By Anirban Sen
(Reuters) – Telecom operator AT&T and its partner TPG are in the early stages of talks to merge their DirecTV satellite TV service with EchoStar-owned Dish, a person familiar with the matter told Reuters on Friday.
The two companies first tried to merge in 2002 when the US Department of Justice blocked the merger. The combined entity would create the largest pay-TV service provider in the US with about 16 million subscribers, if the talks are successful. The potential deal would likely attract antitrust scrutiny again, though it might be able to clear regulatory hurdles this time as the industry has expanded significantly since then and DirecTV and Dish now compete against the likes of Comcast, Charter, Amazon Prime, YouTube TV and Netflix. A merger would improve the combined company’s ability to negotiate with programmers, much like DirecTV is doing with Disney right now as the two sides are locked in a cart dispute.
For Dish, the deal would allow them to focus all of their investments on building out their 5G wireless network.
“Rumors of a potential transaction involving DirecTV and Dish are nothing new, but we do not comment on rumors and speculation,” a DirecTV spokesperson said in an email to Reuters.
DirecTV and Dish have been in on-and-off talks over the years since their first attempt to merge was blocked in 2002.
EchoStar completed its acquisition of Dish in late 2023.
Dish did not immediately respond to Reuters requests for comment outside business hours. TPG and AT&T declined to comment.
DirecTV is facing a public battle with Disney that has resulted in 11 million DirecTV customers losing access to ESPN in the middle of the US Open tennis tournament.
The dispute comes amid a competing plan by Disney, Fox and Warner Bros Discovery to launch a joint venture for video streaming dedicated to sports, called Venu Sports.
The launch was temporarily blocked by a court injunction as part of a lawsuit by sports streaming rival FuboTV that accused the media companies of anti-competitive behavior.
Bloomberg reported on the talks between Dish and DirecTV earlier on Friday.
(Reporting by Anirban Sen, Additional reporting by Urvi Dugar, Harshita Meenaktshi and Dawn Chmielewski; Editing by Sandra Maler, Rosalba O’Brien and Michael Perry)