AT&T, DirecTV and the future of NFL Sunday Ticket

Considering today’s merger news and  then looking back a year, it was really stunning that purchasing a $99 video game would provide access to NFL Sunday Ticket without a DirecTV subscription.   Now we hear that AT&T plans to buy DirecTV –  but only if the NFL Sunday Ticket is part of the deal

DirecTV currently pays the NFL $1 billion per year for the rights to NFL Sunday Ticket.  That’s approximately $49.51 for each of DirecTV’s 20.2 million subscribers.  According to estimates by iStockAnalyst approximately 15 to 21.6 % of these also take NFL Sunday Ticket.

Will AT&T taking control of NFL Sunday Ticket benefit the consumer in any way? Don’t count on it. AT&T seems to be extremely good at growing market share through brute force tactics. Think back to the launch of the iPhone – an AT&T exclusive at the time – which paid off. AT&T is likely to use NFL Sunday Ticket effectively to compete with Comcast for market share. It’s a good bet that AT&T will kill any cord cutter friendly ideas  like offering NFL Sunday Ticket via Playstation or  including it with the Madden  video game.

If AT&T/DirecTV/NFL Sunday Ticket goes through it will be bad for consumers for multiple reasons:

The YouTube video above captures precisely my experience with this company. In the video the customer has spent hours on the phone trying to get a simple issue resolved. Several years back I used AT&T’s U-verse and  then later AT&T’s DSL. Somehow AT&T managed to mix up my payments so that one account accumulated a credit and the other kept going past due. It took hours to resolve.

Where I live the Pay TV market consists of the following:

  1. Time Warner Cable
  2. AT&T U-Verse
  3. Dish
  4. DirecTV

Unlike the Comcast/TWC deal, AT&T/DirecTV truly eliminates a competitor.  And NFL Sunday Ticket is the tool that will help them do that. Many happy DirecTV customers will reluctantly switch over to AT&T to keep NFL Sunday Ticket.

Back in  2011 AT&T attempted to purchase T-Mobile but the DOJ nixed the deal because it would eliminate competition. I can’t see any reason why  AT&T/DirecTV should be approved by regulators. Can you?



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