# Rumor on the Street: Verizon to Make Bid for DirecTV



## Ken S (Feb 13, 2007)

Verizon (NYSE: VZ) just might be ready to make a move on DirecTV (NYSE: DTV), the WSJ speculates, as the telco turns its concentration to video as its "core product."

Link: http://paidcontent.org/article/419-verizon-might-be-considering-directv-bid/

A similar story is also in the Wall Street Journal.


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## Steve (Aug 22, 2006)

Ken S said:


> Verizon (NYSE: VZ) just might be ready to make a move on DirecTV (NYSE: DTV), the WSJ speculates, as the telco turns its concentration to video as its "core product."
> 
> Link: http://paidcontent.org/article/419-verizon-might-be-considering-directv-bid/
> 
> A similar story is also in the Wall Street Journal.


Interesting. Based on Mr. Malone's past deals, he'll want it to be a "tax free" transaction. If more than a rumor, it will be interesting to see how this deal unfolds.


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## Movieman (May 9, 2009)

I think its more likely that AT&T buy Directv than Verizon. I honestly dont see either one buying Directv but I think AT&T would make more sense.


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## RAD (Aug 5, 2002)

Movieman said:


> I think its more likely that AT&T buy Directv than Verizon. I honestly dont see either one buying Directv but I think AT&T would make more sense.


Why do you think AT&T makes more sense? Both AT&T and Verizon have agreements in place to resell DirecTV services. Both of them could use DirecTV to provide service to areas where they don't have physical plant. Just curious what your reasoning is.


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## David MacLeod (Jan 29, 2008)

rumor on street.
Dave MacLeod named CEO of DirecTv.
there, since we're speculating


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## oldschoolecw (Jan 25, 2007)

Movieman said:


> I think its more likely that AT&T buy Directv than Verizon. I honestly dont see either one buying Directv but I think AT&T would make more sense.


There both apart of Ma Bell


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## oldschoolecw (Jan 25, 2007)

David MacLeod said:


> rumor on street.
> Dave MacLeod named CEO of DirecTv.
> there, since we're speculating


Who's he?


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## Movieman (May 9, 2009)

RAD said:


> Why do you think AT&T makes more sense? Both AT&T and Verizon have agreements in place to resell DirecTV services. Both of them could use DirecTV to provide service to areas where they don't have physical plant. Just curious what your reasoning is.


When I worked for AT&T the talk from the top was clear regarding IPTV. Although they were supposed to role it out very similar to FIOS and someone changed their minds. Also, my buddy that works for AT&T Corp told me months ago that they were looking at *alternatives* due to the financial scale back of U-Verse. Verizon on the other hand is doing great with FIOS. Sure they could use it for their footprint but again they are expanding FIOS much better than U-Verse is expanding. Dont mean Im right but its my thought being that I worked for these guys for many, many, years. Also, AT&T in Florida has been lobbying a lot of certain changes that deal with Directv services.



oldschoolecw said:


> There both apart of Ma Bell


Correct. AT&T and BellSouth and SouthernBell for those of us in the South East. Verizon I think was BellAtlantic and did the change over after they started buying up smaller carriers like Primeco in Florida. This is going a little back in time and dont remember all the names.

Im not saying im right but I deal a lot with the telecom industry in my career and AT&T is making a lot of inquisitions. Verizon is not at least for now. We will see.


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## oldschoolecw (Jan 25, 2007)

Movieman said:


> Correct. AT&T and BellSouth and SouthernBell for those of us in the South East. Verizon I think was BellAtlantic and did the change over after they started buying up smaller carriers like Primeco in Florida. This is going a little back in time and dont remember all the names.
> 
> Im not saying im right but I deal a lot with the telecom industry in my career and AT&T is making a lot of inquisitions. Verizon is not at least for now. We will see.


Verizon is selling all there land line copper wire up here in the North East there becoming very aggressive with FioS and DirecTV would give them that edge they need

Verizon Boss Hangs Up on Landline Phone Business
http://bits.blogs.nytimes.com/2009/09/17/verizon-boss-hangs-up-on-landline-phone-business/?hpw


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## redsoxfan26 (Dec 7, 2007)

Movieman said:


> AT&T and BellSouth and SouthernBell for those of us in the South East. Verizon I think was BellAtlantic and did the change over after they started buying up smaller carriers like Primeco in Florida.


Here's the timeline: New England Telephone became NYNEX which became Bell Atlantic which became Verizon.


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## Ken S (Feb 13, 2007)

redsoxfan26 said:


> Here's the timeline: New England Telephone became NYNEX which became Bell Atlantic which became Verizon.


You forgot one....

AT&T became...

NJ Bell and several others became Bell Atlantic which then merged with NYNEX

and after all that they became AT&T again


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## David MacLeod (Jan 29, 2008)

oldschoolecw said:


> Who's he?


a nobody


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## oldschoolecw (Jan 25, 2007)

David MacLeod said:


> a nobody


But CATS DO RULE


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## Movieman (May 9, 2009)

oldschoolecw said:


> Verizon is selling all there land line copper wire up here in the North East there becoming very aggressive with FioS and DirecTV would give them that edge they need
> 
> Verizon Boss Hangs Up on Landline Phone Business
> http://bits.blogs.nytimes.com/2009/09/17/verizon-boss-hangs-up-on-landline-phone-business/?hpw


I heard something about this from my uncle you works in NY but since I work in Florida I dont deal with other areas very much. Thanks for the link. Its a good read. In terms of the timeline, I think I was too young to remember that.


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## bobnielsen (Jun 29, 2006)

redsoxfan26 said:


> Here's the timeline: New England Telephone became NYNEX which became Bell Atlantic which became Verizon.


GTE also became part of Verizon, so it ain't all Ma Bell.


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## jpl (Jul 9, 2006)

Ok... I admit it... I'M buying out DirecTV... It has as much validity as this rumor. Note the one thing absent from the article - a total lack of any kind of evidence. Nothing even circumstantial.

I'm not saying DirecTV can't/won't be bought out, but to me they're one of the least likely buy-out candidates in the industry. They're big and extremely popular/profitable, which means that they're expensive. Right now you have large cable systems facing chapter 11 who would be much easier pickings if the goal is simply to expand market-share. If I were looking to expand my TV service empire, about the last place I'd look is DirecTV - they're too expensive to be a real attractive candidate.

Then there's the little item about Verizon divesting a large chunk of its footprint to Frontier - including 3 fios territories. Yeah DirecTV would give them a video presence in those markets that aren't served by FiOS, but I struggle to see how DirecTV would fit into their long-range plans. This 'article' is nothing more than naked speculation that the author is trying to pass off as more than it really is.


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## Davenlr (Sep 16, 2006)

Movieman said:


> AT&T is making a lot of inquisitions. Verizon is not at least for now. We will see.


Ahhh, Verizon just bought our Arkansas based Alltel (you know, CHAD, the cell phone boy), renamed our Arena from Alltel to Verizon (you can still see where the old Alltel letters were in the concrete, and renamed the street to Verizon Way. Cost a pretty penny too, if I recall the news reports. No FIOS for us here yet tho, just remote pockets (in upper middle class neighborhoods) of U-VERSE so far.


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## Ken S (Feb 13, 2007)

jpl said:


> Ok... I admit it... I'M buying out DirecTV... It has as much validity as this rumor. Note the one thing absent from the article - a total lack of any kind of evidence. Nothing even circumstantial.
> 
> I'm not saying DirecTV can't/won't be bought out, but to me they're one of the least likely buy-out candidates in the industry. They're big and extremely popular/profitable, which means that they're expensive. Right now you have large cable systems facing chapter 11 who would be much easier pickings if the goal is simply to expand market-share. If I were looking to expand my TV service empire, about the last place I'd look is DirecTV - they're too expensive to be a real attractive candidate.
> 
> Then there's the little item about Verizon divesting a large chunk of its footprint to Frontier - including 3 fios territories. Yeah DirecTV would give them a video presence in those markets that aren't served by FiOS, but I struggle to see how DirecTV would fit into their long-range plans. This 'article' is nothing more than naked speculation that the author is trying to pass off as more than it really is.


C'mon...DirecTV has been marketed, bought and sold more than some ladies of the evening. Their CEO bailed after the latest buyout with no replacement yet named and they are arranging the corporate structure to make a sale easier. John Malone has never been known to fall in love with a company and hold on when confronted with a large payout.

The future of stand alone satellite TV providers isn't great. They need a fast 2-way tie with their customers to better compete with the cable guys.


