Satellite service DirecTV is buying rival Dish to combat the onslaught of streaming services

DirecTV is buying Dish and Sling, a deal the company has been trying to make for years as it tries to better compete against streaming services that have become dominant.

DirecTV said Monday that it will acquire Dish TV and Sling TV from its owner EchoStar in a debt swap transaction that includes a $1 payment and the assumption of about $9.8 billion in debt.

The prospect of a DirecTV-Dish combination has long been rumored, and headlines have surfaced over the years about reported discussions. And more than two decades ago, the two almost merged – but the Federal Communications Commission blocked their owners' then $18.5 billion deal, citing antitrust concerns.

The pay-for-TV market has changed significantly since then. As more consumers turn to online streaming giants, demand for more traditional satellite broadcasts continues to decline. And while high-profile acquisitions have proven particularly difficult under the Biden-Harris administration, that could make regulators more inclined to approve the pairing of DirecTV and Dish this time around.

DirecTV said Monday that the deal will help offer consumers smaller content packages at lower prices, essentially providing a one-stop shopping experience for entertainment programming.

We hope this appeals to those who have ditched satellite video services in favor of streaming. The company said DirecTV and Dish have collectively lost 63% of their satellite customers since 2016.

“DirecTV operates in a highly competitive video distribution industry,” DirecTV CEO Bill Morrow said in a statement. “We expect that with increased scale, DirecTV and Dish will be better able to work with programmers to achieve our vision for the future of television, which is to aggregate, curate and distribute content targeted to the Customers’ interests and to become better positioned to achieve operational efficiencies while creating additional value for customers through additional investments.”

The current deal could be an important lifeline for EchoStar. The Colorado-based telecommunications company is reportedly facing bankruptcy as it continues to burn cash and losses pile up.

In a recent securities filing, EchoStar disclosed that it only had $521 million in “cash on hand.” And the company forecast negative cash flows for the rest of the year – but also pointed to major debt repayments ahead, with more than $1.98 billion in debt coming due in November.

“With an improved financial profile, we will be better positioned to further enhance and deploy our nationwide 5G Open RAN wireless network,” said Hamid Akhavan, President and CEO of EchoStar. “This will give U.S. wireless customers more choices and help drive innovation at a faster pace.”

By getting rid of Dish, EchoStar can focus its efforts elsewhere, such as its wireless carrier Boost Mobile.

“We want to win in the mobile phone business. There is no doubt about that,” Akhavan said during a conference call, adding that the company may need to seek additional funds and financing in the future to achieve its goals.

Shares of EchoStar fell more than 14% in midday trading Monday.

The deal between DirecTV and Dish is expected to close in the fourth quarter of 2025. However, that depends on several factors, including regulatory approvals and the write-off of nearly $1.6 billion in debt by bondholders related to Dish.

The combined company will be based in El Segundo, California.

“We believe regulatory approval is likely to be greater than 50% as the combined company can improve its competitiveness by offering a range of linear video packages and taking a more aggressive stance in offering a live streaming video product,” Michael Rollins of Citi Investment Research wrote in a note to clients.

However, the analyst added that there is still significant uncertainty about whether the Federal Communications Commission, Justice Department and other potential regulators will issue the necessary approvals, based on previous conversations with company executives and industry experts in recent years.

Shortly before DirecTV made its announcement, AT&T said it was selling its remaining stake in DirecTV to private equity firm TPG in a deal worth about $7.6 billion.

The move ends the communications giant's remaining ties to the entertainment industry.

AT&T said in a filing with the Securities and Exchange Commission on Monday that it would receive payments from TPG and DirecTV for its remaining 70 percent stake in the satellite television company. This includes $1.7 billion in the second half of the year and $5.4 billion next year. The remaining amount will be paid out in 2029.

AT&T bought DirectTV in 2015 for $48.5 billion. However, in 2021, after losing millions of customers, AT&T sold a 30 percent stake in the company to TPG for $16.25 billion.

AT&T's deal is expected to close in the second half of 2025.