AT&T Might Agree To Adhere To Neutrality Rules To Seal Its $49 Billion DirecTV Purchase, But Probably Not

from the believe-it-when-you-see-it dept

There's not a company around that hates the FCC's net neutrality rules more than AT&T, as its two lawsuits against them attest. There's a pretty obvious reason: AT&T's been at the bleeding edge of obnoxious, neutrality-trampling network pricing models for a decade, and obviously doesn't want the government interfering in these ambitions. But at the same time, the telco wants regulators to sign off on its $49 billion acquisition of DirecTV (including the exclusive out of market broadcast rights of NFL Sunday Ticket). As such, the Washington Post claims AT&T is telling regulators it will agree to net neutrality to get the deal approved:

"Among the deal's so-called conditions is expected to be something fairly simple. AT&T is prepared to accept aspects of the net neutrality rules adopted by the Federal Communications Commission earlier this year, according to people familiar with the negotiations, who declined to be named because the deliberations are private."

Can you spot the one word in that paragraph that should cause reservations as to AT&T's sincerity? ISPs have long stated they're fine with some "aspects" of the FCC's net neutrality plan, most notably the no blocking or service throttling provisions -- since they've never really had an interest in that. There's no money in it, and it's a PR minefield. They're focused on notably more clever and less obvious abuses of net neutrality, including usage caps, interconnection, and zero-rated apps, where users and companies can be nickel-and-dimed under the pretense of ordinary business behavior.

And indeed, as the Post moves on to talk about interconnection issues, you'll note AT&T's enthusiasm for cooperation wanes notably:

"Critics of the DirecTV acquisition have asked that, as part of the deal, the FCC require AT&T to route incoming content to consumers without levying a fee on the companies sending the traffic. In reply, AT&T has said that its recent deals with content delivery firms such as Level 3 show that the current system of privately negotiated contracts is working properly."

Of course, the only reason AT&T struck a deal with Level 3 is because it was worried about running afoul of the FCC's net neutrality rules, which actually suggests it's the FCC's neutrality rules (in fact the mere threat of them) that's working properly. AT&T doesn't want the FCC policing caps either; we recently noted it's also trying to argue that any merger conditions that prevent it from abusing usage caps will somehow hurt fixed-line broadband competition, despite the fact AT&T's only using usage caps in markets with less competition in the first place.

So while the Post headline proudly proclaims claims that AT&T's eager to adhere to net neutrality rules to get the deal done, the reality is there's absolutely no indication the telco intends to adhere to any of the parts of the net neutrality rules that actually matter. Most reports suggest regulators will be signing off on the deal all the same, potentially seeing a $49 billion acquisition of a satellite company in the age of cord cutting as telecom seppuku anyway. Still, it's kind of amazing how the outrage over the Comcast deal helped AT&T's deal fly under the radar, despite the fact that the elimination of a direct pay TV competitor likely won't do the pay TV market or consumers any favors.

Filed Under: deals, mergers, net neutrality
Companies: at&t, directv