In what could be a reaction to an activist AT&T investor, reports suggest DirecTV -- the weakening satellite service -- could possibly be sold or spun off.
One scenario could be a merger with longtime competitor Dish Network.
On Tuesday, at a Goldman Sachs investor conference, Charlie Ergen, the co-founder and chairman of Dish, speculated about a possible merger, but warned that regulatory issues would be a problem.
Last week, Elliott Management -- which has a $3.2 billion stake in AT&T -- pushed for a shake-up of the company, especially in light big acquisitions, including DirecTV, and more recently, Time Warner.
Dish and DirecTV have explored a possible combination in the past, but regulatory concerns were a major hurdle. On Thursday, a CNBC report said AT&T and Dish Network are not in discussions over a deal due to regulatory issues.
Investors' talk of a possible DirecTV and Dish Network merger had Dish stock rising 5% in after market trading on Wednesday and up 1.5% on Thursday to $23.03. AT&T’s stock was 1% higher to $37.14.
DirecTV has seen a decline of almost one million subscribers this year. Dish Network has seen a loss of nearly 300,000 subscribers.
AT&T acquired DirecTV in 2015 for $49 billion. Last year, AT&T closed its Time Warner deal for $85 billion.
The combined satellite pay TV services would have around 29 million subscribers.
Both DirecTV and Dish have started up internet-based pay TV services -- DirecTV Now and Sling TV, respectively -- in recent years. After a quick rise in business, currently both have seen slowing or declining subscriber growth.