AT&T could drop DirecTV deal if NFL doesn’t play ball

Nate Swanner - May 19, 2014
AT&T could drop DirecTV deal if NFL doesn’t play ball

A regulatory filing for the AT&T acquisition of DirecTV shows the deal could go pear-shaped if the NFL doesn’t play ball. Sunday Ticket, DirecTV’s popular NFL package, is up for renewal. If they can’t come up with an amicable new deal with the NFL, DirecTV and AT&T could go their separate ways.

The filing states, in part, “the parties also have agreed that in the unlikely event that the Company’s agreement for the ‘NFL Sunday Ticket’ service is not renewed on substantially the terms discussed between the parties, AT&T may elect not to consummate the merger.” Costing customers hundreds of dollars annually, the Sunday Ticket is believed to be worth about $1 Billion to the NFL.

DirecTV CEO Mike White is confident a deal will get done, and notes talks with the NFL are “positive and constructive”. The current agreement runs its course at the end of the 2014-2015 season, leaving one year left. The DirecTV/AT&T deal is expected to take a year or so to be finalized, so that runs congruent to a new day for both companies.

There is currently no reason to think a deal won’t be made, but if things go sideways, it could be a major problem. Sports deals are a big money-maker for cable and satellite providers lucky enough to have them, and Sunday Ticket was likely a big attraction for AT&T.

Source: Reuters

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