The communications industry long has
promised a future where wireless service, video and the Internet are offered in
one convenient package. Three huge possible deals now are bringing that future
Cellphone and Internet provider AT&T Inc. is looking to buy satellite company DirecTV. Cable and
Internet provider Comcast Corp. is
considering offering mobile-phone service over Wi-Fi if its planned $45 billion
merger with Time
Warner Cable Inc. is
approved. And cellphone company Sprint Corp. says it could provide home Internet connections
over wireless if it is allowed to buy smaller rival T-Mobile US Inc.
In theory, the deals would
usher in an era in which consumers would get new, flexible options to be
entertained and communicate wherever and however they choose.
But the path to that
idealized world is perilous, requiring that regulators approve mergers that
would create still-bigger companies in industries where Americans already have
There are two possible
outcomes, says Blair Levin, a former Federal Communications Commission chief of
staff who helped draft the agency's road map for increasing broadband access.
In one, the companies
bulk up and start competing aggressively, creating exciting new services.
In the other, new
competition from technologies such as Internet broadband via wireless or
mobile-phone service via Wi-Fi don't pan out, giving the biggest legacy
companies more pricing power than ever.
It is impossible to know
which one will prevail, says Mr. Levin, a fellow at the Aspen Institute think
tank. "Anybody who thinks they know is probably wrong."
Consumers have a lot on the
line. Wireless, pay TV and broadband Internet service gobble up a big slice of
Americans' time and money. Annual household spending on telephone, pay TV and
Internet service averaged $2,237 in 2012, the Labor Department says. That was
up 20% from 2007, while overall household spending rose just 3.6%.
"Any of these deals
individually would represent a major shift," says Rick Kaplan, former head
of the FCC's wireless bureau. "Taken together, it is a pretty impressive
transformation of the industry in a very short period of time," says Mr.
Kaplan, the head of strategic planning at the National Association of
for the full article in the Wall Street Journal.