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AT&T nets $7.8B from sale of part of DirecTV and AT&T TV Now

AT&T will own 70% of the New DirecTV business.

Corinne Reichert Senior Editor
Corinne Reichert (she/her) grew up in Sydney, Australia and moved to California in 2019. She holds degrees in law and communications, and currently writes news, analysis and features for CNET across the topics of electric vehicles, broadband networks, mobile devices, big tech, artificial intelligence, home technology and entertainment. In her spare time, she watches soccer games and F1 races, and goes to Disneyland as often as possible.
Expertise News, mobile, broadband, 5G, home tech, streaming services, entertainment, AI, policy, business, politics Credentials
  • I've been covering technology and mobile for 12 years, first as a telecommunications reporter and assistant editor at ZDNet in Australia, then as CNET's West Coast head of breaking news, and now in the Thought Leadership team.
Corinne Reichert
2 min read

AT&T owns 70% of New DirecTV, and has netted $7.8 billion to sell the remaining 30%.

Sarah Tew/CNET

AT&T has reached a deal to sell off a minority stake in its satellite TV arm for $7.8 billion, the carrier said Thursday. AT&T and private equity firm TPG will form a new company, called New DirectTV, in which AT&T will own a 70% stake and TPG 30%. The company will include the DirecTV, AT&T TV Now and U-Verse video services.

The deal values AT&T's DirecTV business at $16.25 billion.

Read more: Every streaming service ranked: Disney Plus vs. Netflix, Amazon Prime, Peacock, HBO Max and Hulu

Current AT&T video customers will become New DirecTV subscribers once the transaction is completed, and will keep their video service, as well as any bundled wireless and broadband services and Max accounts. There were 17.2 million subscribers of AT&T's US video unit by the end of 2020.

Existing content deals will also transfer over to New DirecTV, including NFL Sunday Ticket.

The new company will be run by two representatives from AT&T and TPG, as well as Bill Morrow, CEO of AT&T's US video unit.

It follows reports in August that AT&T was again considering offloading its DirecTV business to private equity firms in a deal worth less than $20 billion.

The move comes as AT&T focuses more on streaming services after AT&T's WarnerMedia launched streaming service HBO Max in July 2020. Max is the most expensive streaming service on the market, costing $15 a month.

AT&T merged AT&T TV Now -- its streaming service -- with AT&T TV, its cable and satellite alternative, in January this year. The carrier had launched AT&T TV in March 2020 to provide DirecTV channels over internet streaming rather than satellite. AT&T TV was designed to replace DirecTV and traditional cable TV. It features live TV channels -- including ABC and Fox, plus cable channels such as ESPN, TNT, Nickelodeon and HGTV -- that are streamed over the internet.

AT&T was reportedly first looking to ditch DirecTV or merge it with Dish in 2019 after it lost 4 million pay TV subscribers in 2019, ending that year with 20.4 million subscribers in the US.