AT&T, the nations largest telephone company, announced several interesting points which will affect the future of satellite TV players DIRECTV and Dish Network . In first announcing and increase in their dividend payout, as well as an increased stock buyback plan, AT&T showed that it is flush with cash. But what to do will all that money?
Satellite operator Dish Network has been the supposed target of an AT&T takeover, but speculation has cooled in recent weeks as the stock of Dish Network has fallen. Meanwhile, there have not been any clear signals from Echostar CEO Charlie Ergen, who holds all the cards in consummating the potential marriage.
So today AT&T put on its poker face and pushed all in with Dish Network. The company announced a dramatic expansion in delivering television over phone lines, it service known as U-verse TV. While AT&T U-verse only had about 125,000 at the end of September, company officials say they are connecting over 10,000 customers per week, and expect to have 1 million subscribers by the end of 2008. Officials also said they intend to reach over 30 million homes by 2010, expanding from their prior goal of 17 reaching 17 million homes by year end 2008.
So AT&T has hedged it bet. Either time for Dish Network to climb aboard, or they are more than willing to go it alone. At the same time, AT&T announced that they are cutting ties with DirecTV. The two were partners in a resale agreement, but AT&T will stop sales by the end of the first quarter 2008.
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