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Fox Business Network's Gasparino: Street Pushes AT&T to Unload DirecTV on Dish

Fox Business Network's Gasparino: Street Pushes AT&T to Unload DirecTV on Dish
(Tracy King/Dreamstime)

By    |   Wednesday, 18 September 2019 03:01 PM

Wall Street bankers have been pushing AT&T Inc.’s DirecTV subsidiary to sell off the satellite TV operator, with Charlie Ergen’s Dish Network as one potential suitor, Fox Business Network reported.

The report comes as AT&T's DirecTV has been rocked by more than a million customers quitting the service in the past year.

Wall Street investment bankers are telling AT&T there is a simple solution that would involve a sale of DirecTV or a merger, people familiar with the matter told Fox Business Network, according to an article co-authored by FBN’s Charles Gasparino and Lydia Moynihan.

Among the deals being pushed "is one where DirecTV teams up with Dish Network by spinning off the companies into a separate unit or a merger that could be financed with capital from private equity firms since Dish — with 12 million subscribers — is a significantly smaller company than DirecTV," people with knowledge of the matter told Fox Business Network..

AT&T says it expects another 1.1 million subscribers to drop DirecTV and other TV services in Q3 of this year as customers leave for less expensive options.

Fox Business Network also has learned that DirecTV may be the focus of a boycott engineered by outside advisers to President Trump, who has been critical of the news coverage of AT&T subsidiary CNN.

Trump has called on his supporters to boycott AT&T services in the past to put pressure on CNN to changes its coverage of the White House, and outside advisers have told the president that DirecTV may be most vulnerable of AT&T’s units to a customer boycott, people with knowledge of the matter told FBN.

Meanwhile, AT&T has been hit with a class-action lawsuit alleging it pumped up the subscriber count for its DirecTV Now streaming service, artificially increasing the company's share price. The suit was filed in the Southern District of New York on behalf of various individuals and union pension fund stockholders.

Plaintiffs in the lawsuit claim AT&T CEO Randall Stephenson and company executives used fraudulent means to up subscriber count for their service, now known as DirecTV Now, to show increasing accounts while masking "serious technical problems due to premature roll-count," according to Multichannel News.

The suit, citing 17 former AT&T employees, claimed AT&T and "executive defendants," including CEO Randall Stephenson, "falsely depicted DirecTV Now as a fast-growing product with increasing subscribers and strong margins that would offset declining subscriber levels in AT&T's other video products, including its mature satellite DirecTV product."

The suit alleges AT&T salespeople were directed to bundle multiple accounts in a single activation, according to Multichannel.

An AT&T spokesperson said: "We plan to fight these baseless claims in court."

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Wall Street bankers have been pushing AT&T Inc.’s DirecTV subsidiary to sell off the satellite TV operator, with Charlie Ergen’s Dish Network as one potential suitor, Fox Business Network reported.
att, directv, dish, fox, gasparino
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2019-01-18
Wednesday, 18 September 2019 03:01 PM
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