Report: AT&T spoke with DirecTV about merger

AT&T has reportedly approached DirectTV about possibly buying the satellite giant, in a move that could lead to further consolidation in the TV market.

The Wall Street Journal reported early on Thursday that the discussion happened after Comcast announced its proposed $45 billion deal with Time Warner Cable, an acquisition that would combine the top two cable providers in the country.

{mosads}If it acquired DirecTV and its 20 million satellite TV customers, AT&T would be within punching distance of the combined Comcast-Time Warner Cable giant with nearly 26 million subscribers. Comcast would have about 30 million subscribers if regulators approved the merger.

Any deal between AT&T and DirecTV could be worth at least $40 billion, which is DirecTV’s current market capitalization, the Journal reported.

An agreement would give AT&T a leg up in the race to deliver content through new ways like over the Web and would ease some concerns about DirecTV’s inability to offer fast Internet access.

It would also draw heavy scrutiny from regulators.

The Justice Department and Federal Communications Commission are currently reviewing terms of the Comcast-Time Warner Cable deal, and some consumer activists and members of Congress have urged them to block the acquisition. The cable giant would be too big and too powerful, they have said.

Comcast and Time Warner executives point out that the two companies currently don’t directly compete in any of the same markets, so it should not run afoul of antitrust laws.

DirecTV declined to comment on the report. AT&T did not immediately respond to a request from The Hill.