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## jpl (Jul 9, 2006)

Ken S said:


> C'mon...DirecTV has been marketed, bought and sold more than some ladies of the evening. Their CEO bailed after the latest buyout with no replacement yet named and they are arranging the corporate structure to make a sale easier. John Malone has never been known to fall in love with a company and hold on when confronted with a large payout.
> 
> The future of stand alone satellite TV providers isn't great. They need a fast 2-way tie with their customers to better compete with the cable guys.


Malone bought the company in a much better economic environment. With many TV service providers struggling, there are much cheaper ways to expand your TV empire than going after one of the few TV providers actually expanding in the middle of a crappy economy. Capital isn't as easy to come by these days. Besides, even though both Verizon and AT&T are profitable, and have alot of cash, both have scaled back roll-outs of their respective systems partly because of economic conditions. Verizon is spending $23Billion on rolling out FiOS - and it has yet to turn a profit for them (even though it's getting close). I just don't think that even if they have the cash to by DirecTV that it makes sense for them to do so. While it would give them an in with parts of the country they don't serve (including more rural areas), DBS just doesn't seem to fit in with their long-range plans - they've not only moved heavily into video, but they've consolidated their footprint - focusing more on more heavily populated areas, and divesting large chunks of their current system.

A couple years ago, things were very different in the market. They've changed dramatically. Companies that were in a position to buy, are no longer able to, and companies that actually are growing in this market (like DirecTV) become VERY expensive under the current conditions. I guess what I'm saying is that under current economic conditions DirecTV is too expensive (in my opinion) to be a potential buy-out candidate.


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## Steve (Aug 22, 2006)

The article made the point that without lots of subscribers, Verizon might not be able to negotiate favorable rates for the channels it carries. Not sure how significant a # that is, but it might be a reason why the deal may be justified. It also allows them to get their feet in the door with other DirecTV customers for "triple-play" offerings. Even in areas where they don't have FiOs, they offer DSL and phone service.


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## bidger (Nov 19, 2005)

You can bet that TiVo is hoping that either company acquiring DIRECTV turns out to be just a rumor.


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## TheRatPatrol (Oct 1, 2003)

Ken S said:


> Verizon (NYSE: VZ) just might be ready to make a move on DirecTV (NYSE: DTV), the WSJ speculates, as the telco turns its concentration to video as its "core product."
> 
> Link: http://paidcontent.org/article/419-verizon-might-be-considering-directv-bid/
> 
> A similar story is also in the Wall Street Journal.


Good, we'll Versus back then. 



Movieman said:


> I think its more likely that AT&T buy Directv than Verizon. I honestly dont see either one buying Directv but I think AT&T would make more sense.


Or maybe Comcast will buy it. :eek2:


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## rey_1178 (Dec 12, 2007)

i would love to see verizon purchase directv. i hate the changes this current ownership has made.


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## Ken S (Feb 13, 2007)

jpl said:


> Malone bought the company in a much better economic environment. With many TV service providers struggling, there are much cheaper ways to expand your TV empire than going after one of the few TV providers actually expanding in the middle of a crappy economy. Capital isn't as easy to come by these days. Besides, even though both Verizon and AT&T are profitable, and have alot of cash, both have scaled back roll-outs of their respective systems partly because of economic conditions. Verizon is spending $23Billion on rolling out FiOS - and it has yet to turn a profit for them (even though it's getting close). I just don't think that even if they have the cash to by DirecTV that it makes sense for them to do so. While it would give them an in with parts of the country they don't serve (including more rural areas), DBS just doesn't seem to fit in with their long-range plans - they've not only moved heavily into video, but they've consolidated their footprint - focusing more on more heavily populated areas, and divesting large chunks of their current system.
> 
> A couple years ago, things were very different in the market. They've changed dramatically. Companies that were in a position to buy, are no longer able to, and companies that actually are growing in this market (like DirecTV) become VERY expensive under the current conditions. I guess what I'm saying is that under current economic conditions DirecTV is too expensive (in my opinion) to be a potential buy-out candidate.


Look at what Dell just paid for Perot's company....if they believe they have to expand they will. AT&T and Verizon see a big risk from companies like Comcast...they all want to offer the "triple play".


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## Ken S (Feb 13, 2007)

bidger said:


> You can bet that TiVo is hoping that either company acquiring DIRECTV turns out to be just a rumor.


Why would Tivo care? They have a contract with DirecTV and a company buying Dish would want the litigation cleaned up before the closing. Also, in the case of Dish...Echostar might not be included in a sale.


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## uncrules (Dec 20, 2005)

rey_1178 said:


> i would love to see verizon purchase directv. i hate the changes this current ownership has made.


This.


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## James_F (Apr 23, 2002)

Ken S said:


> Why would Tivo care? They have a contract with DirecTV and a company buying Dish would want the litigation cleaned up before the closing. Also, in the case of Dish...Echostar might not be included in a sale.


Clearly Verizon buying DirecTV would give them a license to TiVo patents and thus save them from the future lawsuit.


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## Jhon69 (Mar 28, 2006)

rey_1178 said:


> i would love to see verizon purchase directv. i hate the changes this current ownership has made.


Me Too!.


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## Robert L (Dec 13, 2005)

oldschoolecw said:


> Verizon is selling all there land line copper wire up here in the North East there becoming very aggressive with FioS and DirecTV would give them that edge they need
> 
> Verizon Boss Hangs Up on Landline Phone Business
> http://bits.blogs.nytimes.com/2009/09/17/verizon-boss-hangs-up-on-landline-phone-business/?hpw


Well, they are also selling area's that have FIOS, and I happen to be in one of those. I'm not thrilled about it and not sure what to make of Frontier, but the past sales Verison did hasn't worked put so well, as they talk about here.

http://www.circleid.com/posts/20090917_verizon_throws_18_states_under_progress_train/


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## oldschoolecw (Jan 25, 2007)

rey_1178 said:


> i would love to see verizon purchase directv. i hate the changes this current ownership has made.


There has been a drop in quality with this new ownership of DirecTV and being in Verizon country I also would love to see them purchase DirecTV.


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## oldschoolecw (Jan 25, 2007)

Robert L said:


> Well, they are also selling area's that have FIOS, and I happen to be in one of those. I'm not thrilled about it and not sure what to make of Frontier, but the past sales Verison did hasn't worked put so well, as they talk about here.
> 
> http://www.circleid.com/posts/20090917_verizon_throws_18_states_under_progress_train/


I don't believe there selling there FioS off in any area's it's just the copper wiring under that nice new FioS line there selling


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## TheRatPatrol (Oct 1, 2003)

oldschoolecw said:


> Verizon is selling all there land line copper wire up here in the North East there becoming very aggressive with FioS and DirecTV would give them that edge they need
> 
> Verizon Boss Hangs Up on Landline Phone Business
> http://bits.blogs.nytimes.com/2009/09/17/verizon-boss-hangs-up-on-landline-phone-business/?hpw


And maybe get a discount on our cell phone service too, and imagine all the things you could watch on your cell phone while away from home.


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## Robert L (Dec 13, 2005)

oldschoolecw said:


> I don't believe there selling there FioS off in any area's it's just the copper wiring under that nice new FioS line there selling


No, they are selling everything in those 14 states, and some in California. I did the the amount but forgot it right now, and not sure there is FIOS in the Ca. where they are selling.

At first it did sound like only copper but its not. Plus they have sold FIOS area's before. When I first heard I was hoping it was only copper, but found out its not. I don't know why they want to sell FIOS when it cost them so much. Sounds like they only want to be in highly populated areas I guess.


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## Kheldar (Sep 5, 2004)

oldschoolecw said:


> I don't believe there selling there FioS off in any area's it's just the copper wiring under that nice new FioS line there selling


Based on the press release, I don't believe that is accurate:


> *Details of the Acquired Operations*
> 
> The operations Frontier will acquire include all of Verizon's local wireline operating territories in Arizona, Idaho, Illinois, Indiana, Michigan, Nevada, North Carolina, Ohio, Oregon, South Carolina, Washington, West Virginia and Wisconsin. In addition, the transaction will include a small number of Verizon's exchanges in California, including those bordering Arizona, Nevada and Oregon.
> 
> As of year-end 2008, these operations served approximately 4.8 million local access lines; 2.2 million long-distance customers; 1.0 million high-speed data customers, including approximately 110,000 FiOS Internet customers; and 69,000 FiOS TV customers.


It doesn't specify that the transaction is copper-only. It states that it includes "all of Verizon's local wireline operating territories", which would include "approximately 110,000 FiOS Internet customers; and 69,000 FiOS TV customers". Sounds to me like 110,000 FIOS Internet customers and 69,000 FIOS TV customers (probably with a lot of overlap between those two groups) will become Frontier customers. Surely, though, Frontier would continue a similar service.

