For AT&T to pull off its $48.5 billion acquisition of satellite TV service provider DirecTV, the company is willing to promise access to ultra high-speed Internet.
More specifically, AT&T told regulators that it was ready to invest in building out its Gigapower fiber Internet service — which offers download speeds of up to 1 gigabites per second — so that it would be available in 2 million homes, according to a regulatory filing yesterday. Of course, this is contingent on the DirecTV deal going through.
AT&T and DirecTV announced the deal last month. It would give the telecom company a nationwide TV service product that it could then bundle with its wireless phone/data service. However, the deal was immediately criticized as yet another way media companies are slowly conglomerating rather than innovating. It also follows a massive merger of the country’s two largest cable providers, Comcast and Time Warner Cable, in a deal worth $45.2 billion.
And while faster Internet might sound nice, there’s plenty of reason to be skeptical of AT&T’s promise. For instance, DSL Reports points out that AT&T was already planning to upgrade 2 million homes with access to Gigapower service as a way to stay competitive against Google Fiber, which has a pretty strong and positive PR buzz.
Additionally, the AT&T-DirecTV deal would mean less competition for TV and Internet service for consumers and would empower AT&T to demand more money from content programmers as well as from consumers.