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Read the attached word document and the reference page and in 200 words or less: Summarize the methods the team used to develop creative solutions to develop this paper. Here are the things we did:
Running head: PROBLEM IDENTIFICATION Problem Identification


Learning Team A




November 8, 2016




Problem Identification Based on the article ?FCC OKs AT&T DirecTV Deal several reports were set concerning


the internet interconnection pacts as follows; The FCC approved the license and authorization


transfers that were involved in the proposed merger of AT&T, Inc.and DirecTV, Inc. with some


conditions that covered extensive commitments by the merged company in order to submit its


internet connection agreement to the authorized commission for review. The FCC? s statutory


standards for reviewing these license transfers associated with the mergers and other transactions


is to determine whether they are in the public interest or not since justice reviews transactions


under an antitrust standard (Stanton, 2015).?




AT&T?s claims to be the greatest provider of phone and cable services in the world,


implying that a larger number of subscriber?s base and corresponding ability is mainly leveraging


efficiencies to deliver low-cost programming. However, several parties have expressed concerns


regarding potential harms to smaller cable operation in accessing programming or managing to


access the content at affordable costs (Stanton, 2015). In addition to this, the public supporters


and other cable TV operators reprimand the approval order concerning merging of the two


companies because the supporting conditions to overcome harm that could be created was not


sufficiently provided. ?Generally, Techfreedom is characterized by the agency?s merger review


as regulation by extortion sites, in addition to the conditions for review of other internal


interconnection agreement and for hiring the internal and external compliance officer. The article


clearly states that the FCC is trying to recreate the traditional rate regulation in all but its name at


the expense of imposing rate regulation on the internet (Stanton, 2015).? PROBLEM IDENTIFICATION 3


Problems Concerns The problem that has arisen and affected the cable universe is lessening. In addition to


that, satellite subscriber progress has stalled DirecTV lost 133,000 net subscribers in the second


quarter. Pay TV also lost its modern development engines due to the drastic shift in the television


world. With the newly accomplished, $48.5billion AT&T-DirecTV merger, the multichannel


video-programming distributor (MVPD) business claimed a new front-runner. With 26.4 million


video clients, the post-merger AT&T has the probability of bringing high-speed Internet, voice


and video services to underserved marketplaces across the United States.


Consolidation, competition, and new watching behaviors are altering the pay TV landscape, with


more reduction anticipated as superior contracts close and minor cable organizations are broken


up by larger peers. The merge is putting small companies in a tight situation where it's forced to


have a mandatory fused cable company eventually. (Farrell 2015).


Why this is an Underlying Problem


The selected works discuss the issue that is mergers in the telecommunication industry


which result in the problem of the decline of smaller companies. Farrell?s Eat or Be Eaten


presents the general merger and acquisition landscape in telecommunication and its impact on


firms over the years with firms that don?t merge declining and wholly disappearing. Santon?s


article specifically addresses one such merger, the AT&T-DirecTV merger. Such mergers are an


issue because they go against the public good and undercut smaller rivals in the market and in


the long run could result in a monopoly.


The underlying problem with this issue is the constant change in technology and in trends


in the telecommunications industry. Cable operators were dependent on their basic-video


subscriber rolls, but these stopped growing with the turn of the new century (Farrell, 2015). PROBLEM IDENTIFICATION 4 Companies with the required infrastructure were able to make a smooth move to the broadband


industry. AT&T had a monopoly on broadband infrastructure, and its acquisition of TCI


Communications placed it at the top, and constant mergers have enabled it to stay there. The


basic-video subscriber industry peaked in 2001 at 66.9 consumers and by 2014 had sunk to 54


million subscribers (Farrell, 2015). Companies like Comcast, which continued to focus on


mechanisms to grow their video subscriber subscribers, suffered losses that moved it from 3rd in


the industry in 1995 to sixth five years later (Farrell, 2015). The cable industry shifted again


towards satellite subscriptions putting DirecTV in the big leagues at position 3 in 2,000 (Farrell,