Verizon currently has service in 25 states & DC, and is completely backing out of 13 states (and reducing service areas in California). This leaves them with 12 states & DC.


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## davidjplatt (Sep 22, 2007)

AT&T was divested.

Bell Telphone of PA, NJ Bell, Diamond State Telphone Company Chesapeake and Potomac Telphone, C & P of Maryland, C & P of VA and C & P of West VA were combined and became Bell Atlantic (I know - I was a C & P customer for many, many years - my parents had C & P Telphone of Virginia when I was born).

NYNEX was formed 1/1/1984 as a result of the Bell System Divestiture. NYNEX was an RBOC made up of former AT&T subsidiaries NY Telephone Co. and New England Telephone. Bell Atlantic bought NYNEX on 08/14/97 (at the time, the second largest merger in American corporate history). On 06/30/2000, Bell Atlantic acquired GTE Communications and renamed the company to Verizon.

Verizon acquired MCI on 02/14/2005.

RBOCs SW Bell, Pacific Telesis and Ameritech became SBC. SBC bought AT & T and the resulting company was renamed AT & T. AT & T then bought BellSouth.

US West was the other RBOC and is was acquired by Qwest.


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## Jeremy W (Jun 19, 2006)

Verizon, please buy DirecTV! John Malone has never known how to run a TV provider.


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## mreposter (Jul 29, 2006)

Sooner or later the cable companies are going to start grumbling that FIOS and UVERSE are cherry-picking the rich neighborhoods and convince the FCC to step in. Owning Directv or Dish would alleviate the issue. 

On the otherhand, D*/E* both have a long term problem - more and more customers want one company for all their telecommunication needs. AT&T and Verizon can offer phone, cellphone, tv and internet all in one package and cable companies can offer three of the four. In 3-5 years both satellite companies could be facing large customer defections if they can't offer similar packages. Why would AT&T/Verizon buy them now when they'll ultimately be worth less in a few years?

So who needs who more?


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## Shades228 (Mar 18, 2008)

Buying DirecTV would be good for either company. It would allow them a complete solution all over and allow them to change the rollout process. Also they don't have to deal with regulations for people to get the service in areas they are not in at this time.


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## Shades228 (Mar 18, 2008)

Jeremy W said:


> Verizon, please buy DirecTV! John Malone has never known how to run a TV provider.


Be careful of what you ask for. VZN hasn't proved it can build a profitable business with TV either. They bled money hand over fist to get people to sign up and they paid higher prices than other companies to get a channel carried. Bright lights of new companies can fade fast once the shareholders want their money back.


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## Kheldar (Sep 5, 2004)

Shades228 said:


> Be careful of what you ask for. VZN hasn't proved it can build a profitable business with TV either. They bled money hand over fist to get people to sign up and they paid higher prices than other companies to get a channel carried. Bright lights of new companies can fade fast once the shareholders want their money back.


... which would be the perfect reason to buy an already-profitable, already-established service. Why build a service from the ground up when you can purchase a service that already has 18+ million customers?


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## Jeremy W (Jun 19, 2006)

Shades228 said:


> Be careful of what you ask for. VZN hasn't proved it can build a profitable business with TV either.


Verizon doesn't have to make DirecTV profitable, so I don't see why anyone should be worried about that. Looking at how they've managed FiOS, I'm impressed and I would love to see the same philosophy applied to DirecTV.


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## Shades228 (Mar 18, 2008)

Jeremy W said:


> Verizon doesn't have to make DirecTV profitable, so I don't see why anyone should be worried about that. Looking at how they've managed FiOS, I'm impressed and I would love to see the same philosophy applied to DirecTV.


They are not making money with FIOS TV. Show me a for profit company that has a business model that doesn't make a profit and I'll show you another car company..er I mean I'll show you a company that won't survive.


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## Jeremy W (Jun 19, 2006)

Shades228 said:


> They are not making money with FIOS TV. Show me a for profit company that has a business model that doesn't make a profit and I'll show you another car company..er I mean I'll show you a company that won't survive.


Running a profitable business and turning a profit with a new business are two *VERY* different things.


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## HRJustin (Mar 5, 2009)

I really hate verizon no matter what service it is. They are to expensive on wireless phone service and landline and everything else compared to other companies. I hate that verizon bought alltel it makes me sick to my stomach. Now new subscribers are forced to verizons prices. I hope that directv wont allow verizon to purchase them. If this does happen to be true I hope the FCC wont allow verizon to acquire directv. I just dispise the way that verizon does business. They dont care about the customer all they care about it getting the most money from each one as possible.


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## Kojo62 (Aug 9, 2007)

I'm a former Verizon management employee going back to when they were Bell Atlantic, and still have many friends who work there today. I don't get why anyone would see the prospect of DirecTV being bought by Verizon as an automatic positive.

Verizon is one of the LAST companies I'd ever want to see buying DirecTV. They're conservative, bureaucratic, and not very progressive. Innovation moves at a glacial pace inside their walls. Verizon thinks old-school because they were born from old bones (read the Ma Bell monopoly), always have, always will. It's in their DNA.

I don't see why Verizon would even want to own DirecTV, other than to bury it. DirecTV is a natural competitor to Verizon's FiOS TV service. If they bought DirecTV, it would probably be just to remove their competition by acquisition. I can easily see them buying it and just letting it wither and die while they concentrate on growing FiOS. I don't see a value-add to existing DirecTV customers.

Hopefully, if there's any truth to this rumor, the deal would be squashed by the Feds on antitrust grounds. I simply don't trust Verizon with DirecTV. It wouldn't be a good thing IMO.


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## Ken S (Feb 13, 2007)

Kojo62 said:


> I'm a former Verizon management employee going back to when they were Bell Atlantic, and still have many friends who work there today. I don't get why anyone would see the prospect of DirecTV being bought by Verizon as an automatic positive.
> 
> Verizon is one of the LAST companies I'd ever want to see buying DirecTV. They're conservative, bureaucratic, and not very progressive. Innovation moves at a glacial pace inside their walls. Verizon thinks old-school because they were born from old bones (read the Ma Bell monopoly), always have, always will. It's in their DNA.
> 
> ...


Funny, you should say they're conservative while they are engaging in a very aggressive fiber build-out...hardly old school. Now, whether it would be good for consumers is another question altogether...and it seems that hardly matters anymore. I'm not sure that a VZ/DTV merger would trigger anti-trust issues...doubtful they'd be the largest provider of TV content in any significant areas and they'd still have viable competition from cable and Dish in just about every market.


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## rebkell (Sep 9, 2006)

Ken S said:


> Funny, you should say they're conservative while they are engaging in a very aggressive fiber build-out...hardly old school. Now, whether it would be good for consumers is another question altogether...and it seems that hardly matters anymore. I'm not sure that a VZ/DTV merger would trigger anti-trust issues...doubtful they'd be the largest provider of TV content in any significant areas and they'd still have viable competition from cable and Dish in just about every market.


And didn't the court just throw out the 30% market share about comcast, the FCC was trying to enforce about subs(I'm sure that's not the correct terminology, but it was about Comcast having too much market share and the courts ruled in Comcast's favor)

I've about come to the conclusion that the FCC has no direction, they just randomly drift from here to there and don't really have any idea what they are doing half the time.


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## Glen_D (Oct 21, 2006)

It's kind of surprising to read some of the comments here about Verizon's lack of innovation and progressiveness, considering their FIOS service (not available in my area) is considered by many pundits to be a vastly superior product to AT&T's U-verse (which is available in my area), from a technological standpoint.

I can't speak for FIOS, but I don't see U-verse being expanded to cover outlying areas or rural areas for several years, if ever. Even in neighborhoods that have U-verse, there can be pockets in those neighborhoods where service is not available. 

The telcos could use a partnership with a satellite provider to provide quadruple-play to residents in those areas where their in-house television delivery service isn't available.


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## inkahauts (Nov 13, 2006)

rey_1178 said:


> i would love to see verizon purchase directv. i hate the changes this current ownership has made.


Can you please spell out what things the newest ownership has done to change anything that is happening at Directv? I can not think of anything.


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## inkahauts (Nov 13, 2006)

Shades228 said:


> They are not making money with FIOS TV. Show me a for profit company that has a business model that doesn't make a profit and I'll show you another car company..er I mean I'll show you a company that won't survive.


And they don;t plan on making money on FIOS for many years.. Thats what happens when you start a new business from scratch on such a large scale.. It took, what, a Decade for Directv to turn a profit, if not longer. It survived because it was backed by hughes.


