FCC Grants Approval Of AT&T-DIRECTV Transaction

Media Contact:

Kim Hart, (202) 418-8191

Kim.hart@fcc.gov

For Immediate Release

FCC GRANTS APPROVAL OF AT&T-DIRECTV TRANSACTION

WASHINGTON, July 24, 2015 - Today, the Federal Communications Commission grants - with

conditions - approval of the transfer of control of licenses and authorizations from DIRECTV to

AT&T Inc. (AT&T). The approval will allow AT&T to acquire DIRECTV and merge the two

companies into one combined entity. An Order detailing the Commission's reasoning and the

conditions will be issued shortly.

The Commission's decision is based on a careful, thorough review of the record, which includes

extensive economic analysis and documentary data from the applicants, as well as comments

from interested parties. Based on this review, the Commission has determined that granting the

application, subject to certain conditions, is in the public interest.

As part of the merger, AT&T-DIRECTV will be required to expand its deployment of high-

speed, fiber optic broadband Internet access service to 12.5 million customer locations as well as

to E-rate eligible schools and libraries. In addition, AT&T-DIRECTV is prohibited from using

discriminatory practices to disadvantage online video distribution services and will submit its

Internet interconnection agreements for Commission review. Finally, AT&T-DIRECTV will

offer broadband services to low-income consumers at discounted rates.

The conditions imposed by the Commission address potential harms presented by the

combination of AT&T, one of the nation's largest telephone and Internet service providers, and

DIRECTV, the nation's largest satellite video provider. The conditions also ensure that the

benefits of the merger will be realized. These targeted conditions, which generally will remain in

effect for four years after the merger closes, include:

Fiber to the Premises (FTTP) Deployment. Recognizing that the merger reduces

AT&T-DIRECTV's incentive to deploy FTTP service, the Commission adopts as a

condition of this merger the expansion of FTTP service to 12.5 million customer

locations. This condition also responds to the harm of the loss of a video competitor

in areas where AT&T and DIRECTV had directly competed before the merger by

providing a pathway for increased competition from services that rely on broadband

Internet to deliver video.

Gigabit Service to E-rate Eligible Schools and Libraries. In addition, to ensure that

schools and libraries also benefit from expanded fiber deployment to consumers and

institutions, the Commission is also requiring AT&T-DIRECTV to offer gigabit

service to any E-rate eligible school or library where AT&T-DIRECTV deploys

FTTP service.

Non-Discriminatory Usage-Based Practices. Recognizing that AT&T is the only

major ISP that applies data caps across the board to all of its fixed broadband

customers and that this merger increases the incentive of AT&T-DIRECTV to use

strategies that limit consumers' access to online video distribution services in order to

favor its own video services, the Commission requires AT&T-DIRECTV, as a

condition of this merger, to refrain from imposing discriminatory usage-based

allowances or other discriminatory retail terms and conditions on its broadband

Internet service.

Internet Interconnection Disclosure Requirements. Recognizing the importance of

interconnection to the operation of online video services, the Commission also

requires as a condition of this merger that AT&T-DIRECTV submit its Internet

interconnection agreements so that the Commission may monitor the terms of such

agreements to determine whether AT&T-DIRECTV is denying or impeding access to

its networks in anticompetitive ways through the terms of these agreements.

Discounted Broadband Services for Low-Income Subscribers. While finding that the

availability of better and lower priced bundles of video and broadband service is a

potential benefit of the merger, the Commission also concludes that the public

interest requires us to ensure that a bundle of video and broadband services is not the

only competitive choice for low-income subscribers who may not be able to afford

bundled services. The Commission accordingly requires as a condition of the merger

that AT&T-DIRECTV make available an affordable, low-price standalone broadband

service to low-income consumers in its broadband service area.

Compliance Program and Reporting. Given the important role that these conditions

serve in securing the public interest benefits of the merger, the Commission requires

that AT&T-DIRECTV retain both an internal company compliance officer and an

independent, external compliance officer that will report and monitor, respectively,

the combined entity's compliance with all conditions of the merger.

Action by the Commission July 24, 2015 by: Memorandum Opinion and Order (FCC No. 15-94).

Chairman Wheeler and Commissioner Clyburn and Commissioner Rosenworcel, with

Commissioner O'Rielly concurring in part, and Commissioner Pai dissenting in part. Chairman

Wheeler, Commissioners Clyburn, Rosenworcel, Pai and O'Rielly issuing statements.

MB Docket No. 14-90

###

Office of Media Relations: (202) 418-0500

TTY: (888) 835-5322

Twitter: @FCC

www.fcc.gov/office-media-relations

This is an unofficial announcement of Commission action. Release of the full text of a Commission order

constitutes official action. See MCI v. FCC, 515 F.2d 385 (D.C. Cir. 1974).

LINK:	http://www.fcc.gov/document/fcc-grants-approval-att-directv-transactio...
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