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SBC, DirecTV hook up
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July 16, 1999: 8:20 p.m. ET
Baby Bell, satellite-TV firm unveil wide marketing pact
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NEW YORK (CNNfn) - Telecom powerhouse SBC Communications Inc. announced a big push Friday into television through a marketing and distribution alliance with satellite-TV provider DirecTV.
SBC, which has been bulking up through mergers to do battle with long-distance leader AT&T Corp. and others, will offer satellite-based digital TV service to 18 million customers in 7 states this fall.
The pact allows SBC to provide satellite-based TV to customers as its response to AT&T's recent rush into the cable TV business. AT&T has inked $90 billion in deals in the last year to boost its cable holdings.
"This agreement allows us to meet our customers' needs and tap into what we believe is a growing market opportunity," Royce Caldwell, vice president of SBC operations said in a statement.
In effect, the alliance would allow SBC to bundle its telephone services with a diversified slate of TV channels and programs.
For DirecTV parent Hughes Electronics Corp. (GMH), a unit of General Motors Corp. (GM), the alliance would give it a key distributor for what is already the largest satellite-TV provider in the United States.
In 1998, SBC and DirecTV entered into an alliance that added DirecTV programming services the package that SBC sells to owners of multiple dwelling units through SBC's SmartMoves program.
DirecTV has a marketing alliance with another SBC rival, the Northeast regional phone company Bell Atlantic (BEL).
San Antonio, Texas-based SBC, the parent of Southwestern Bell, Pacific Bell and Nevada Bell, awaits regulatory approval of its $62 billion merger with Chicago-based Ameritech (AIT).
AT&T (T) lured Hughes Chairman C. Michael Armstrong to the AT&T helm in November 1997, shortly after which the telephone powerhouse sold its small stake in DirecTV.
Shares of SBC (SBC), one of the most widely-held stocks on Wall Street, closed up 2-3/16 to 59-3/16 Friday, while shares of Hughes rose 1-1/8 to 60-9/16. 
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