Ergen waiting out Viacom (1 Viewer)

Scott Greczkowski

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Ergen waiting out Viacom
EchoStar chief discusses future
By Kris Hudson
Denver Post Business Writer



Sunday, March 07, 2004 -

WASHINGTON - Charlie Ergen rarely picks a small fight. Ergen's EchoStar Communications Corp., which delivers satellite TV to 9 million subscribers under the Dish Network brand, has taken on CBS parent Viacom in a bitter legal battle.

On Thursday, Ergen accused Viacom of "extortion at the highest level." He claims that for EchoStar to carry CBS, Viacom is pressuring EchoStar to pay for and carry many other Viacom-owned channels. Viacom has declined to comment.

Midnight Monday is the deadline for expiration of an injunction that bars Viacom from pulling its channels off Dish Network. sg If Viacom pulls the plug, Dish viewers could be missing 20 channels, including CBS, MTV, VH1 and Nickelodeon.

The uncertainty has trimmed EchoStar's stock price, which closed Friday at $34.55, down 4 percent.

An even bigger strategic issue looms for the company Ergen co-founded in Colorado two decades ago. EchoStar, based in Douglas County, may need to find a merger or acquisition partner as programming and distribution companies merge into bigger and bigger entities.

So what will become of EchoStar - Colorado's fourth-most valuable company, with a market value of $16.74 billion? No one has more influence over the answer than Ergen, who exerts 90 percent voting control over EchoStar. He fielded questions last week at a luncheon sponsored by the Progress and Freedom Foundation, a Washington think tank.

Q: If the board of the Walt Disney Co. accepts cable giant Comcast Corp.'s unsolicited acquisition bid, and federal regulators approve it, how might that affect EchoStar? Will you need to combine with another company that generates TV programming for EchoStar to deliver?

ERGEN: We'd like to be Switzerland and let our customers know they can get whatever they want. The government may not allow that. (If Comcast buys Disney) we either buy a company or sell a company, and we're down the road. But I don't think it's good public policy.

Q: EchoStar and DirecTV now are reselling high-speed Internet access offered by big phone companies. Will satellite-TV companies offer Internet access on their own?

ERGEN: We believe that satellite has a role to play in broadband in America. Initially, we believe it is more of a rural product for 10 (million) to 20 million homes.

Q: There is a deadline approaching (midnight Monday) for expiration of the injunction barring Viacom from pulling its channels from Dish Network. This stems from negotiations to extend your carriage deal, which expired Dec. 31. You say Viacom threatened to pull its programming so Dish customers would not see the last Super Bowl if you didn't agree to carry certain other Viacom channels. You also say Viacom is seeking double-digit rate increases from Dish. Have talks between the two sides progressed?

ERGEN: I'm not really feeling good about them now. The last three years, we've given Viacom more customers than the cable industry and DirecTV combined. Why are my customers paying a 10 to 15 percent premium?

If you're going to use the Super Bowl as a weapon, we don't think that's right. We're willing to point out what we think is an injustice. Our stock price may go down, and we may lose customers. But I wake up and look in the mirror and say, "I feel good about this decision."

Read the rest at http://www.denverpost.com/Stories/0,1413,36~33~1999715,00.html#
 

red hazard

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Oct 13, 2003
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Packaged Programming

"On Thursday, Ergen accused Viacom of "extortion at the highest level." He claims that for EchoStar to carry CBS, Viacom is pressuring EchoStar to pay for and carry many other Viacom-owned channels. Viacom has declined to comment. "

Exactly the same way Ergen packages his programming to customers!
 

Juan

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Sep 14, 2003
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red hazard said:
"On Thursday, Ergen accused Viacom of "extortion at the highest level." He claims that for EchoStar to carry CBS, Viacom is pressuring EchoStar to pay for and carry many other Viacom-owned channels. Viacom has declined to comment. "

Exactly the same way Ergen packages his programming to customers!
uhhh maybe this is why?
:shocked :shocked
 

sampatterson

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Sep 8, 2003
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Yeah, If I want certain channels on E* I have to buy the Top 150/180 instead of just that channel that I want. Sounds like Charlie and Viacom have more in common than he thinks.
 

GaryPen

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Scott Greczkowski said:
ERGEN: We'd like to be Switzerland and let our customers know they can get whatever they want. The government may not allow that. (If Comcast buys Disney) we either buy a company or sell a company, and we're down the road. But I don't think it's good public policy.

ERGEN: I'm not really feeling good about them now. The last three years, we've given Viacom more customers than the cable industry and DirecTV combined. Why are my customers paying a 10 to 15 percent premium?

If you're going to use the Super Bowl as a weapon, we don't think that's right. We're willing to point out what we think is an injustice. Our stock price may go down, and we may lose customers. But I wake up and look in the mirror and say, "I feel good about this decision."

Comments like that are one of the main reasons I chose E when switching back to satellite this year. I always liked Charlie compared to the average Suit. Of course, he could be FOS like a politician, but I'll give him the benefit of the doubt.

Logic dictates that a workable solution between the two companies will happen at some point in the near future, with minimal or no impact on our rates. Each company needs the other. The govt may have to step in, but that's what they're theoretically there for, to protect the people from enemies foriegn and domestic (and corporate).

I'b be willing to go a short while without the Viacom stations, but I do feel that we should be issued credits for the percentage of programming that will be missed. (Simlar to the free local pakage while SF's NBC station was pulling the same crap a coupla years ago.) I'm sure that if it comes to a Viacom blackout, E will do just that. After all, Viacom really does provide the most popular "cable" channels. It ain't just MTV.

What will parents do with Nick, Noggin, N, Nicktoons, etc? How about movie lovers with Showtime, Flix, TMC, and Sundance? Or, the heartland with Spike and CMT? There's even more! Sure, there are alternatives such as Fuse, Cartoon Network, and the superior HBO, Starz, Encore and IFC. But, removing Viacom leaves a big gap.

There's also UPN, in addition to CBS, and the 39 Viacom O&O's. Although, the FCC should step in with the broadcast issue, since their own laws say E "must carry" those stations, and ethically, Viacom shouldn't be able to tie them to it's cable/satellite packages.

Getting back on the thread, I agree with CE's stance on this issue 110%.
 

Stargazer

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If the Viacom channels get blacked out at least we would not have to see Viacom try to scroll messages across and Dish Network blotch them out with black banners across the channels.

They better be prepared to do something for the customers to make up for it. This will NOT be taken lightly. WWE fans will be very angry if they do not get their wrestling. I am sure they are going to try to scroll text all over the place on Spike TV on Monday night.
 

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