While programming has been cited as a motivator for the AT&T-DirectTV deal, the biggest benefits may lie in wireless and Latin America, says Ashley J. Swartz, founder and CEO of Furious Minds, in a commentary for Beet.TV. “What does this deal have that Comcast-Time Warner lacks? That’s wireless,” she says. “Think about the opportunity using DirecTV’s negotiating power to get national over-the-top rights and deploy a TV Everywhere authenticated platform…that’s a great incremental lift in revenue if you start to drive data consumption on a highly profitable product, like throughput on wireless networks, that is an incredible profit center that can drive [revenue] across the wireless subscriber base.”
The other key to the deal is Latin America, which is a sleeping giant, Swartz says. Currently, DirecTV counts about 18 million subscribers in Latin America, and the economic growth rates in that region are about three to five times that of the United States. Add in the 42% of the population having access to broadband, and there is tremendous opportunity to boost broadband penetration in that region, she says.
For more insight into the potential merger, and the driving factors, check out this commentary.