AT&T could offload a stake in DIRECTV at a significant loss on the $67 billion it paid for the satellite television business in 2015. The New York Post described the process, being run by Goldman Sachs, as “shaping up to be a fire sale”. Opening bids from buyout firms reportedly came in at around 3.5 times earnings, implying a valuation at around $15.75 billion. It is understood that rival Dish Network did not submit a bid. A merger of the satellite television businesses may seem inevitable, but it would face scrutiny under competition regulation.

Acquiring DIRECTV for $67 billion in 2015, including $18 billion in assumed debt, gave AT&T rights to a range of programming. In 2016 it doubled down and acquired Time Warner for $109 billion. The company now has long-term debt of over $153 billion.

Many investors have been unpersuaded by the AT&T strategy. From a share price of over $40 in mid-2016, it was down to below $30 in mid-2020.

By early 2017, AT&T had 25.03 million premium television subscribers, including about 19.22 million DIRECTV subscribers, to which it could market its other services.

Since then, AT&T has lost 7.3 million premium television subscribers, or 29% of its base, although it does not report how many of those are satellite customers.

In the first half of 2020, AT&T lost 1.78 million premium television subscribers, according to the informitv Multiscreen Index.

AT&T has been unenthusiastic about its satellite television business, considering that online video will be the future, while connectivity is really the cash cow.

Although many may attribute the decline in traditional television subscribes to so-called cord-cutting, AT&T has apparently encouraged the process by reducing promotional offers and imposing price increases, focussing on higher value subscribers rather than retaining others at all costs.