AT&T made a big splash this past weekend by announcing a merger with satellite TV provider DirecTV. While opinions on the deal range from acceptance to anger, many questioned whether the Federal Trade Commission (FTC) and the Federal Communications Commission (FCC) would ever allow such a deal to go through.
It appears that they may not actually get a chance to weigh in on the deal because, according to the LA Times, the contract between the two TV giants has a clause that dissolves the merger if DirecTV does not successfully retain the rights to NFL Sunday Ticket on "substantially the terms discussed between the parties." DirecTV has been in negotiations with the NFL to keep the package exclusive to the satellite provider, but the price tag has historically been very steep: DirecTV pays $1B a year for exclusive rights to the service, and there"s whispers that the price tag could increase to $1.4B once it expires after the 2014 season.
The constantly escalating price tag, combined with games broadcast for free on Thursday nights, has led many fans to cancel Sunday Ticket and watch their games other ways, so it"s questionable whether DirecTV sees the same value in Sunday Ticket that the NFL does. This new contract information probably isn"t going to make negotations any easier for the television provider.
Source: LA Times | Image Courtesy of AT&T