I personally am not buying into the demise of sat tv. I will admit I think it will get to the point of only being able to support a single company though. But how to get to one company is the question. A merger/buyout of one over the other seems problematic because the only similarity between the two is they use satellites, otherwise all the consumer end equipment is quite different.
I also am not buying into the pie in the sky of how much 5G and the launching of a bazillion satellites for internet service is going to happen anytime real soon.
Just call me a curmudgeon or Luddite if it makes you feel better!
Ha, not calling you a luddite. However, you say you don't buy into the demise of satellite TV but then basically admit that, yes, it's in long-term decline (at least mild decline) which will necessitate that the industry consolidates from two major national players to one.
To be honest, I think there's quite a bit of uncertainty over how steep/fast the decline of DBS TV will be. And I would agree with you that, at least in the next several years, it's not going away. But I think we could both agree that it's definitely not a
growth industry.
When I get into these debates/discussions with longtime satellite TV fans, it seems like they often defend DBS as a TV distribution technology. And I admit that there's nothing wrong with DBS technology, per se. Sure, it suffers from a little rain fade but it has an ability to reach people nationwide, something that other forms of TV cannot do. (And it can deliver lots of HD channels with great picture quality too!) The problem with DBS is mainly due to the changing nature of the TV business. The business of cobbling together packages of other companies' cable channels and then reselling them at a low margin to subscribers is fading as consumers increasingly turn to direct-to-consumer streaming services. That shift doesn't hurt cable TV operators because they're also broadband operators. (In fact, it may actually HELP cable operators because their broadband profit margins are way higher than their TV profit margins.) But it hurts DISH and DirecTV because, well, they can't deliver broadband through their dishes.
I do believe that DBS TV will continue to have a captive audience of consumers who have no other choice for pay TV. But that group of consumers will only ever shrink. How quickly, I don't know. But any logical interpretation of the facts and trends in front of us tells us that DBS TV is a business in long-term decline.
That, I believe, is what makes DirecTV ill-suited to ownership by AT&T, at least from the perspective of Wall Street. The rest of AT&T is at least plausibly positioned for continued future growth. But everyone knows that's NOT the case for DirecTV. Which is why it might make sense for it to trade as a separate stock, perhaps a stock that is a joint DirecTV/DISH operator.
