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1/ Remember when critics were panicking about AT&T& #39;s acquisition of DirecTV 5 years ago? Well, now T is already looking to sell at considerable loss. https://www.wsj.com/articles/at-t-again-exploring-a-deal-for-directv-11598645254?mod=hp_lead_pos4">https://www.wsj.com/articles/...
It& #39;s another powerful example of technological change decimating market power. But the weird thing is..
It& #39;s another powerful example of technological change decimating market power. But the weird thing is..
2/ history repeated here & neither business exes or regulators learned any lessons. This exact same thing happened to Rupert Murdoch 15 years ago when he & News Corp took a considerable loss on DirecTV, calling it a "turd bird" while spinning it off. http://www.dslreports.com/shownews/Murdoch-Waves-Goodbye-to-His-Turd-Bird-aka-DirecTV-80132">https://www.dslreports.com/shownews/...
3/ At time of News Corp-DirecTV deal, one FCC Commissioner worried the deal would “result in unprecedented control over local & national media properties in one global media empire. Its shockwaves will undoubtedly recast our entire media landscape.”
Couldn& #39;t have been more wrong
Couldn& #39;t have been more wrong
4/ at same time, regulatory advocate Jeff Chester predicted that Murdoch would use this “Digital Death Star” to "force his programming on cable companies by threatening a price war unless they give Fox favorable access."
LOL, nope. Nothing of the sort happened.
LOL, nope. Nothing of the sort happened.
5/ I documented this whole tale in my 2009 paper, "A Brief History of Media Merger Hysteria: From AOL-Time Warner to Comcast-NBC." #_ftnref30">https://techliberation.com/2009/12/02/a-brief-history-of-media-merger-hysteria-from-aol-time-warner-to-comcast-nbc/ #_ftnref30">https://techliberation.com/2009/12/0...
History shows how media markets are extremely dynamic and prone to disruptive change and technological leap-frogging.
History shows how media markets are extremely dynamic and prone to disruptive change and technological leap-frogging.
6/ But then AT&T walked right into the trap and this story played out again!! And, right on cue, the regulators used the same panicked rhetoric as they did a decade prior.
Nobody learned anything from history apparently.
Nobody learned anything from history apparently.
7/ Prediction: AT&T will soon sell DirecTV at a considerable loss. Charlie Ergen will try to make a DISH-DTV marriage happen. #Antitrust regulators will go nuts & move to block horizontal deal based on yesterday& #39;s market definitions. The firms will crash & burn after deal denied.
8/ And that& #39;ll mean history will also repeat again because then this will just be a replay of the Blockbuster & Hollywood Video failed merger in 2005! FTC moved to stop that horizontal deal even though markets were already decimating video rental markets. https://www.nationalreview.com/2020/07/antitrust-regulation-rapidly-changing-marketplace-requires-humility/">https://www.nationalreview.com/2020/07/a...
9/ Perhaps one day telecom execs & regulators will learn something by reading a little history and exercising a little humility.
Technological change is mighty wrecking ball.
/end.
Technological change is mighty wrecking ball.
/end.
