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Comcast is no longer the largest pay TV company in America

The Comcast logo is seen on a retail store in Sacramento, California on July 3, 2015. (Photo: Matthew Keys / The Desk)
The Comcast logo is seen on a retail store in Sacramento, California on July 3, 2015. (Photo: Matthew Keys / The Desk)

Comcast, once the largest pay television company in America, was usurped last week by AT&T after the telecommunications giant best known for phone and Internet service closed on its acquisition of satellite television company DirecTV.

The closure of the $49 billion deal by AT&T came after federal regulators gave their approval of the giant merger between the phone and satellite companies.

The Federal Communications Commission offered its approval of the merger on Friday. As a condition of approval, AT&T promised to expand its rollout of fiber optic Internet lines throughout the United States and upgrade broadband connections to schools and libraries.

The merger comes several months after Comcast’s failed takeover of rival Time Warner Cable. The proposed merger between the two caused federal regulators to worry that a purchase of the second-largest cable TV company by the largest cable company in America would be bad for competition.

The same wasn’t true of AT&T and DirecTV, which until Friday had largely conducted business in different areas of the communication industry. AT&T is best known for providing phone and Internet service to homes and businesses.

AT&T does have a television service — AT&T U-Verse TV — but its customer base pales in comparison with DirecTV and even some regional cable operators. DirecTV, on the other hand, is the largest satellite television company in the United States with over 26 million paying subscribers. AT&T’s U-Verse TV has around nine million paying subscribers.

The combined company will have a total of over 35 million paying TV subscribers. The number is significantly larger than that of Comcast, which has just 20 million pay TV subscribers, a number that has declined over the last several quarters.

It is not clear if AT&T will continue to offer its U-Verse TV service or if the company will end it in favor of shifting customers over to DirecTV. The satellite company also operates a fleet of services in Latin America, where AT&T will now pick up more than 19 million customers. It was not immediately clear of AT&T planned to continue operating the Latin America subsidiary of DirecTV.

DirecTV was previously based in El Segundo, California. Under AT&T’s ownership, its new headquarters will be based in Texas, although AT&T signaled it will keep the satellite company’s El Segundo operations going for the time being.