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## paulh (Mar 17, 2003)

Glen_D said:


> It's kind of surprising to read some of the comments here about Verizon's lack of innovation and progressiveness, considering their FIOS service (not available in my area) is considered by many pundits to be a vastly superior product to AT&T's U-verse (which is available in my area), from a technological standpoint.
> 
> I can't speak for FIOS, but I don't see U-verse being expanded to cover outlying areas or rural areas for several years, if ever. Even in neighborhoods that have U-verse, there can be pockets in those neighborhoods where service is not available.
> 
> The telcos could use a partnership with a satellite provider to provide quadruple-play to residents in those areas where their in-house television delivery service isn't available.


The "conservative" comments are not suprising to me, I had a prof that had worked for GTE, and said he worked on a pay at the pump system and in-home networked communications terminals with small deployments (was that late 70's/early 80's? ), but corporate never cared about those, now commonplace, technologies. Confirming the "GTE way" I once moved from one GTE town to another. When I called GTE, they said they did not service the new town. I had to call town hall to confirm that GTE was the service provider..


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## cartrivision (Jul 25, 2007)

inkahauts said:


> And they don;t plan on making money on FIOS for many years.. Thats what happens when you start a new business from scratch on such a large scale.. It took, what, a Decade for Directv to turn a profit, if not longer. It survived because it was backed by hughes.


...and General Motors. GM bought all of Hughes (including what eventually became DirecTV) for $5 billion back in 1985.


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## jpl (Jul 9, 2006)

Ken S said:


> Look at what Dell just paid for Perot's company....if they believe they have to expand they will. AT&T and Verizon see a big risk from companies like Comcast...they all want to offer the "triple play".


The thing is, Verizon's been growing faster than any other TV service provider - this area has become FiOS country, despite the fact that Comcast has their HQ in Philly. I really don't think Verizon's worried about competition from the likes of Comcast.

In terms of purchasing power, that is a point - but again, they've grown to become literally one of the largest cable companies in the country. Yes, they're still small compared to the likes of DirecTV and Comcast, but they've quickly outpaced a bunch of the cable systems around the country.

Also, comparing the purchase by Dell is apples and oranges. You're talking two totally different industries. Dell was struggling financially... Verizon isn't. Dell is operating in an industry that's alot healthier, overall, than TV service. Yes, TV service has grown, but it's been disproportionate. It's mainly been directed at three companies - Verizon, AT&T and DirecTV. Many of the companies in the TV service industry have been struggling financially. I still think that, in this industry, at this point in time, DirecTV is too expensive to be the most prime buy-out target.


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## Paul Secic (Dec 16, 2003)

Movieman said:


> When I worked for AT&T the talk from the top was clear regarding IPTV. Although they were supposed to role it out very similar to FIOS and someone changed their minds. Also, my buddy that works for AT&T Corp told me months ago that they were looking at *alternatives* due to the financial scale back of U-Verse. Verizon on the other hand is doing great with FIOS. Sure they could use it for their footprint but again they are expanding FIOS much better than U-Verse is expanding. Dont mean Im right but its my thought being that I worked for these guys for many, many, years. Also, AT&T in Florida has been lobbying a lot of certain changes that deal with Directv services.
> 
> Correct. AT&T and BellSouth and SouthernBell for those of us in the South East. Verizon I think was BellAtlantic and did the change over after they started buying up smaller carriers like Primeco in Florida. This is going a little back in time and dont remember all the names.
> 
> Im not saying im right but I deal a lot with the telecom industry in my career and AT&T is making a lot of inquisitions. Verizon is not at least for now. We will see.


U-verse is real horrid.


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## Paul Secic (Dec 16, 2003)

davidjplatt said:


> AT&T was divested.
> 
> Bell Telphone of PA, NJ Bell, Diamond State Telphone Company Chesapeake and Potomac Telphone, C & P of Maryland, C & P of VA and C & P of West VA were combined and became Bell Atlantic (I know - I was a C & P customer for many, many years - my parents had C & P Telphone of Virginia when I was born).
> 
> ...


They should have kept AT&T intact. Now we second class phone system.


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## Paul Secic (Dec 16, 2003)

Glen_D said:


> It's kind of surprising to read some of the comments here about Verizon's lack of innovation and progressiveness, considering their FIOS service (not available in my area) is considered by many pundits to be a vastly superior product to AT&T's U-verse (which is available in my area), from a technological standpoint.
> 
> I can't speak for FIOS, but I don't see U-verse being expanded to cover outlying areas or rural areas for several years, if ever. Even in neighborhoods that have U-verse, there can be pockets in those neighborhoods where service is not available.
> 
> The telcos could use a partnership with a satellite provider to provide quadruple-play to residents in those areas where their in-house television delivery service isn't available.


AMEN!!!!!!!!!!!!


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## Ken S (Feb 13, 2007)

jpl said:


> The thing is, Verizon's been growing faster than any other TV service provider - this area has become FiOS country, despite the fact that Comcast has their HQ in Philly. I really don't think Verizon's worried about competition from the likes of Comcast.
> 
> In terms of purchasing power, that is a point - but again, they've grown to become literally one of the largest cable companies in the country. Yes, they're still small compared to the likes of DirecTV and Comcast, but they've quickly outpaced a bunch of the cable systems around the country.
> 
> Also, comparing the purchase by Dell is apples and oranges. You're talking two totally different industries. Dell was struggling financially... Verizon isn't. Dell is operating in an industry that's alot healthier, overall, than TV service. Yes, TV service has grown, but it's been disproportionate. It's mainly been directed at three companies - Verizon, AT&T and DirecTV. Many of the companies in the TV service industry have been struggling financially. I still think that, in this industry, at this point in time, DirecTV is too expensive to be the most prime buy-out target.


I used Dell's recent purchase as an example of a company believing they had to expand to continue to grow and paying a huge price to do so. If that's the belief at AT&T or Verizon they will make a purchase and may very well overpay. Neither AT&T or Verizon is focusing on TV...they want to be one of three connections to every residence in the US. (electricity and water/sewage being the other two). To do that they both have to expand their footprint greatly. Verizon and AT&T trail DirecTV, Dish, Comcast and Time Warner badly and they know that Comcast and Time Warner can also take away their phone/internet business.

You keep talking about DirecTV being too expensive...what's the price? It's not like their stock price has ballooned at all. If Malone wants out...it's not like he hasn't sold companies to phone companies before. What was the name of the company that he sold TCI to again?


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## RAD (Aug 5, 2002)

Paul Secic said:


> U-verse is real horrid.


Doh, you're on this site enough you couldn't figure that out from the post about U-Verse?


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## rey_1178 (Dec 12, 2007)

inkahauts said:


> Can you please spell out what things the newest ownership has done to change anything that is happening at Directv? I can not think of anything.


there are enough posts on this site lately that tells you something is not right with cust service and you can only blame ownership. take a look for yourself


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## jpl (Jul 9, 2006)

Ken S said:


> I used Dell's recent purchase as an example of a company believing they had to expand to continue to grow and paying a huge price to do so. If that's the belief at AT&T or Verizon they will make a purchase and may very well overpay. Neither AT&T or Verizon is focusing on TV...they want to be one of three connections to every residence in the US. (electricity and water/sewage being the other two). To do that they both have to expand their footprint greatly. Verizon and AT&T trail DirecTV, Dish, Comcast and Time Warner badly and they know that Comcast and Time Warner can also take away their phone/internet business.
> 
> You keep talking about DirecTV being too expensive...what's the price? It's not like their stock price has ballooned at all. If Malone wants out...it's not like he hasn't sold companies to phone companies before. What was the name of the company that he sold TCI to again?


Expensive is relative. My point is that with how the industry is fairing these days there are much cheaper targets. I'd be more incluned to believe a buy-out of Dish than DirecTV.

And you're wrong about Verizon not focusing on tv. They are. Their ceo just recently said that the landline phone business is dead - something we've all known. As have they - hence the divestiture to Frontier. He came right out and said that video (and HSI) is the future of the company. It's that very statement that's been fueling these rumors.


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## RAD (Aug 5, 2002)

I'm afraid that if AT&T got DirecTV that the purse stings will tighten up and they'll try to milk their infrastrusture as much as they can. IMHO forget a new sat being added after D12, new features will be few and far between. Look at their U-Verse product, throw together a Rube Goldberg solution that can't compete with cable, don't spend the dollars to do it right the first time to keep the stock holders happy so the exec's get their bonus at the end of the year. 

At least Verizon said we know running FTTP will cost a bunch of $'s up front but we're future proofing out network so we can provide tons of advance services due to tons of bandwidth being delivered to the home.


