AT&T really does not know what it wants to do, when it comes to streaming TV. First it purchased DirecTV, and then created DirecTV NOW. Then it decided to combine DirecTV with U-Verse, and have AT&T TV with DirecTV NOW being renamed to AT&T TV Now. AT&T TV and TV Now were basically the same, with the only real difference being the requirement of a set-top box.
Now, AT&T has decided to spin DirecTV out. The spin-off is now complete, after being announced in February. AT&T still has a 70% ownership of DirecTV, while a private equity firm, TPG holds the remaining 30%. This spin-off also changes the name for AT&T TV Now, making it DirecTV Stream.
AT&T spent a ton of money to say “nevermind” a few years later
AT&T paid $67 billion for DirecTV back in 2014. Including nearly $20 billion in debt. And now it is spinning it out as it’s own company, because it changed its mind on what to do with the satellite provider.
But DirecTV isn’t the only acquisition that AT&T made and then changed its mind. It bought Time Warner for $85.4 billion two years later. And now it is merging HBO MAX with Discovery, as it looks to get out of the content game. The Time Warner merger was a much bigger deal, as AT&T spent months in court telling the DOJ that it was not becoming a monopoly. So it likely spend closer to $100 billion to acquire Time Warner after the court costs. And it took two years to close – closing in 2018.
That’s a lot of money to spend, to later change your mind. But this is probably for the best for AT&T. At one point, it had nearly six different streaming services. And now it’ll be down to just two – and it doesn’t even fully own either of them.