AT&T’s Pitch to the Feds: Let Us Buy DirecTV, and Maybe TV Bills Won’t Go Up So Much
Remember when AT&T told investors that it could cut its programming bills by 20 percent if it buys DirecTV?
That was last week. This week, AT&T is telling regulators why they should let it buy DirecTV, and it’s making a similar argument. One difference: AT&T told investors its own bills would shrink. But it’s not saying that about the bills of its customers.
Instead, AT&T is telling the feds, via a public filing, that combining with DirecTV may help slow the rate that your TV bill goes up. But it can’t promise it will go down.
Instead it uses the words “downward pressure.” As in: “There will be significant downward pressure on the prices of the new integrated bundles of AT&T broadband and DIRECTV video, even without factoring in the improved quality such bundles will offer consumers.”
To be fair, AT&T argues that this pressure will come into effect without factoring in the 20 percent cost savings it told investors about. So it’s always possible that AT&T CEO Randall Stephenson could pass those savings along to his customers. But that’s a promise AT&T isn’t making.
One other note about pricing: AT&T’s summary of its filing also notes that there may be “upward pressure” on the prices of video or broadband services that aren’t bundled together. But it says if that’s the case it will be “significantly outweighed by the downward pressure [AT&T’s emphasis] on the prices of bundles of AT&T broadband and DIRECTV video that will now be available at improved quality and attractive prices.”
I’ve asked AT&T for clarification, but to me that reads as if the company is looking into the future and predicting a scenario where broadband prices for cord-cutters go up a lot faster than broadband prices for people who also buy pay TV from AT&T. And that AT&T is saying that’s no big deal, because people should just buy broadband and pay TV from AT&T, and stop worrying about it.
Which may very well be what the future holds. I’m just not sure I would say that out loud if I were Randall Stephenson.
Update: One alternate interpretation of AT&T’s upward/downward language — AT&T is trying to say that it will have incentive to sell standalone broadband at competitive prices, so that it could eventually upsell those customers into bundles that include video. But if that’s what they mean, it would be easier to just say that out loud.