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## rey_1178 (Dec 12, 2007)

RAD said:


> I'm afraid that if AT&T got DirecTV that the purse stings will tighten up and they'll try to milk their infrastrusture as much as they can. IMHO forget a new sat being added after D12, new features will be few and far between. Look at their U-Verse product, throw together a Rube Goldberg solution that can't compete with cable, don't spend the dollars to do it right the first time to keep the stock holders happy so the exec's get their bonus at the end of the year.
> 
> At least Verizon said we know running FTTP will cost a bunch of $'s up front but we're future proofing out network so we can provide tons of advance services due to tons of bandwidth being delivered to the home.


:up::up::up:


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## Ken S (Feb 13, 2007)

jpl said:


> Expensive is relative. My point is that with how the industry is fairing these days there are much cheaper targets. I'd be more incluned to believe a buy-out of Dish than DirecTV.
> 
> And you're wrong about Verizon not focusing on tv. They are. Their ceo just recently said that the landline phone business is dead - something we've all known. As have they - hence the divestiture to Frontier. He came right out and said that video (and HSI) is the future of the company. It's that very statement that's been fueling these rumors.


What I meant is Verizon is focusing on the connection to the home...of course TV is a portion of that...more important though is the IP connection through which voice and content are going to be delivered. One of the companies may buy Dish...but that would really put the pressure on the other to buy DirecTV. Anyway, we'll just have to watch and see.


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## jpl (Jul 9, 2006)

Ken S said:


> What I meant is Verizon is focusing on the connection to the home...of course TV is a portion of that...more important though is the IP connection through which voice and content are going to be delivered. One of the companies may buy Dish...but that would really put the pressure on the other to buy DirecTV. Anyway, we'll just have to watch and see.


Totally agree - we'll have to wait and see.


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## VLaslow (Aug 16, 2006)

My experience with Verizon has been VERY mixed. They control their wireless business by ensuring that you have to buy every little thing on their cell phones (I had to get a femtocell just to receive important phone calls when their cell signal went south after two good solid years), the quality of their connections for wireless is usually the best, the DSL service I had from them was horrid. It was down more than it was up, and I've had to use their landline service even though they were the most expensive service available. During recent fires and electrical issues, their landline was unavailable even though I plugged in a standard tone phone. No dial tone at all. So much for reliability of service during emergencies.

I see them, as one person said, as glacial and old world; we own it and you will PAY for it; big time!

Fortunately, I now have a way out of their phone service via VOIP, I'm so far up the "hill" that FIOS won't be here for years so DirecTV remains my solution of choice, and Time Warner is running a pretty good internet service.

Actually, I don't trust any of the old line companies. I wish it were not so.


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## Jeremy W (Jun 19, 2006)

VLaslow said:


> I had to get a femtocell just to receive important phone calls when their cell signal went south after two good solid years


Yeah, but you did that because going with a company other than VZW was not a desirable option.


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## SamC (Jan 20, 2003)

Phone company history:

This deals with what today they call "POTS" or "plain old telephone service" which is all there was in 1982. AT&T owned 25 or so "local companies" which generally were named "(state or region name) Bell" or "(state or region name) Telephone" such as New York Telephone, Southern Bell or Illinois Bell. These were broken up into 7 regional companies. NYNEX (NY and New England), Bell Atlantic (mid-Atlantic states), Bell South (south) Southwestern Bell (lower midwest and southwest), Ameritech (great lakes states), US West (the vast "rest of the country"), and Pacific Telsis (California and the very small part of Nevada that AT&T served).

This dealt with about 80% of the country. The rest of the country was served by a plethora of other telephone companies, such as GTE, Contel, Centel, Alltel, and many others. There were also two companies named Bell that AT&T did not own. SNET, in CT, and Cincinnati Bell, in that metro region. AT&T was left with Western Electric, which made phones; Long Lines, which was the long distance company; and Bell Labs, which invented phones.

GTE then bought Contel and Centel and then merged with NYNEX and Bell Atlantic to from Verizon, which serves the Atlantic seaboard states from Virginia to Maine, plus the random mix of places, mostly smaller towns but not always, around the country that were GTE, etc.

Over the years, the rest of the Bell companies, including SNET, except US West, became merged and eventually bought the remnant AT&T, changing its name to AT&T.

Then Verizon sold, or is selling off, the POTS business in ME, VT, NH, and WV, and all of the random GTE, etc, places, except for its businesses in the more urban part of CA.

So today, in terms of POTS, you have Verizon in MA, RI, NY, PA, NJ, DE, DC, MD, VA and a part of CA. Then AT&T in FL, GA, SC, NC, KY, TN, AL, MS, LA, AR, OK, TX, KS, MO, OH, IN, IL, MI, WI, CT, CA, and NV. Then Qwest in all state in the Mountain time zone, plus IA, MN, NE, SD, ND, OR, and WA.

See a map here http://en.wikipedia.org/wiki/File:RBOC_map.png

This is the POTS for about 75% of the country. The rest are now independent companies such as Cincinnati Bell, Frontier, Century, Windstream, Fairpoint, Hawaiian, Embarq and three dozen others.

Now to DirecTV: The deal here, IMHO, is that the the phone companies workers are very unionized and have very restrictive work rules and such. And, they have a, perhaps very legitimate, view that Verizon is selling off its POTS business, and the workers and pension liabilities that go with it, to smaller companies who may not be there. For two examples, GTE served Hawaii, which became Verizon. Verizon sold it off to a private company, which went broke almost immediately. In my state, Verizon wants to leave, selling out to Frontier. Frontier is 1/1000th the size on Verizon in total capital and the CWA is going nuts about it.

Now how do you merge an company like DirecTV with something like Verizon or AT&T? I just do not see it. If you operated DirecTV on a union basis, it would go broke, and the CWA is never going to let either phone company own a union free business.


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## Upstream (Jul 4, 2006)

Ken S said:


> What I meant is Verizon is focusing on the connection to the home...of course TV is a portion of that...more important though is the IP connection through which voice and content are going to be delivered.


And that is why DirecTV is a poor fit for Verizon or AT&T.

The focus is on the connection to the home to deliver internet, video, etc.

DirecTV does not have a connection to the home.

The only advantage that DirecTV would offer Verizon is volume to help negotiate video carriage contracts. But that is a short-term benefit until Verizon expands their network. Smaller cable companies could also offer negotiation volume (to a lesser degree), but they offer the connectivity to provide internet.


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## Stuart Sweet (Jun 19, 2006)

I don't know if it's a good fit. This is what I do know: A lot of people put weight on who the majority stockholder is. They say, Murdoch did this, now Malone is doing that. DIRECTV is an independent company and while I am certainly not privy to every little bit of what goes on there, no one has ever said that any decision was made because Mr. Malone or Liberty Media dictated it. Quite the opposite, in fact: sometimes decisions are made that would seem to go against corporate synergy. 

If verizon buys DIRECTV, they could keep their competitors from bundling DIRECTV, they could bundle FIOS Internet with DIRECTV television for a great on-demand experience (like what I have now) or they could do nothing.


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## ivoaraujo (Aug 27, 2007)

What are the advantages and/or disadvantages of ATT or Verizon purchasing Directv?


I see it is already answered


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## dmurphy (Sep 28, 2006)

SamC said:


> Now how do you merge an company like DirecTV with something like Verizon or AT&T? I just do not see it. If you operated DirecTV on a union basis, it would go broke, and the CWA is never going to let either phone company own a union free business.


Look up "Cellco Partnership d/b/a Verizon Wireless" and tell me what you think then.

With the exception of about 50 employees in New York - that came out of the old NYNEX - Verizon Wireless is completely union-free.

... for those unfamiliar with the Verizon family; Verizon Wireless is a completely separate entity from Verizon Communications. Verizon Communications owns 55% of Verizon Wireless (Vodafone owns the other 45%), but they are operated as completely separate entities.


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## hdtvfan0001 (Jul 28, 2004)

Based on some information that was shared from a senior Verizon contact..this is pretty hush hugh inside their organization.

The monetary considerations of any such deal - if they ever are going to happen at all - are extremely significant....making the chances 50/50 at best.

While these rumors are floating around for Verizon and AT&T...these are investor rumors, not business operational rumors....meaning they may make stockholder sense, but not necessarily business sense.

Stay tuned.


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## VLaslow (Aug 16, 2006)

Jeremy W said:


> Yeah, but you did that because going with a company other than VZW was not a desirable option.


Exactly! But, that didn't make me happy, either.


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## Upstream (Jul 4, 2006)

Stuart Sweet said:


> they could keep their competitors from bundling DIRECTV, they could bundle FIOS Internet with DIRECTV television for a great on-demand experience


If Verizon is hooked up to provide Fios internet to a home, what is the advantage of offering DirecTV? They could just provide Fios television over the same connection that provides Fios internet.


