U.S. regulators said Tuesday they were set to back the $49 billion merger of AT&T and DirecTV, clearing the way for a powerful player in Internet and television.
Federal Communications Commission (FCC) chairman Tom Wheeler said in a statement that an order was circulated at the agency recommending approval of the mega-deal with certain conditions.
Wheeler said the merger would "directly benefit consumers by bringing more competition to the broadband marketplace ... If the conditions are approved by my colleagues, 12.5 million customer locations will have access to a competitive high-speed fiber connection." The Justice Department said in a separate statement it would not challenge the merger. The news comes three months after regulators blocked a massive merger plan of cable giants Comcast and Time Warner Cable, claiming it would concentrate too much market power in the market for high-speed Internet. But merging AT&T and DirecTV could create competition because the telecom giant and satellite broadcaster do not have the same geographical territories as the traditional cable firms. Wheeler said if the conditions are accepted, the merged firm would boost the availability of high-speed fiber-optic connections for television, Internet and other services. "This additional build-out is about 10 times the size of AT&T's current fiber-to-the-premise deployment, increases the entire nation's residential fiber build by more than 40 percent and more than triples the number of metropolitan areas AT&T has announced plans to serve," he said.
Wheeler said AT&T would also be required to agree not to discriminate against competing video services and to accept a monitor to ensure it follows Open Internet rules.
