T-Mobile paid about $325 million to acquire Layer3 TV, the Denver-based MVPD, according to a 10-Q document filed as T-Mobile released Q4 2017 financial results.
T-Mobile noted that the final value of the deal remains subject to customary working capital and other post-closing adjustments. T-Mobile added that its Q1 2018 results will include the results of Layer3 TV, which is now a wholly owned consolidated subsidiary of T-Mobile.
T-Mobile announced its acquisition of Layer3 TV in mid-December and closed the deal on Jan. 23, 2018.
T-Mobile plans to use the acquisition to underpin the launch of a “disruptive new TV service” later this year that, it promises, won’t be a carbon copy of other skinny bundle OTT TV services that have entered the market.
In addition to competing with traditional pay TV operators, T-Mobile’s coming OTT TV offering will also do battle with a growing group of virtual MVPDs that include DirecTV Now, fuboTV, Hulu, YouTube TV, Philo, PlayStation Vue, and Sling TV.
T-Mobile hasn’t detailed pricing and packaging for what coming, but has set up a web site (www.t-mobile.com/tv) that lets prospective customers input contact info to they can be informed when an “exclusive offer” from T-Mobile will become available to them in their respective areas.
T-Mobile’s pay TV service will also be a true OTT offering, in that consumers will be able to access the service through any internet connection.
Founded in 2013, Layer3 TV had raised about $100 million prior to the acquisition from investors that included Altice, Evolution Media, Paulson and Company, and North Bridge Venture Partners.
About 200 Layer3 TV employees have joined T-Mobile. T-Mobile’s new TV team is led by Jeff Binder, CEO of Layer3 TV, who is now an EVP at T-Mobile and part of the company’s senior management team.
Prior to the deal, Layer 3 TV has been focused on in-home, full-freight pay TV packages using advanced interfaces working on gateways and set-top boxes that are all capable of supporting 4K video and integrating select OTT apps/services, including CuriosityStream, Pandora, Xumo, YouTube and iHeartRadio.
Layer3 TV currently uses its IP infrastructure to deliver TV service in Los Angeles; Chicago; Washington D.C.; Dallas/Ft. Worth; and Longmont, Colo. (in partnership with a municipal provider called NextLight), and had previously announced plans to introduce service in New York. Layer3 TV has not disclosed subscriber numbers.
As T-Mobile develops the new TV service, the existing Layer3 TV provide will be available to demo or purchase in select T-Mobile stores in Chicago, Dallas, Denver, Los Angeles and Washington, D.C.