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## Doug Brott (Jul 12, 2006)

oldschoolecw said:


> There has been a drop in quality with this new ownership of DirecTV and being in Verizon country I also would love to see them purchase DirecTV.


:scratchin .. how do you define "drop in quality?" I think the product itself is better than ever.


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## Ken S (Feb 13, 2007)

hdtvfan0001 said:


> Based on some information that was shared from a senior Verizon contact..this is pretty hush hugh inside their organization.


Your senior contact better be very careful as spreading any kind of inside information could be a very serious violation of law. A smart senior Verizon contact would know not to do that.


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## jpl (Jul 9, 2006)

Ken S said:


> Your senior contact better be very careful as spreading any kind of inside information could be a very serious violation of law. A smart senior Verizon contact would know not to do that.


While spreading inside information can (and should) get you fired, unless you benefit directly from spreading said rumors, I don't believe there's a violation of the law. For example, let's say a company is about to disclose some news that will absolutely kill the stock. I'm an insider and I don't want to get hammered with that, so I want to off-load my stock. I put out some rumor that makes the company look alot different than it actually is, financially speaking. The stock goes up... I sell... take a nice profit... and the stock then tanks when the real news hits. That's an example of insider trading.

Unless you're releasing information that you or your family will directly benefit from, as a result of that clandestine release of info, you're really not engaging in insider trading. Not saying that it's ok to do that... it's not... just that it's probably not illegal.


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## Steve (Aug 22, 2006)

Ken S said:


> Your senior contact better be very careful as spreading any kind of inside information could be a very serious violation of law. A smart senior Verizon contact would know not to do that.


Depending on how high up the person is, may not be illegal, but still could be grounds for losing one's job, depending on corporate policy.

EDIT: Didn't see *jpl's* post. Sounds like we agree.


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## RCY (Nov 17, 2005)

I hope it stays a rumor. To me, less competition is bad.


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## wingrider01 (Sep 9, 2005)

Wonder what the FCC will say about this

If VVerizon gets Directv, Directv will lose a longtime customer here would rather stick myself in sensitive spots with a ice pick they deal with those jerks for anything


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## jpl (Jul 9, 2006)

wingrider01 said:


> Wonder what the FCC will say about this
> 
> If VVerizon gets Directv, Directv will lose a longtime customer here would rather stick myself in sensitive spots with a ice pick they deal with those jerks for anything


The FCC? Nothing. The FTC may have something to say about it, though. Given the size of DirecTV and Verizon, it wouldn't surprise me to have the FTC require some divestiture of some piece of either company before allowing any such deal to go through. Although, really, you're not creating a monopoly, so such a deal would likely be approved... assuming it happens... which I still contend that it won't.


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## bb37 (Dec 27, 2007)

SamC said:


> Phone company history...


Those ignorant of history are doomed to repeat it.  I find it ironic that what seemed like such a great idea in 1982, breaking up AT&T, is now not a good idea. Granted, the marketplace has changed dramatically and we have consumer-based communications services that few even dreamed of 25 years ago.



SamC said:


> GTE then bought Contel and Centel and then merged with NYNEX and Bell Atlantic to from Verizon, which serves the Atlantic seaboard states from Virginia to Maine, plus the random mix of places, mostly smaller towns but not always, around the country that were GTE, etc.


It's interesting that GTE, and now Verizon, is the telephone company in Fort Wayne, Logansport, Lafayette, and Terre Haute, Indiana. It's as if someone drew a line down the Wabash River and said "we'll serve these towns even though they are in the middle of Indiana Bell/Ameritech territory."



SamC said:


> This is the POTS for about 75% of the country. The rest are now independent companies such as Cincinnati Bell, Frontier, Century, Windstream, Fairpoint, Hawaiian, Embarq and three dozen others.


Seems like I see Sprint serving lots of small towns in northern Indiana and Ohio. How did they end up with these isolated markets? Who did Sprint buy to get them?



SamC said:


> The deal here, IMHO, is that the the phone companies workers are very unionized and have very restrictive work rules and such.


While most of the former Indiana Bell, now AT&T, is CWA, there is a pocket in northwestern Indiana that is, I believe, IBEW. Doing work inside a CO in that area is very different from the rest of the state.


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## jpl (Jul 9, 2006)

bb37 said:


> Those ignorant of history are doomed to repeat it.  I find it ironic that what seemed like such a great idea in 1982, breaking up AT&T, is now not a good idea. Granted, the marketplace has changed dramatically and we have consumer-based communications services that few even dreamed of 25 years ago.
> 
> It's interesting that GTE, and now Verizon, is the telephone company in Fort Wayne, Logansport, Lafayette, and Terre Haute, Indiana. It's as if someone drew a line down the Wabash River and said "we'll serve these towns even though they are in the middle of Indiana Bell/Ameritech territory."
> 
> ...


Some of the geography listed in that post is wrong. For example, FL and TX are both big Verizon territories too - yeah, AT&T is there as well, but those markets are split. And they're currently also in IN, WA, and OR - three markets that include FiOS, which are being divested to Frontier.

I do have one nit with the notion that Ma Bell is reforming like the T1000 in Terminator 2. Not only is there a wide diversity of communication media that didn't exist in 1982, the market-place has changed dramatically for these companies. Calling Verizon 'the phone company' makes as much sense as calling Comcast 'the cable company.' Yeah, those are their legacy businesses, but the business models have dramatically changed. For example, Verizon is divesting a huge chunk of its legacy system - between their sale to Fairpoint and now to Frontier. They're also looking to move away from traditional land-line phone service. That's not what they're gearing up for anymore. They're quickly moving away from that market.

Yes, the phone companies have moved into new areas, but so have other companies - Comcast adds voice customers at an impressive clip, e.g. The business models are changing. No one company will have monopoly status over telecommunications like AT&T used to have. It just won't happen. Even if Verizon bought up all the former baby bells, and created a new Ma Bell, they would get slammed with competition from other sources.


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## Ken S (Feb 13, 2007)

jpl said:


> While spreading inside information can (and should) get you fired, unless you benefit directly from spreading said rumors, I don't believe there's a violation of the law. For example, let's say a company is about to disclose some news that will absolutely kill the stock. I'm an insider and I don't want to get hammered with that, so I want to off-load my stock. I put out some rumor that makes the company look alot different than it actually is, financially speaking. The stock goes up... I sell... take a nice profit... and the stock then tanks when the real news hits. That's an example of insider trading.
> 
> Unless you're releasing information that you or your family will directly benefit from, as a result of that clandestine release of info, you're really not engaging in insider trading. Not saying that it's ok to do that... it's not... just that it's probably not illegal.


I didn't say there was insider trading. There are several other regulations dealing with the improper disclosure of information that don't require the person making the disclosure to profit directly. This is not the place for that type of discussion. I would suggest, however, that it is unlikely that information on a forthcoming transaction of this nature would be given out by anyone that really is involved at an executive level and then posted on a public forum. I would hope it's just baseless rumor.


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## jpl (Jul 9, 2006)

Ken S said:


> I didn't say there was insider trading. There are other regulations dealing with the disclosure of information.


Legal trouble? No... you can't. You or your family/friends have to benefit from the transaction for you to be in trouble with the law. Disclosing some piece of information that's held close to the vest may get you fired, but you're not violating the law with doing that. At least not from a criminal perspective. I guess you can be sued - if you sign a non-disclosure agreement about something and you open your mouth, you're now in violation of your contract, which means that your employer can sue you in court, but that's not the same as someone going to jail.

That being said, there are laws on the books governing 'export' of technical information, and I guess such a disclosure COULD be construed as such an export. But in this case we're talking strictly about a business transaction - the purchase of one company by another.


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## Doug Brott (Jul 12, 2006)

Let's just leave this "disclosure" as a bad idea and perhaps move back to the discussion about the rumor .. Thanks all.


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## SamC (Jan 20, 2003)

> Seems like I see Sprint serving lots of small towns in northern Indiana and Ohio. How did they end up with these isolated markets? Who did Sprint buy to get them?


Sprint traces it history back to two companies. One was United Telephone, which was another of those "non-Bell" telephone companies that had random territories here and there across the country. The other was Sprint, which was originally "US SPrint" which provided long distance competition to AT&T prior to the Bell breakup using the infastructure of the Southern Pacific and other railroads (which is where the SP came from).

After a complex series of buyouts and breakups, Sprint-Nextel sold off its POTS business to Embarq. If you see Sprint branded POTS, its just some signage that Embarq has not replaced yet.



> Some of the geography listed in that post is wrong. For example, FL and TX are both big Verizon territories too - yeah, AT&T is there as well, but those markets are split.


