Dish pledge doesn’t help DirecTV deal

Mar 4, 2002  •  Post A Comment

The National Association of Broadcasters will continue to resist the planned merger of EchoStar and DirecTV despite a pledge by the companies to carry every television station in every market if the deal is approved.
“Broadcasters have had a long and tortured history of bad faith dealings with EchoStar and its chairman, Charlie Ergen,” said NAB President and CEO Eddie Fritts.
The deal also has sparked criticism from watchdog groups and rural lawmakers, who worry it would end competition in the direct broadcast satellite business.
“I have a lot of reservations about it,” said Senate Minority Leader Trent Lott, R-Miss., last week at NAB’s State Leadership Conference in Washington. “I’m worried that this is not necessarily going to improve service. It may weaken it even more.”
To placate federal regulators reviewing the transaction, the DBS companies said last week that they would carry all TV stations in all 210 designated market areas if the combination wins approval. Until last week, the companies had said they would have the capacity to carry local signals only in major markets.
At a briefing in Washington, EchoStar CEO Charlie Ergen and DirecTV CEO Eddy Hartenstein said carrying the signals would put them on a competitive footing with cable, giving consumers a more viable alternative for video service.
“We don’t object to somebody making that a condition of the merger, because we’re going to do it,” Mr. Ergen said. The plan could be implemented in two years at a cost of $300 million.
NAB and EchoStar have squabbled repeatedly, often in court, over a host of issues related to TV signal carriage on satellite. Another worry for NAB: The plan makes no mention of carrying the primary digital signals that broadcasters will offer as well as the multicast digital signals many will provide.
In addition, a merged EchoStar-DirecTV would not carry local broadcasters in high definition but would offer national broadcast network feeds in the format.
More than 50 African American protesters held a rally outside the hotel where the briefing occurred to demand that EchoStar reinstate the Word Network, a religious channel. EchoStar said the programmer, which is on DirecTV and would be carried by the merged company, was replaced by other minority-oriented programming.