On the bright side, maybe it'll distract SBC

SBC is thinking about buying DirecTV. The presumed theory is that SBC needs to be able to offer Local+Long Distance+DSL+TV to compete with the cable companies offerings. This is Michael Powell’s wet dream: megacorporations slugging it out like giant Japanese robots in the marketplace.
It was the ideal of one-stop communications shopping that doomed AT&T. SBC is currently running baffling ads in California which tout the principal benefit of buying local and long distance from the same company as the convenience of having a single bill. It turns out that consumers didn’t want one bill for all their communications services, because once they saw the bill it was too damn big.
This strategy also failed in the banking industry, where it was known in the eighties as “the financial supermarket”.
It may make sense for the cable co’s to use as much of their coaxial cable to offer lots of services. But there is no logic in SBC buying a shaky company in an industry about which they know less than nothing. Unfortunately for them, there is no competitive symmetry. SBC would be better off if Rupert Murdoch bought DirecTV and kept Comcast execs awake at night.
I wonder if SBC had anything to do with DirecTV deciding to get out of the DSL business.

Leave a Reply

Your email address will not be published.