SBC (SBC: news, chart, profile), the nation's No. 2 local phone company, is in discussions to take control of Hughes Electronics (GMH: news, chart, profile), which operates DirecTV, persons familiar with the situation told CBS.MarketWatch.com. But talks are preliminary, a source said.

Due diligence is expected to start shortly, analysts said.

The negotiations could mean that General Motors Corp.(GM: news, chart, profile), parent of Hughes, may finally succeed in selling DirecTV. Late last year, EchoStar Communications (DISH: news, chart, profile) dropped its $18 billion plans to acquire Hughes due to regulatory opposition. See story

The SBC talks present as yet another hurdle for Murdoch. After a year-long campaign for Hughes, the media mogul dropped out of negotiations in 2001, when EchoStar trumped News Corp.'s bid.

Murdoch, head of News Corp., has recently reaffirmed his interest in DirecTV but is only interested in GM's 30-percent controlling stake in Hughes. Up until now, News Corp. has been considered the only bidder for DirecTV.

GM has yet to decide its plans for Hughes, a spokeswoman said. In early January, GM said it's on a 60-day timetable to settle on plan for Hughes, which could include spinning off DirecTV, keeping it private or inviting other strategic partners.

Hughes has long said it has more than one bidder interested in DirecTV. "We have a number of interested parties and we will be reviewing all of our options," Hughes spokesman Richard Dore said.

News Corp., which owns Fox Broadcasting TV network, Twentieth Century Fox as well as the Los Angeles Dodgers, would likely use DirecTV to leverage its programming assets, analysts said.

Don't count our Rupert

Some questioned whether Murdoch would be foiled again in his quest for DirecTV.

"The last time it seemed that Murdoch had the better position but then EchoStar came in," said analyst Steve Mather, of Sanders Morris Harris. "Now its seems like News Corp. has the better spot but they haven't closed the deal yet."

Even with SBC's bid, Murdoch is still seen as the most likely buyer for DirecTV. News Corp. is partnering with Liberty Media(L: news, chart, profile), which has great interest in satellites, for Hughes.

"News Corp. still has the best chance. They clearly seem the most committed," said analyst Thomas Watts, of SG Cowen.

News of the negotiations caused SBC's shares to fall 68 cents, or 2.7 percent, to $24.50. Hughes' stock surged 45 cents, or 4.6 percent, to $10.20, General Motors gained 34 cents to $36.36 and EchoStar added 91 cents to $25.61. News Corp. rose by 30 cents to $25.70.

A bidding war for DirecTV

The most obvious implication of SBC's talks are that GM will likely get a better price for DirecTV, analyst Thomas Watts, of SG Cowen said. Read full story.

But the structure of a Hughes acquisition remains murky, analysts said. A cash bid for Hughes would be valued at $13.5 billion, SG Cowen's Watts said.

Neither SBC nor News Corp. has the resources for a cash bid and will have to take on more debt, Watts said. SBC has about $22 billion in debt and ended 2002 with $3.6 billion in cash. News Corp. had $2 billion in cash and about $7.7 billion in debt.

News Corp. has been gearing up to make a play for DirecTV. In November, News Corp. unit Fox Entertainment raised $1.2 billion in a secondary offering.

GM will probably try to throw PanAmSat Corp.(SPOT: news, chart, profile), which holds $2.35 billion long-term debt, into the sale of Hughes. But neither SBC nor News Corp. is interested in PanAmSat, which recently called off plans to acquire Eutelsat, a European satellite operator.

But whoever buys Hughes could sell PanAmSat to either IntelSat or Eutelsat, Watts said. News Corp. also has an interest in DirecTV Latin America while SBC does not.

Shares of PanAmSat added 4 cents to $13.22.

SBC's plans

SBC's negotiations for Hughes also took many by surprise. The telecom, which owns a 60 percent stake in Cingular, had been expected to make a bid for AT&T Wireless (AWE: news, chart, profile) this year. But the discussions for Hughes, if serious, would mean that SBC would be unlikely to take on two large deals at the same time, said analyst Doug Shapiro, of Banc of America Securities.

"A separate argument could be made that SBC might wish to accelerate a wireless deal that patches Cingular's weaknesses in coverage in order that the wireless/video/telephony bundle is ready for primetime from day one," Shapiro said in a research note.

News Corp. and SBC both declined comment.