Well, no. Yes, there are no mainland states, except Delaware, where the original AT&T owned every single exchange. The exchanges that AT&T did not own passed around, and many ended up with GTE, and then Verizon, and thus are being spun off to Frontier, or with United Telephone, and thus are now Embarq, or others. These do include significant parts of many states, however FL's incumbent Bell company was Southern Bell, which became BellSouth, which is now AT&T and Texas was Southwestern Bell, which became SBC and thus also AT&T.

While it is a common perception that AT&T (the original) owned all the big cities, there were lots of reasonabably sized towns that were non-Bell.


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## fl panthers (Sep 19, 2007)

on a side note about verizon.a few years back when nextels push to talk was expireing and verizon was pushing for that market they agreed and opened kiosk's in home depot right by the front door first endcap.they were not there long,maybe a month or two because they never paid the rent and one morning it came down(from corperate hd) to roll their kiosk out back and if they don't pick it up by monday destroy it and dipose of it.My two cents about verizon,they are a poor business partner and probably run that way unless they have the better deal.


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## wolfman730 (Sep 10, 2006)

http://www.fool.com/investing/general/2009/09/29/why-verizon-wont-buy-directv.aspx


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## jpl (Jul 9, 2006)

wolfman730 said:


> http://www.fool.com/investing/general/2009/09/29/why-verizon-wont-buy-directv.aspx


Holy cow... not only is that a great article... it actually encapsulates everything I've said in my other posts as to why I think the rumor is nonsense. The cost for DirecTV is too high... FiOS is not only rolling out strongly, but it's still costing Verizon alot of money to roll out, and they're focus has been to pull in a bit. Meaning they've slowed down the roll-outs in some more rural markets and are focusing alot more heavily in heavy-population areas - pushing for agreements with cities and surrounding suburbs, and ditching their more rural systems. They've been focusing, in other words, on increasing penetration rate... and per the article, it's been paying off. I also mentioned that, especially given the state of the economy, there are cheaper targets out there if their goal is simply to expand their TV empire.

And buying DirecTV would be nothing more than them expanding that empire. It really doesn't fit in with their core strategy for FiOS - it's an addition that would allow them to get into markets that they currently don't serve. Which means that buying some alternate service is just meant as a way to expand purchasing power. If that's the case, there are MUCH cheaper ways to do that. I can see paying to buy DirecTV if it fit in with their long-term strategy for getting into video. But it doesn't. The deal simply makes no sense to me.


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## gully_foyle (Jan 18, 2007)

It has never made sense that companies who exist solely because they have a monopoly on wires would be interested in a company that exists to bypass those wires. At least as far as synergy is concerned. AT&T or Verizon's main interest would be to cripple their most dangerous competitor.

I really cannot see this passing antitrust muster.


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## jpl (Jul 9, 2006)

I don't think it's an anti-trust issue, to be honest. There would be no monopoly created from such a deal. This doesn't make sense to me because the numbers don't add up. Think of it this way - the original articl (in the first post) talked about Verizon doing this to increase their TV footprint so they can get better carriage deals for their TV channels. Yes, they would save some money on their carriage deals... and yes, they would have revenue from their DirecTV subscribers... but such a deal would cost, what? $30Billion? $40Billion? What's the break-even point on that? Five years? Ten?

So... they're going to go $40Billion into hock so they can save a couple dollars on their carriage agreements? I just don't think so. Plus FiOS is still costing them alot of money. Take that $40Billion to buy DirecTV and FiOS suffers. FiOS is so expensive because it IS their strategic vision - where they want to go. Buying up another TV provider (whether DBS or cable) doesn't fit into that vision at all. Why would you sacrifice investment in your strategic plan in buying up something that doesn't fit into it? It would just be a naked move for market expansion, in a way that doesn't fall in line with your vision for the company.

In short, it's a very short-sighted move. And one thing that impresses me about Verizon's investment in FiOS is that it's anything but short-sighted. They're spending gobs of money to do FiOS right. I mean if they wanted to go the short-sighted route they could have just emulated AT&T with their roll-out of U-Verse.

If buying up a DBS provider DID fit into their long-range plan for getting into video, then I would say absolutely... buying up DirecTV makes sense. But it doesn't fit. It would just be a move to expand their TV empire. And if you're going to do that... then why DirecTV? There are MUCH cheaper ways to go about that - Dish is hard up for cash (no offense to the Dish subscribers out there) - they would make a much nicer buy-out target for Verizon.


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## Ken S (Feb 13, 2007)

jpl said:


> I don't think it's an anti-trust issue, to be honest. There would be no monopoly created from such a deal. This doesn't make sense to me because the numbers don't add up. Think of it this way - the original articl (in the first post) talked about Verizon doing this to increase their TV footprint so they can get better carriage deals for their TV channels. Yes, they would save some money on their carriage deals... and yes, they would have revenue from their DirecTV subscribers... but such a deal would cost, what? $30Billion? $40Billion? What's the break-even point on that? Five years? Ten?
> 
> So... they're going to go $40Billion into hock so they can save a couple dollars on their carriage agreements? I just don't think so. Plus FiOS is still costing them alot of money. Take that $40Billion to buy DirecTV and FiOS suffers. FiOS is so expensive because it IS their strategic vision - where they want to go. Buying up another TV provider (whether DBS or cable) doesn't fit into that vision at all. Why would you sacrifice investment in your strategic plan in buying up something that doesn't fit into it? It would just be a naked move for market expansion, in a way that doesn't fall in line with your vision for the company.
> 
> ...


I believe that DirecTV makes more sense as a purchase for AT&T. Verizon though would be forced to do something as the FIOS rollout may take longer than they have time for competitively.


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## jpl (Jul 9, 2006)

Ken S said:


> I believe that DirecTV makes more sense as a purchase for AT&T. Verizon though would be forced to do something as the FIOS rollout may take longer than they have time for competitively.


I'll agree with that. IF AT&T makes a move on DirecTV, then Verizon would be compelled to do something. I don't think this makes sense for AT&T either, though. Again, U-Verse is exceeding expectations on their roll-out. They should save the money they would be spending on buying another company and instead work on migrating their architecture to FTTP.


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## breevesdc (Aug 14, 2007)

I have mixed feelings about this if it happens. I plan on switching from RCN to FiOS for phone/internet when it is available in DC in a few months. But I know several people that have FiOS in Northern Virginia and they tell me that their customer service is HORRIBLE. While I can see the advantages to dealing with one company for all of my communication/TV needs (I am a Verizon Wireless subscriber), I'm not sure I want them touching my DirecTV service.

Brian


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## Scott in FL (Mar 18, 2008)

breevesdc said:


> I have mixed feelings about this if it happens. I plan on switching from RCN to FiOS for phone/internet when it is available in DC in a few months. But I know several people that have FiOS in Northern Virginia and they tell me that their customer service is HORRIBLE. While I can see the advantages to dealing with one company for all of my communication/TV needs (I am a Verizon Wireless subscriber), I'm not sure I want them touching my DirecTV service.
> 
> Brian


Agreed!!! After terminating my Verizon high speed internet service last month, I will never deal with them again. All due to HORRIBLE customer service.


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## pouterson (Jul 28, 2007)

jpl said:


> While spreading inside information can (and should) get you fired, unless you benefit directly from spreading said rumors, I don't believe there's a violation of the law. For example, let's say a company is about to disclose some news that will absolutely kill the stock. I'm an insider and I don't want to get hammered with that, so I want to off-load my stock. I put out some rumor that makes the company look alot different than it actually is, financially speaking. The stock goes up... I sell... take a nice profit... and the stock then tanks when the real news hits. That's an example of insider trading.
> 
> Unless you're releasing information that you or your family will directly benefit from, as a result of that clandestine release of info, you're really not engaging in insider trading. Not saying that it's ok to do that... it's not... just that it's probably not illegal.


You need to read up on your Insider Trading law. Knowingly releasing any "inside information" to anyone, including to a complete stranger, is violation of the law. You could be speaking to someone in an elevator about something you know and if they go out and act on that information, that's a violation of the law. Even if they don't benefit, that's a violation of the law.

My employer goes to extraordinary lengths to make sure the employees fully understand inside trader practices. They use an example similar to yours as a test question for us. The correct answer is that it does violate US insider trading laws. :nono:


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## dreadlk (Sep 18, 2007)

You can bet on one thing, if the rumor has started then that means that D* has become a ripe buy out target and most likely it will get sold in the next year or two.

This would be what the third or fourth time that D* has been sold!! I was once told that D* looks good on the books as far as cash flow but there long term problems such as satellite upgrades and receiver changes etc have always made them a bad long term investment. Not sure how true that is but I know they do spend a lot of cash to keep the system running.


