And What Happens with DISH?

[Steve Mehs]

With a merger deal in place between Hughes/DirecTV and News
Corp., what's expected to happen to Charlie Ergen and EchoStar?

Merrill Lynch satellite analyst Marc Nabi said DISH shares
could see near-term weakness if and when the DirecTV/News
Corp. deal is closed. However, long-term, "We believe the
market will further justify EchoStar’s premium valuation since
it will be the only independent national multichannel
television footprint remaining with the fastest subscriber and
free cash growth profile across the pay-TV industry," Nabi
said in a research note.

And don't be surprised if Ergen, chairman and CEO at EchoStar,
"would sell all or a portion of his 242-million share stake"
to a vertically integrated media or telecom company, Nabi
said. Ergen has 48 percent economic/90 percent voting control
of DISH. If he sold out, Nabi said he envisions a deal struck
in the next 12 to 24 months.

News Corp. Chairman Rupert Murdoch doubted Ergen would exit
the satellite TV business. "He would be lost without
EchoStar," he said Wednesday. "He lives that business and he
runs it very well."

EchoStar said its executives are traveling out of the country
and could not be reached for comment concerning the
Hughes/News Corp. deal.

From SkyReport (http://www.skyreport.com) (Used with Permission)

[Scott Greczkowski]

What I believe is Charlie needs to get off his butt and show why he is the best satellite provider.

He has such a wide dealer base yet treats his dealers like CRAP.

Charlie is always big on talk yet light on action. His nickname Cheep Charlie proceeds him.

Time to shake the image and do a turn around, use the dealers to his advantage (and stop screwing them over) Time to give people what they want.

Time for a wake up call.

[Randy_B]

Start this shift by buying Replay at auction.

[Scott Greczkowski]

Originally posted by Randy_B
Start this shift by buying Replay at auction.

I second this statement! :D

[AJ2086]

Rupert could put Charlie and E* under in less than 5 years. Unless Charlie changes his ways and trys to be more competetive he is screwed. And because Charlie and Rupert have this personal little thing between them it will make the competetion stronger. I can see E* going under and Rupert picking up all of there slots for cheap. Maybe not all but 1/2. E*'s best chance of survival is to partner with a programmer.

[Scott Greczkowski]

AJ I hear what your sayingand agree with you! I just hope and prey that the partner does not turn out to be Disney.

[angiodan]

Yeah, but Scott, then we would have seen ESPN-HD on day 1!!

With a big price increase!

[msanto]

This deal w/ DirecTV is something to worry about. I've only had sat (and Dish) for about a month; I'm starting to worry that I picked the wrong carrier.

'Course my wife loves it, and won't even consider switching after our 1 year term is up.

I must say I'm disappointed in:

1) the features of the PVR vs. Tivo

2) all these negative Charlie comments

3) Dish not taking chances that could really help like buying Replay ...

Guess I should have done more research before jumping in. I mostly chose Dish because there was no monthly PVR fee as well as the overall pricing. Plus I wouldn't have to hack the PVR to get a larger HD.

[Frapp]

I`ll take the unpopular attitude here and predict Charlie will sell E* ( or his share of it anyway ) within the next 2-3 years.

Why, because as Charlie has stated, DBS has enjoyed it`s best penetration/subscriber rate. I believe he even stated DBS growth probably peaked out in 2000.

Also, in addition to the strong competition Rupert is about to launch, cable has come a long, long way all over the US. This is a fact regardless of your opinion on cable systems or their performance. When a cable company offers a Dish buy back plan in a major city, quite a few people switch back.

Just my opinion :shrug:

[AllieVi]

While management of the two companies has struck a deal that will probably happen, many months will pass before Murdoch is actually in control. Shareholders of GM have to accept the offer (there's no reason to expect they won't) and appropriate governmental agencies also have to bless the transaction. Charlie has lots of time to consider his course of action.

[RAD]

Maybe that's why Dish is going to offer 100+ channels of international programming. Dish will become the provider of choice for international programming in the US and settle for doing US programming as a side business.

[AJ2086]

Well I think Rupert will do wonders for DirecTV, hopefully the first thing he will do is buy some more sat space for DirecTV.

[Jacob S]

I agree with Charlie ripping the retailers and treating them like crap, because I am one and he is trying to charge me much above retail price for the receivers in which I cannot sell them now because I cannot compete against his own prices or sell for retail as a result unless I lose my but. That is just one of many things, CSR's lying to my customers causing me chargebacks and so forth. It has to stop sometime. Things were not like this when I started business but now I may be going out of business because of how Charlie is. He is losing customers because he upped the price on me and blames me for why customers do not pay their bills or disconnect early charging me $100 above retail. Its pathetic. I never had such problems as I have the second half of last year that resulted in this. Charlie wanting to dump Dish is OBVIOUS with his change in treatment to retailers and the attitude change the last few years. He knows whats coming.