It is clear that companies that resist the constant changes in technology suffer losses. This


then leads to larger companies acquiring them to use certain elements of their service while


preventing their financial crisis. Different companies bring different strengths to the table as in


the case of AT&T broadband and TCI. Currently, companies still merge to combine their unique


strengths. Take the 2015 merger of AT&T and DirecTV for example; DirecTV lost 133,000 net


subscribers in a single quarter (Farrell, 2015). It was imperative that it changed some aspects of


its service. Creating its own broadband infrastructure would not be economically feasible


(Santon, 2015). AT&T would benefit from DirecTV?s satellite services and there a merger was




Relate the Research to the Problem


The merging of DirecTV and AT&T has been of great benefit to the public and for


DirecTV as well. DirecTV has always been more affordable than cable, but it wasn't as appealing


as other cable companies as it didn't offer the bundles the public was interested in. This merge


gave AT&T the opportunity to lead the way and to redefine the video entertainment business for PROBLEM IDENTIFICATION 5 a mobile and high-speed world. This deal is good for competition and the public's interest. The


public has more affordable choices and access to broadband and telephone service.


After the justice department investigation, the Assistant Attorney General Bill Baer stated


the combination of AT&T and DirecTV does not pose a significant risk to competition (Stanton,


2015). This merge was a bigger benefit to DirecTV; consumers expect to get the content, and


programming they need as well as data on any device they want. If a provider doesn't satisfy


their customers in the future, they will be out of business. With the merging of the two


companies, it puts AT&T at number 1 in the top MVPD's list (Farrell, 2015).


?Problem Identification


Clearly defining problems in a business setting is imperative to explore the situation in


depth. The acquisition of DirecTV by AT&T in 2015 undeniably contained several challenges,


yet many times the problems provide their solutions. One of the concerns raised was that of


potential customers that live in MDUs (multi-dwelling units) would not be able to benefit from


the promotional pricing of combining Internet and television services because he or she would


not be permitted to install the dish satellite needed for DirecTV, (Stanton, 2015). Accurately


defining the problem makes it easier to find solutions to any business situation; it also saves the


company time, money, and resources. Another problem presented in this merger between AT&T


and DirecTV is the impact it would have on smaller cable providers. Without a doubt AT&T and


DirecTV are large entertainment providers and the merger would certainly affect all competitors.


However, some restrictions apply for certain customers, such as the price of bundle packages,


availability, and contract terms. Although the merger of these two huge companies did impact


other providers, it has not destroyed these companies, and it is evident that the fierce competition


still exists in the entertainment world. PROBLEM IDENTIFICATION 6


Conclusion As cited by (Farrell, 2015, p. 1), ?AT&T completed its $48.5 billion acquisition of


Direct TV, raising its video subscriber tally to 26.3 million customers and vaulting the telco to


the top of the list of multichannel video programming distributors.? AT&T has the capability of


bringing high-speed internet, voice and video services all across the United States. The constant


change in technology and trends in the telecommunications industry is always in demand. It is


clear that companies that resist the constant changes in technology suffer losses. By AT&T


acquiring Direct TV and their services, it prevented an economic deficit. This merge also lead


the way and redefined the video entertainment business for a mobile and high-speed world. AT


& T and Direct TV have proven they planned accordingly during this merger to avoid a serious


economic decline in their business. It is clear they have evaluated their plans for validity to


ensure the overall success of the company. References


Farrell, M. (2015, August). Eat or Be Eaten. Multichannel News, 8-10. PROBLEM IDENTIFICATION 7 Frieden, R. Rationales For and Against FCC Involvement in Resolving Internet Service Provider


Interconnection Disputes. SSRN Electronic Journal.


Stanton, L. (2015, August). FCC Oks AT&T-DirecTV Deal, Sets Condition to Report


Internet Interconnection Pact. Focus On, 81(15).


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