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## dreadlk (Sep 18, 2007)

pouterson said:


> You need to read up on your Insider Trading law. Knowingly releasing any "inside information" to anyone, including to a complete stranger, is violation of the law. You could be speaking to someone in an elevator about something you know and if they go out and act on that information, that's a violation of the law. Even if they don't benefit, that's a violation of the law.


Can you show us one case ever where someone was succesfuly prosecuted for doing this?


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## Drew2k (Aug 16, 2006)

Laws can exist that are not enforced or for which no one has ever been prosecuted, but they are still laws.


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## Jeremy W (Jun 19, 2006)

dreadlk said:


> You can bet on one thing, if the rumor has started then that means that D* has become a ripe buy out target and most likely it will get sold in the next year or two.


Rumors of DirecTV being sold to Verizon/AT&T have been floating around for quite a while now, possibly over a year.


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## jpl (Jul 9, 2006)

dreadlk said:


> You can bet on one thing, if the rumor has started then that means that D* has become a ripe buy out target and most likely it will get sold in the next year or two.


I don't think that's true at all. I think the notion that Verizon has interest in DirecTV came from Verizon's CEO's statements about video being the future of the company. I really think that's what fed this particular fire. So, some rumor-meisters looked around and said 'aha! Verizon already has a deal with DirecTV! They must be ready to buy them.' I think the AT&T rumor came from the deal that happened last year when AT&T went from having a deal with Dish to having a deal with DirecTV. And of course you have to add to that the overwhelming success of DirecTV - they've done remarkably well at a time when others in their inudstry are foundering.

But that's the thing - that's what makes DirecTV LESS of an attractive target, in my opinion. Relative to the rest of the industry, all that success makes them expensive. And even though both Verizon and AT&T are both very profitable, it doesn't mean that they have the cash for this type of deal at this time. Both have heavily invested in their own systems, and both are feeling a bit of a pinch thanks to the economy. Again, I go back to the fact that IF either Verizon or AT&T wanted to make a big spash in upping their TV footprint, there are cheaper targets out there. Dish is a much better buy-out target than DirecTV is at this point. They have a huge subscriber base, but are strapped for cash. So, if I'm Verizon and I want to seriously up my TV footprint, I could pay a premium for DirecTV and get 18 million new subscribers... or I could pay a fraction of that for Dish and get almost as many (13 million).

Companies that are overwhelmingly successful are rarely buy-out targets - especially in a soft economy. For example, at one time Apple was seen as a prime buy-out target. This was when Jobs was out of the picture, and they seemed to have lost their way. Their stock was in the toilet and they were getting their heads pounded in. Then Jobs came back, and they introduced the iMac... followed by the iPod... the iPhone... and all the other suite of products that have put them seriously back in the black. No one is talking about them being bought out anymore.


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## bluemoon737 (Feb 21, 2007)

oldschoolecw said:


> Verizon is selling all there land line copper wire up here in the North East there becoming very aggressive with FioS and DirecTV would give them that edge they need
> 
> Verizon Boss Hangs Up on Landline Phone Business
> http://bits.blogs.nytimes.com/2009/09/17/verizon-boss-hangs-up-on-landline-phone-business/?hpw


Of course they gave up all their FiOS footprint in northern NE to FairPoint (what a deal for the consumer THAT has been...tongue firmly planted in cheek).

I just moved here and my first Fairpoint bill was $300+ for FiOS internet only...of course I called them and their answer was.."what do you think your bill should be?" Geez...talk about clueless. They said their billing reps would contact me with my actual bill...couple of weeks go by and no call so I call back. Rep looks at the notes and says that someone should have contacted me and she would send another request to billing (can't talk directly to their billing dept). Finally get a call two days before the bill is due with my correct bill amount. No wonder all three northern NE state utilities commissions are investigating Fairpoint after the assumption of FiOS and phone service from Verizon. Don't know if Verizon was forced or just gave up in these states but I doubt this sort of billing problem would have happened with Verizon. If they (Verizon) were somehow forced to give up the footprint then this would be a way for them to get back in the market.


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## gregjones (Sep 20, 2007)

Remember, market analysts are considered successful if 10% of their statements (guesses) come true. These are the same folks that often characterize Google Voice as VOIP when it is a call forwarding and text-message forwarding service. They are shocked when people don't rush out to buy $400+ Kindle DX devices to read failing newspapers. They got almost every aspect of the Sirium/XM merger wrong.

Most have no expertise whatsoever. Few have decent sources. There are some good market analysts out there, but they tend to say a lot less and be right much more frequently.


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## dreadlk (Sep 18, 2007)

jpl said:


> I don't think that's true at all. I think the notion that Verizon has interest in DirecTV came from Verizon's CEO's statements about video being the future of the company. I really think that's what fed this particular fire. So, some rumor-meisters looked around and said 'aha! Verizon already has a deal with DirecTV! They must be ready to buy them.' I think the AT&T rumor came from the deal that happened last year when AT&T went from having a deal with Dish to having a deal with DirecTV. And of course you have to add to that the overwhelming success of DirecTV - they've done remarkably well at a time when others in their inudstry are foundering.
> 
> But that's the thing - that's what makes DirecTV LESS of an attractive target, in my opinion. Relative to the rest of the industry, all that success makes them expensive. And even though both Verizon and AT&T are both very profitable, it doesn't mean that they have the cash for this type of deal at this time. Both have heavily invested in their own systems, and both are feeling a bit of a pinch thanks to the economy. Again, I go back to the fact that IF either Verizon or AT&T wanted to make a big spash in upping their TV footprint, there are cheaper targets out there. Dish is a much better buy-out target than DirecTV is at this point. They have a huge subscriber base, but are strapped for cash. So, if I'm Verizon and I want to seriously up my TV footprint, I could pay a premium for DirecTV and get 18 million new subscribers... or I could pay a fraction of that for Dish and get almost as many (13 million).
> 
> Companies that are overwhelmingly successful are rarely buy-out targets - especially in a soft economy. For example, at one time Apple was seen as a prime buy-out target. This was when Jobs was out of the picture, and they seemed to have lost their way. Their stock was in the toilet and they were getting their heads pounded in. Then Jobs came back, and they introduced the iMac... followed by the iPod... the iPhone... and all the other suite of products that have put them seriously back in the black. No one is talking about them being bought out anymore.


I will just say IMHO that I think D* is not in nearly as good a financial situation as some of you think. Yes they have gotten new customers and yes they have an increased revenue flow but that is to be expected since they just spent a bundle of cash upgrading their Satellite fleet and developing new receivers and negotiating numerous contracts for new HD channels.

After all this expense if they have not seen an increase in sales and income they would have been filing for bankruptcy by now. The big question is are they seeing the kind of increases they hoped for and now that Echostar and the rest have surpassed them in HD while still maintaing a HD DVR and HD receivers that have a fairly good reputation what will be the impact of that for D* over the next 24 months. I suspect Charlie has gotten his usual sloppily built systems for 1/3 the price that D* spent and he will ultimately float to the Top, Charlie always floats to the Top, it's in his nature


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## dreadlk (Sep 18, 2007)

Drew2k said:


> Laws can exist that are not enforced or for which no one has ever been prosecuted, but they are still laws.


They are useless laws because they really can't be enforced. Take the DMCA and prosecuting of people for downloading music. They tried for a time and then they realized that the public would have forced the politicians and courts to tear down the laws so they backed off. Yes they remain on the books but who is going to drag a 12 year old girl in for having 1000 songs on her PC!

If anything the prosecutions that they did make at the start just spurred out a whole bunch of press reports that educated people who normally would have never know how to pirate stuff on just exactly how to do it and increased piracy while making the record industry look like crooks
IOW it made things worst and just opened up the door for Itunes etc which are rapidly cutting out the record industry (The Middleman) and dealing with artist directly.


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## dreadlk (Sep 18, 2007)

Jeremy W said:


> Rumors of DirecTV being sold to Verizon/AT&T have been floating around for quite a while now, possibly over a year.


Yes I know, and thats why i think that its a real possibility to happen now.


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## xylo (Dec 23, 2008)

http ://www.reuters.com/article/cyclicalConsumerGoodsSector/idUSN1214454620091012

Bold emphasis mine.



> Talks between Comcast and GE continue, and it is unlikely the two sides will reach a deal in the next three-to-four weeks, a second source said.
> 
> Rupert Murdoch's News Corp (NWSA.O) and *John Malone's Liberty Media Corp (LINTA.O) are also interested in NBC Universal, though neither has approached GE so far*, CNBC reported, citing sources.
> 
> ...


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