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AT&T-DirecTV $48 Billion Merger Inches Closer to Federal Approval

Justice Department closes antitrust investigation; FCC Chairman Tom Wheeler recommends approval of the deal with conditions

FCC Chairman Tom Wheeler recommended approval of AT&T's proposed $48 billion acquisition of DirecTV in a statement Tuesday.

The statement was followed by an announcement that the Department of Justice's Antitrust Division will close its investigation into the merger.

An order currently circulated to FCC commissioners for approval includes conditions that will "directly benefit consumers by bringing more competition to the broadband marketplace," Wheeler said.

"The conditions will build on the Open Internet Order already in effect, addressing two merger-specific issues," Wheeler said. "First, in order to prevent discrimination against online video competition, AT&T will not be permitted to exclude affiliated video services and content from data caps on its fixed broadband connections. Second, in order to bring greater transparency to interconnection practices, the company will be required to submit all completed interconnection agreements to the Commission, along with regular reports on network performance."

Assistant Attorney General Bill Baer of the Antitrust Division said the DOJ's investigation benefited from the division's "close and constructive working relationship with the FCC."

"After an extensive investigation, we concluded that the combination of AT&T's land-based internet and video business with DirecTV's satellite-based video business does not pose a significant risk to competition," Baer said. "The commitments that the proposed FCC order includes, if adopted, will provide significant benefits to millions of subscribers."

FCC approval would provide 12.5 customers with access to a high-speed fiber connection, Wheeler noted.

"This additional build-out is about 10 times the size of AT&T's current fiber-to-the-premise deployment, increases the entire nation's residential fiber build by more than 40 percent, and more than triples the number of metropolitan areas AT&T has announced plans to serve," he said.

As one of the conditions, the FCC will require an independent officer to ensure compliance with the proposed conditions, Wheeler added.

"These strong measures will protect consumers, expand high-speed broadband availability and increase competition," he said.