AT&T’s Bid for DirecTV Advances

AT&T’s proposed $48.5 billion takeover of the satellite company DirecTV is on the path to receiving a regulatory green light after Federal Communications Commission Chairman Tom Wheeler circulated a final order to approve the deal with conditions. The Justice Department also announced that it would not challenge the acquisition. The deal would create the country’s largest television distributor with about 26 million subscribers, surpassing Comcast, the current leader.

The FCC reviewed whether the deal, announced in May 2014, would serve the public interest; the Justice Department review was to determine whether it would harm competition. Chairman Wheeler said that the proposed order outlined a series of conditions that would benefit consumers by increasing competition in the broadband market. Under one condition, AT&T would be required to build its current high-speed fiber Internet connection to about 10 times its current size, extending the service to 12.5 million customer locations. To prevent discrimination in the online video market, AT&T would not be allowed to exclude affiliated video services and content from data caps on its fixed broadband connections, Chairman Wheeler said. And to create more transparency, it also would be required to submit so-called interconnection agreements to the FCC. Such agreements provide for a company like Netflix to pay a fee to a distributor, like Comcast or AT&T, for better service when it creates a lot of traffic for a network. The FCC also would require an independent officer to ensure that the company complied with these and other conditions. The final order and the conditions are subject to the approval of the F.C.C.’s other commissioners.