(CNN) - AT&T said Sunday that it had agreed to acquire America's biggest satellite television provider, DirecTV, in a deal worth almost $50 billion. If approved by regulators, the acquisition will give AT&T a stronger hand in shaping the future of television distribution and consumption. AT&T-DirecTV would be the country's No. 2 provider of television subscribers behind a combined Comcast-Time Warner Cable. Add it all up, and Comcast and AT&T would control more than half of the market for pay television. "This is a unique opportunity that will redefine the video entertainment industry and create a company able to offer new bundles and deliver content to consumers across multiple screens -- mobile devices, TVs, laptops, cars and even airplanes," said AT&T CEO Randall Stephenson. He described DirecTV as the "best option" for AT&T "because they have the premier brand in pay TV, the best content relationships, and a fast-growing Latin American business."
AT&T's existing television service, called U-verse, only has about 5 million subscribers. DirecTV has more than 20 million. DirecTV also has the popular NFL Sunday Ticket package of out-of-market football games. AT&T hasn't specified whether it has any specific plans for Sunday Ticket. But the wireless company is eager to experiment with new forms of video distribution. Whether people want to sit back and watch live TV on a big screen, Netflix-style on a smart phone, or some other way that's still being dreamed up, AT&T wants to have a stake in it.
AT&T told investors on Sunday that the DirecTV acquisition "provides numerous growth opportunities," in part by by increasing television revenues. Observers have also cited DirecTV's healthy free cash flow -- $2.6 billion in 2013 -- as a motivation for AT&T to make the acquisition. AT&T will pay $48.5 billion for DirecTV in both stock and cash. It will also assume DirecTV debts, meaning the overall value of the deal exceeds $67 billion.