The only way they would be able to partner with a program provider is to have further competition like Cablevision Rainbow or the provider going to 105.5 and with all the subs Dish has it may be hard to pull them down in 5 years unless he can get most new subscribers and take away his sub base little by little until its so low that the stock crashes or to where they cannot profit and they give up. Perhaps that would be like a merger but the only legal way of doing it and they could get together and do this although if they got caught they would get into huge trouble. If it is not planned though and Direct does take the whole market taking Dish customers then Direct would have a lot more satellite slots and be able to operate just as if there was a merger with lower costs. It would take a good while though if it would even happen in which I would doubt.

[Randy_B]

I would be absolutely amazed if Charlie sells, that would give the appearance that Sir Rupe drove him out. I think Rupe's presence in the US sat market will make Charlie nuts and drive him to make some amazing agreements and moves (I suspect Replay looks really attractive to Charlie today). I am sure Charlie Ergen would love to shove a business "thumb" in Rupe's eye.

Of course if Rupe merges DirecTV with BSkyB and puts BBC1,2, 4 and ITV on in the US, then I might have to reexamine the situation.

[Joe Capitano]

Originally posted by Randy_B
Of course if Rupe merges DirecTV with BSkyB and puts BBC1,2, 4 and ITV on in the US, then I might have to reexamine the situation.

What? No BBC THREE? What's Rupert got against the blobs? (The channel's icons - go to bbc.co.uk for a look)

Seriously, BBC doesn't market its domestic channels internationally, just the programming, so BBC America/Canada/World is about as close as we'll get to the real thing. It would be nice to see them, though.

As to the overall deal, as long as FOX doesn't play unfair with dish and all their channels reamain available on both services, I don't see any problem with it if the regulators don't. Bring it on.

[Kagato]

If I understand things, Murdock is really looking to expand his Asia Pacific business. I have doubts about how much he's going to put into D*'s US operations. His son James (on the board of Star TV [asia]) takes the cake in courting the Chinese:

"In March 2001 James even out-ingratiated his father, denouncing Falun Gong at a time when thousands of members of the banned religious sect were in prison and at least 100 were reported to have died in detention as a result of neglect or torture.

The younger Murdoch also criticised the Hong Kong and western press for painting such a negative portrayal of China. "I think these destabilising forces today are very, very dangerous for the Chinese government," he told an audience of businessmen in Los Angeles. "

In my opinion this is not a customer focused group of people. They are looking at making money. Number one will be Asia. They see a way of getting exclusive rights to China's very new DBS market. Second will be getting D* to make money. That most likely means changing some things. Now I don't think D* will go bad. I just don't think it's going to turn into the HDTV Nirvana some of you think it will be. Nor will their rates go down or anything. I think this will be a battle of exclusive deals, retail lock outs, special content.

I expect US regulators will rubber stamp the deal as he's a lot more in line with the administration than Charlie ever was...

[PSB]

I done two installs today, both were change overs from Dish to DirecTV, just stating a fact ! I am Glad "Rup" looks he is going to get DirecTV, but I am very worried about my livelihood, I came from the UK, where all the BSKYB installers are hourly paid, and very badly treated (like Dish installers here), they work them selves up the ladder (no pun intended) and when they start making semi decent money they find an excuse and dump them, then they get another kid in and start again, in the UK the only Busy time of the year is Xmas, and then they pay off most of the installers.

What I am hoping for is all the BBC channels as above, and I look forward to seeing Sky News, and all the other Sky channels. I hope every one is writing to the BBC asking for their domestic channels here? I have, its the only way it will ever happen!
Also I worry about Dish adding 100 new International channels! There is already a company doing all international channels (Globecastwtv) and most are free!!!!

[normang]

Its far to early to say which way the wind is blowing.

I am in the camp that saying that Murdoch is going to turn DTV into some sort of panacea is extremely premature. The deal could easily sour if regulator's start attaching strings to the deal no matter how "in" you think Murdoch is.

[lee635]

Originally posted by AJ2086
Well I think Rupert will do wonders for DirecTV, hopefully the first thing he will do is buy some more sat space for DirecTV.

Where is Mr. Murdoch going to get the money? Fox is way leveraged and the street is very concerned about this. I honestly don't know where you think he will get the money to do any "capital" expansion. Frankly, I think we'll see operating changes by the new owner to throw off higher net operating revenue to cover the massive debt service they've accumulated.

"As result of the deal, she continued, "we are less convinced that Fox is managed as an operating entity rather than a financing vehicle for News Corp..."

news (http://cbs.marketwatch.com/news/story.asp?guid=%7B8A40A841-3C39-44B3-9572-F8E4BEEE7441%7D&siteid=google&dist=google)

[Mike D-CO5]

Don't count old Charlie out yet! Didn't he dupe Rupert twice before. All you doomers and gloomers against Dish should take a wait and see attitude . Dish is the fastest growing sat provider out there. Dupe #3 on Rupert might just be in the works. And all of us are going to benefit from this rivalry between the two of them. Who knows what might be in the future because of this competition new channels in HD, lower prices? This might be and exciting time for Satellite for both companies.

[Randy_B]

I agree with Mike, this will be more than just business competition. A little bit of " its personal" in this market now!

