3 Reasons AT&T Is Buying DirecTV

Before you go, we thought you'd like these...
Before you go close icon

Apparently, mergers and acquisitions are en vogue among companies in the telecom and media space this spring, as a wave of deal-making has swept through the sector in the past several weeks such as AT&T's recently approved buyout of DirecTV .

The AT&T acquisition of DirecTV comes on the heels of other mega deals including the Comcast-Time Warner buyout. Word also has it that Sprint is preparing a deal for the resurgent T-Mobile as well, although DISH Network is also waiting in the wings if Sprint's bid fails. 

Some of these deals stand a better chance of gaining the requisite regulatory approval, although it appears few believe the AT&T bid for DirecTV will face undue scrutiny. So with that in mind, let's look at why AT&T wanted to buy DirecTV altogether.

We bundle, you save?
There are plenty of reasons that AT&T will be in a fundamentally stronger competitive position once it acquires DirecTV.

For starters, DirecTV helps AT&T remedy one of its most glaring product shortcomings: the lack of a sizable pay-TV offering that AT&T can help bundle with other services. Beyond that, DirecTV's higher growth Latin American TV business will provide AT&T with a valuable new growth driver. And lastly, the combined synergies between the two will enable AT&T to roll out additional savings-fueled services to other parts of the country.

In the video below, tech and telecom specialist Andrew Tonner looks at these three key reasons behind AT&T's bid for DirecTV in greater detail.

Your cable company is scared, but you can get rich
You know cable's going away. But do you know how to profit? There's $2.2 trillion out there to be had. Currently, cable grabs a big piece of it. That won't last. And when cable falters, three companies are poised to benefit. Click here for their names. Hint: They're not Netflix, Google, and Apple. 


The article 3 Reasons AT&T Is Buying DirecTV originally appeared on Fool.com.

Andrew Tonner has no position in any stocks mentioned. The Motley Fool recommends DirecTV. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2014 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

People are Reading