It has already been a tumultuous week and year here in the U.S. when it comes to mega-deals. If approved by regulators, the communications industry landscape would be profoundly restructured. The major ones are of course the pending Comcast acquisition of Time Warner Cable and this week’s move by AT&T to acquire satellite company DirecTV. 

The first deal seems logical as Comcast moves to further concentrate the historically fragmented (by franchise geography) cable TV infrastructure business. However, the AT&T deal has left industry observers and the financial community scratching their collective heads as to both the strategic value of the proposed acquisition as well as the $48.5 billion price tag for 20 million subscribers.  What it did do, not unexpectedly, was set off a flurry of rumors and speculation that DirecTV satellite services competitor Dish Networks (No. 2 with 14 million subscribers) was next in line to be bought and that Verizon was on the horizon as the purchaser.

It turns out that while Dish may be in play, and there is no reason to believe it is not considering it has been on somebody’s wish list for years, but Verizon is not interested.  In fact, Verizon's CEO Lowell McAdam quashed the rumors and quieted the speculation one day after the AT&T deal announcement.

 McAdam could not have been clearer on the subject. He told investors at the JP Morgan Global Technology, Media and Telecom Conference, "I know there are reports out there that we are talking to Dish. I can tell you now, that is someone's fantasy. There were not, and there are not, discussions going on with Dish."  Just to put an exclamation point on this, he added, "I don't think owning a satellite company is something I'm interested in at this point." He went on to add that Verizon’s focus was on over-the-top programming.

The machinations about the future of Dish, who has spent billions of dollars over the years to acquire wireless spectrum are certain to continue.  The satellite TV services business is mature and growing slowly, but that hoard of spectrum is certainly enticing to a long list of companies with financial heft—including those who would like to deliver content over their own content delivery network (CDN).

In addition, given industry dynamics, while Dish CEO Charles Ergen has already stated he does not have the financial resources to get in a bidding war with AT&T over DirecTV (something Dish attempted to do unsuccessfully in 2001); assuming the AT&T deal has not closed or comes undone for some reason, if the Comcast deal for Time Warner Cable is approved by regulators Dish would have an interesting case as to why terrestrial consolidation is OK but satellite is not. 

This game of musical chairs just keeps getting more and more interesting.  Who knows which chairs will be occupied the next time the music stops and who will have to leave the party. Even attempting to figure out who are the hunters and who are the hunted is becoming a challenge given the rapid technology convergence and changing consumer consumption habits that are disrupting relationships and business models around the world, and driving the  current reshuffling of the deck .

Finally, from a strategic level, looking at all of the deals brings into sharp relief the question at a very high level of ecosystem evolution, i.e., just how important is ownership of physical networks and is a vertical integration model based on network ownership as a core asset the way to go in an OTT world with in theory and open Internet? 

 It has become apparent that whatever happens on a host of fronts—technology, public policy, M&A, etc. — the next 12-18 months is going to dictate what the industry and markets look like globally for many years to come. We certainly live in incredibly interesting times. I can’t wait for the next exciting episode of the reality show, “As the Communications World Turns.”