[invaliduser88]

Rupert in control of Direct TV good bye true HDTV on Direct TV! Consumers only want 480p right?

[Jacob S]

If Direct raises prices then who will look like the best bet to go with as a new subscriber? Who will start switching from one provider to another? The Direct customers will and Charlie may even get a bounty against them. Can you imagine the war that we may end up having?

Maybe they will treat the retailers better and get some of Dish's retailers. Maybe it will be worse, who knows. Only time will tell.

Also are they really allowed to use all of their satellite assets overseas to use for services here and vice versa? If so this will become a HUGE disadvantage to Charlie. Will Murdoch have the same goals or better goals with locals than the what the goals were? I also wonder if there would be a change in encryption.

What type of changes happened after he took over the foreign satellite companies? This could give us an outlook at what could happen here.

[tnsprin]

Dish already sells more PVR's then TIVO and Replay. I don't see why they would bother buying Replay.

[Jacob S]

They could be better off to use that sum of money on improving their pvr's, lowring their price to sell more, to advertise them more, or adding more features.

[platinum]

Originally posted by tnsprin
Dish already sells more PVR's then TIVO and Replay. I don't see why they would bother buying Replay.

Because E*'s pvr's are full of bugs

[Curtis0620]

No more FOX on DISH. No big deal, right?
I expect the next MLB contract to be exclusive to D*.

[jrbdmb]

Originally posted by Curtis0620
No more FOX on DISH. No big deal, right?
I expect the next MLB contract to be exclusive to D*. No more Fox O&O's on Dish, no more Fox RSN's on Dish, no more Fox News on Dish, etc. It could get ugly ...

[Scott Greczkowski]

The DOJ would be all over Rupert if that were to happen. Rupert has to be very carefull what he does and I do not expect the Fox family of channels to be used against Charlie (Or anyone else)

[Curtis0620]

He's not going to withhold them, Charlie won't agree to the same price that D* is paying.

[Randy_B]

Scott is correct. IF he even HINTED that he was going to withold Fox O&O or even Fox affiliated from Dish, the FCC and DOJ would squash this buyout so quick Rup would get the bends! Rupe will have to find a completely separate area to fight with Charlie.

[raj2001]

Originally posted by Scott Greczkowski
What I believe is Charlie needs to get off his butt and show why he is the best satellite provider.

No Scott, Charlie has to become the best satellite provider. He is not that right now.

[DCSholtis]

Scott and Randy IMO Rupe has said all the right things so far....that there will no be no exclusive deal etc. Mark my words however, as far as sports contracts and maybe his Fox holding he is going to make life for Charlie as rough as possible..He just isnt going to pull a Charlie act and start antagonizing the Feds right away like Ergan did....so of course Rupe wont say anything controversial like that....But wait until that merger is ok'd then let the games begin...This is going to get real personal between those 2.

[Rick_EE]

Are we going to get a Rupert chat? Rupert Rap?

[Jacob S]

If Rupert was willing to pay extra for DirecTv then he has been having some plans for it for a good while now.

[Marcus S]

Actually, Rupert got *D for a bargain compared to E*'s rejected overpriced offering. Well, doesn't Media already own *D's 1 110 satellite @ 110 and Media leases it back? How soon we forget. Nor has the announcement greatly effected Media stock vs the up's and down's (day trading) that occurred when E* announced the same.

[Richard King]

No more Fox O&O's on Dish, no more Fox RSN's on Dish, no more Fox News on Dish, etc. It could get ugly ...Let's be logical here. Fox O&O and Fox News are advertising supported as well as subscription fees. I don't think they want to tell their advertisers that they will no longer be seen by over 8,000,000 sets of eyeballs. Ditto to the RSN's.

[Jacob S]

That is true, 8 million lost viewers and a loss in money received by Dish for the channels would hurt them more than it would help.

[jrbdmb]

Originally posted by Rking401
Let's be logical here. Fox O&O and Fox News are advertising supported as well as subscription fees. I don't think they want to tell their advertisers that they will no longer be seen by over 8,000,000 sets of eyeballs. Ditto to the RSN's. But Rupert could take that loss if in return he gets some of those 8M to switch to DirecTV ...

Realistically (as noted above), he can't just withhold his channels from cable companies and Dish. But you can bet the price paid by D* for these channels will be a lot more attractive than the price offerred to his competitors. E* in particular, with no vertical integration, could be squeezed big time.

[Casey]

curtis has it right. its not that fox will refuse to deal with dish...its that fox will raise prices for fox programming to both directv and dish...and, with fox being vertically integrated, well, the pain will be much, much higher for dish. whatever directv pays for fox programming will go to directv's parent company, fox. (from the left pocket to the right one.) whatever dish pays will also go to fox! good job, curtis. a lot of people miss this point...

[Sherlock]

I think the regulators will stipulate that the price increase scenario above won't happen. They know that increased costs for programming will go from Fox's left pocket into Fox's right pocket nullifying any real cost to DirecTV for an increase. That would still fall under predatory pricing. It will be interesting to see the comments from the regulators.

[Jacob S]

I do not think that would be legal and they would see this as obvious.