I used to be a sportswriter. I bring this up not to open the closet on the multiple skeletons of my past as much as to explain how sometimes reporting on sports rivals covering telecommunications. Because teams are ultra-secretive, sportswriters spend much of their time creating or listening to rumors. There's a term for it: the Hot Stove League. That's the time during the offseason when baseball fanatics conjure ways, real or imagined, that their teams will bulk up for the next year's pennant chase.
Sportswriters and their editors are almost daily presented with credible and incredible reports of trades and team goings-on. Teams might be more secretive than the National Security Council but they leak worse than a dirigible with a bullet in its guts, so there are plenty of rumors to go around. The trick is to look at each one, decide what's the most likely to happen, see if you can find a plausible reason why it might, consider the source and then write about it. True or not, if it sounds good, it will spread like wildfire.
Which brings up last week's report that AT&T (NYSE: T) is considering buying Dish Network (Nasdaq: DISH). The report's credibility came from the fact that it was floated by a Credit Suisse analyst report. Its likelihood was reinforced by the fact that such a deal would make lots of sense for both teams--er, companies.
First, Dish, especially if it gets its hands on DBSD North America, which it's trying so desperately to do, would hold a lot of spectrum that looks ultra-valuable to AT&T--which, as everyone should by now know, is more interested in all things wireless than all things wired. Second, it would make sense for Dish because it would provide a land-based (or cloud-based if you will) source of interactivity to combat the cable companies and, frankly, that blossoming romance between DirecTV (Nasdaq: DTV) and Verizon (NYSE: VZ).
DirecTV and Verizon? Of course. Word on the street has been that those two are closer than Brangelina; that they're working on an LTE-satellite connection that will block the socks off anything cable has to offer; and that, frankly, a marriage rather than a hot romance would make a lot of sense for all the reasons an AT&T-Dish consummation would.
In any event, it is, as the sportswriter in me well knows, just talk right now--sensible talk, to be sure, but just talk.
This doesn't mean cable operators shouldn't be paying attention. Cable's big advantage right now is its broadband pipe. As video purveyors, cable operators are often viewed as also-rans, especially with the new crop of over-the-top material available without a cable video package.
A combination of a satellite provider and wireless could reshuffle cable's broadband deck, especially if the wireless is genuine, up-to-snuff 4G LTE. When combined with satellite, perhaps some fiber or likely just twisted pair DSL and a phone company's long reach, it could create a contender.
That's the kind of chatter that will keep a stove hot for a long time.--Jim