encouraging the wave: Media's all about video now, and the pure-play aspect makes merger logic cleaner; distribution and content are separate and now even antagonistic businesses; the growth of over-the-top means not unbundling but re-bundling; and everyone needs scale for negotiation strength in content and ad deals.
- Other key players: John Malone (LMCA, LBTYA, STRZA); Verizon (NYSE:VZ); Lions Gate (NYSE:LGF); Scripps Networks (NYSE:SNI); Netflix (NASDAQ:NFLX); DirecTV (NASDAQ:DTV) and AT&T (NYSE:T); Dish Network (NASDAQ:DISH).
Tue, Apr. 7, 6:41 PM
- An ad trade group has told DirecTV (NASDAQ:DTV) to discontinue its well-known "Rob Lowe alter-ego" ads after Comcast complained about the accuracy of claims the characters were making about DirecTV service in comparison with cable
- The ads -- which portray the actor as a successful DirecTV subscriber and his less attractive/creepy alter egos that are cable subscribers -- include claims of better signal reliability, better picture and sound quality and shorter customer service wait times.
- The Council of Better Business Bureau’s National Advertising Division couldn't substantiate many of the claims and instructed DirecTV to drop them. DirecTV will appeal the decision, but in the end the claim could be referred to government regulators.
Tue, Apr. 7, 11:49 AM
- As expected, AT&T's (NYSE:T) $49B purchase of DirecTV (NASDAQ:DTV) is headed for an easier approval than Comcast's takeover of Time Warner Cable -- and the AT&T deal may wrap before April is through, with a few "action packed" weeks ahead, says Morgan Stanley's Simon Flannery.
- Flannery sees limited opposition to the deal, though he does warn about risks including AT&T's leverage in the deal and its recent $18B purchase of wireless spectrum.
- But the purchase may have taken too long -- way too long in coming, says analyst Craig Moffett, since the deal is "oh so 2005."
- "There was a certain logic to it at the time," Moffett says, pointing out that buying a satellite distribution arm would have been better 10 years ago, when Verizon was building a future-proof fiber network and AT&T's network limitations were clear even then.
- "Don't get us wrong. DirecTV is a well-run asset," Moffett writes, "with a sterling brand and strong management, and the company's free cash flow will clearly help sustain AT&T's dividend. But it is hard to make the case for genuine strategic fit between the two companies."
- Previously: With regulator eyes on Comcast-TWC, is AT&T's DirecTV purchase skating? (Mar. 17 2015)
Mon, Apr. 6, 5:34 PM
- Another rite of spring arrives with baseball's Opening Day, and the L.A. Dodgers (who've made the playoffs each of the past two years and are favored again this year) are still off the air for most Southern California residents amid a Time Warner Cable (NYSE:TWC) dispute.
- TWC paid the dodgers $8B to launch SportsNet LA, but hasn't reached agreement with any other provider to carry the channel, meaning 70% of locals are shut out of coverage unless they watch at the park in person.
- In particular, DirecTV (NASDAQ:DTV) is refusing to pay $4 per subscriber-month to air the games and there may be little progress toward a carriage deal until merger plans for TWC (with Comcast) and DirecTV (with AT&T) get resolved.
- Sources tell the Los Angeles Times that TWC is losing $100M on its channel in the standoff.
Tue, Mar. 24, 3:54 PM
- Buyback-happy U.S. firms are prohibited from repurchasing shares from about five weeks prior to releasing quarterly earnings to about 48 hours after those reports. These blackout periods, says Goldman, may offer an especially tasty time for investors to pick up shares of their favorites.
- "High valuations in the absence of corporate demand may weigh on stock prices," says Goldman's Amanda Sneider, and particular areas of focus are tech, consumer discretionary, and financials - they've accounted for more than 50% of buyback activity.
- Goldman's buyback blackout theme buys: SanDisk (NASDAQ:SNDK), Yahoo (NASDAQ:YHOO), Travelers (NYSE:TRV), Apple (NASDAQ:AAPL), Juniper Networks (NYSE:JNPR), Xerox (NYSE:XRX), Torchmark (NYSE:TMK), F5 Networks (NASDAQ:FFIV), Citrix Systems (NASDAQ:CTXS), Aon (NYSE:AON), Moody's (NYSE:MCO), VeriSign (NASDAQ:VRSN), Hartford Financial (NYSE:HIG), Ameriprise (NYSE:AMP), Corning (NYSE:GLW), Time Warner (NYSE:TWX), Seagate Technology (NASDAQ:STX), Viacom (NASDAQ:VIAB), Legg Mason (NYSE:LM), XL Group (NYSE:XL), DirecTV (NASDAQ:DTV), Allstate (NYSE:ALL), Nvidia (NASDAQ:NVDA), CBS (NYSE:CBS), Macy's (NYSE:M), Kohl's (NYSE:KSS).
Other News & PR