FCC chairman recommends OK of $48.5B AT&T-DirecTV deal

Sources tell the Wall Street Journal and Reuters that FCC boss Tom Wheeler has circulated an order among his fellow Commissioners to approve the deal with conditions.

He also said that AT&T will not be permitted to exclude affiliated video services and content from data caps on its fixed broadband connections, a practice that some critics have said violates net neutrality rules.

Wheeler’s recommendation order stipulates that AT&T should ensure that 12.5 million customer locations will have access to a high-speed fiber connection, which represents a build-out 10 times the size of the telecom company’s current fiber-to-premise deployment.

The company will have to submit regular reports on “network performance” to the FCC. As outlined by Wheeler, AT&T won’t be allowed to implement a similar program on its home Internet service.

Wheeler said the FCC will also require an independent officer responsible for ensuring compliance with the conditions. “These strong measures will protect consumers, expand high-speed broadband availability, and increase competition”.

The El Segundo company has maintained its customer base by offering such popular programming as NFL Sunday Ticket, but it did not have the ability to offer customers a discounted package of telephone, Internet and TV service.

The Department of Justice is expected to sign off on the deal with no conditions whatsoever.

The relatively smooth approval process so far is in direct contrast with what Comcast encountered when its bid to buy Time Warner Cable for $45 billion was quashed by regulators in April. In addition, AT&T has led the outrage – and legal pushback – among Internet companies and others who object to the FCC’s landmark 3-2 decision this spring sweep broadband internet service under its Title II regulatory oversight.

Update: AT&T has now issued a statement announcing the U.S. Department of Justice has “completed its review” of the deal, and saying “we look forward to gaining the approval of the Federal Communications Commission so we can quickly begin providing consumers with the benefits of this combination”.