AT&T-DirecTV merger may hinge on NFL agreement

[Yo_Mama_Been_Loggin]

Reuters) - AT&T Inc can pull out of its agreement to buy DirecTV if the satellite TV operator is unable to renew a deal with the National Football League to offer the popular NFL Sunday Ticket football package, according to a regulatory filing on Monday.

The current DirecTV offer allows subscribers to watch football games outside of their local markets on Sundays. The exclusive package, which costs subscribers up to $300 a year, is an important tool for DirecTV to attract subscribers and the company has said about 2 million people receive the service.

In a filing related to the acquisition, the companies said: "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."

Investors have been watching closely to see whether DirecTV would renew the Sunday Ticket contract with the NFL, estimated to be worth $1 billion annually, with the potential to rise in value as part of a new agreement.

The filing said that if a renewal isn't struck, AT&T will not be able to claim damages as long as DirecTV used its best efforts to get a deal done with the NFL.

http://www.reuters.com/article/2014/05/19/us-att-directv-idUSBREA4I0I520140519


One of the reasons cable rates are so darned high is the price the companies have to pay to carry certain sports programming. As a sports fane myself I watch said programming but I'm pretty certain the non-sports viewer is less than happy about paying for programming they don't watch.