Matt Daneman

While required to build fiber to 12.5 million homes by 2019 as one of the conditions of its purchase of DirecTV, that fiber buildout size could be a floor rather than a ceiling, AT&T Chief Financial Officer John Stephens said Wednesday during the Wells Fargo investor conference. "We would be willing to do more." Stephens also said DirecTV integration is ahead of schedule regarding cost management. "We kept [revenue generation] expectations tempered," he said. "We thought it would take a year to get things going, and it has." AT&T revenue expectations also have been hampered by a tepid U.S. economy, he said. While the carrier has announced a $35 price point for its upcoming DirecTV Now streaming service (see 1610250053), the company plans to subsequently add features and content that will result in other price points, he said. Stephens also said one aim of DirecTV Now is as an entry point to the market of 20 million or so U.S. households without pay TV, letting AT&T then try to bundle broadband or other services with it.

Fates of major media takeovers such as AT&T's planned buy of Time Warner now carry major question marks with the incoming Donald Trump administration, experts say. Uncertainty will surround the regulatory environment for such transactions until the heads of the DOJ and FCC are named, Dish Network CEO Charlie Ergen said Wednesday. Noted BTIG analyst Richard Greenfield, "Honestly, until we understand the extent of Trump’s views on the dangers of media industry consolidation, it is impossible to know what deals could get done under his administration."

The alleged collusion among multichannel video programming distributors that's the focus of a DOJ lawsuit against DirecTV is more commonplace than just the MVPDs' interactions with regional sports network (RSN) SportsNet LA, programmers tell us. No one in the pay-TV industry is shocked by the DOJ complaint calling AT&T-owned DirecTV the ringleader of an information-sharing cabal of MVPDs trying to negotiate with the RSN (see 1611020034), but there is surprise about how the DOJ got the information it cites in its complaint, one independent programmer CEO told us. AT&T, DOJ and NCTA didn't comment.

Charter Communications expects to have a wireless service offering broadly available in its footprint by late next year or early 2018, CEO Tom Rutledge said during the company's Q3 earnings call Thursday. "It is a substantial business and requires significant planning."

The entwined issues of zero rating and of programming access and discrimination likely will be a key focus of regulatory review of AT&T's proposed takeover of Time Warner, experts tell us. Meanwhile, the $108.7 billion deal comes amid DOJ allegations that DirecTV -- now part of AT&T -- was the ringleader of an information-sharing collective of multichannel video programming distributors trying to negotiate with the SportsNet LA regional sports network.

The money that could change hands between AT&T and Time Warner if the carrier's planned $108.7 billion buy of the programmer doesn't go through could point to relative confidence the deal will get regulatory approval, or it might reflect the buyer's skittishness about breakup fees since the $3 billion plus spectrum it had to pay T-Mobile after that failed pursuit, experts tell us. AT&T likely also would have been concerned about agreeing to a big breakup fee given the regulatory environment, said George Geis, faculty director of UCLA Anderson School of Management's Mergers and Acquisitions Executive program. Vertical combinations -- like distributor AT&T buying content company TW -- generally get somewhat less regulatory scrutiny than horizontal deals involving two competitors, but the political calls for strict scrutiny of this transaction indicate "it's going to be reviewed, no question," Geis said.

As the FCC considers rules on how multichannel video programming distributors (MVPD) deal with independent programmers, one issue remains how to define an independent programmer. Multiple cable lawyers told us the proceeding, which some expect to get more active once the FCC finishes more high-profile agenda items affecting the cable industry, potentially could see some major programmers trying to argue they fall into that indie category. Meanwhile, AT&T's proposed $108.7 billion buy of Time Warner could help spur the FCC into adopting the rules in the indie programming NPRM adopted in September (see 1609290036), given worries that AT&T -- owning its own programming content -- would have incentives to discriminate against other programmers, multiple cable lawyers said. Some speculated the FCC, if not part of any regulatory review of the deal, might look at rulemakings on issues like program access or program carriage to try to ensure a competitive marketplace (see 1610260022).

The Intelsat 33e satellite is expected to be in service in early 2017, CEO Stephen Spengler said during the company's Q3 earnings call Thursday. It and Intelsat 36 satellites were launched in August (see 1608250021), with 33e being the second of the company's high-throughput seven-satellite Epic constellation. The company has three more launches scheduled in 2017: Intelsat 32e, an Epic satellite, in Q1, Intelsat 35e in Q2 and Intelsat 37e in Q4, it said in a news release. Spengler said the company still is being hit with pricing pressures, though network services seem to be stabilizing. For the quarter, Intelsat had revenue of $542.7 million, down 7 percent due to network services declines, but up from Q2 due to revenue from direct-to-home satellites launched earlier this year, Spengler said.

Iridium's Next constellation likely won't be fully deployed until 2018 and the company isn't sure when the inaugural Next launch by SpaceX will take place, said Iridium CEO Matthew Desch during the company's Q3 earnings call Thursday. That first launch was slated for September, but SpaceX's ongoing investigation of an explosion during a Sept. 1 preflight ignition test remains underway, Desch said. He said SpaceX indicated it expects to resume launches this year, and one of them "will presumably include ours." Desch said Iridium was comfortable with the progress SpaceX is making in its launch investigation. SpaceX has said that, pending the results of its investigation, it expects to resume launches as early as November. It didn't comment Thursday on which missions would go up when. Despite the launch delays and the loss of two satellites earlier this year (see 1607280006), Iridium's existing constellation "is operating well" and has one in-orbit spare, Desch said, saying there haven't been any signs of battery failure. The loss of two satellites caused some small outages, though the company's customer availability statistics are still high, Desch said. The first two Next constellation launches are targeted to plug those two holes, he said. Iridium also had expected to be able to launch its L-band Certus broadband service commercially in mid-2017 (see 1606070018), but "it could be a little later" given the launch delays, Desch said. Meanwhile, Iridium could start deorbiting its legacy satellite constellation as soon as 2017, he said, with that process expected to be complete by 2019. Iridium revenue for the quarter was $112.8 million, up 6 percent year over year, due mostly to government services, Chief Financial Officer Thomas Fitzpatrick said. He said the company still is seeing declines in traditional telephony usage.

AT&T's proposed buy of Time Warner could get opposition from parties ranging from programmers and public interest groups to Dish Network, but support could be harder to come by as many may remain neutral and not get involved with lobbying regulators and policymakers, cable industry experts told us. Industry groups like NCTA and USTelecom likely won't get involved, since organizations that have multiple interests might have a tough time coming to a unified stance, some said, though not everyone agreed. An NCTA spokeswoman said it typically doesn't comment on deals and didn't during Comcast/NBCUniversal, Charter/Time Warner Cable/Bright House Networks and the foiled Comcast/TWC. USTelecom didn't comment Thursday. Meanwhile, the Senate Judiciary Committee confirmed Thursday that its Antitrust Subcommittee plans an AT&T/Time Warner oversight hearing Dec. 7 with the CEOs of both companies, as expected (see 1610260070).