How Should Dish be compensated if Directv/At&T Merge?

[nelson61]

We have all heard the news about the BIG planned merger.

Dish will have a distinct economic and competitive disadvantage if the deal goes through.

At startup, Directv/AT&T will increase their market share, spreading their fixed costs over a much larger customer base and will surely intend to offer some type of triple play package which will allow them to capture an even larger part of the market (lowering their cost per customer and allowing them to underprice the Dish service).

How do regulators address that economic fact?

Do they force the merged companies to provide Dish access to more spectrum? An example would be leasing their three (3) 110W transponders to Dish with provision to retain a spot beam for Puerto Rico? Or maybe some of their 119W spectrum?

Do they force the merged companies to offer the ground based portion of triple play to Dish on favorable economic terms?

Do they prohibit packaging that will undercut Dish pricing so as to erode market share (like the predatory short term pricing the airlines use to keep competition out of their Hubs and then proceeding to raise prices above market when the competition folds)?

Whatever it is, they better do something or we will see Dish slowly fade away as they become less competitive. If that happens, it is probably a guarantee that those relying on satellite service will be getting much bigger (inflation adjusted bill) 10 years from now.

 

[AntiMoz]

Given the consolidation going on in the industry, either the FTC has to block the TW/Comcast and DTV/AT&T mergers or both for Dish to remain competitive.

To counter, Dish has to take advantage of the wireless spectrum they are sitting on. The rumored merger with Verizon would be one way, and probably less expensive than going it on their own. An out of the box thought would be to team up or be acquired by Google or Apple who are sitting on wads of cash and perhaps looking to exploit the wireless spectrum that Dish currently holds. Dish could use their hardware (Chromecast or AppleTV) to provide the interface for their Dish IPTV service.

 

[sparc]

The rumored merger with Verizon would be one way, and probably less expensive than going it on their own.

there is no rumored merger of Dish with Verizon. Just someone's wishful thinking.

http://www.dslreports.com/shownews/Verizon-An-Acquisition-of-Dish-is-Fantasy-129049

 

[cosmo_kramer]

there is no rumored merger of Dish with Verizon. Just someone's wishful thinking.

http://www.dslreports.com/shownews/Verizon-An-Acquisition-of-Dish-is-Fantasy-129049

All it takes is one person to speculate and that qualifies as a rumor....

 

[sparc]

All it takes is one person to speculate and that qualifies as a rumor....

up until the point that the CEO of Verizon says they haven't had any meetings with Dish and don't ever plan to get in bed with Dish. Then whomever made up that nonsense about a Verizon tie up is just some clown on the internet.

 

[mikew]

They will be compensated with a bright red ribbon.

 

[ronjohn]

If there are any anti-competitive moves or antitrust type violations, then the FTC can take action.

If a competitor can make a better product, or make an alliance that causes them to be stronger, the losing company is not entitles to anything. If they were, then I could start a business, do nothing, then claim that the companies that actually make a profit were taking my business away and should pay me.

 

[Tampa8]

That's not how it works. All aspects are looked at when a merger is considered. As one recent example, the Charter merger is more favorable because there will be no overlapping subscriber base. If there were, meaning less competition, it isn't out of the question they would be forced to give certain markets to a competitor.
So it is a real possibility should the FCC see this as anti competitive, if there are remedies they will want them in regards to DISH. That doesn't mean they will see it as anti competitive, just that if they do DISH may be awarded something.

 

[Claude Greiner]

If Dish somehow gets scrwed because they are at a competitive dis-advantage, then this merger is the best thing that could ever happen.

They (Dish) had the oppertunity to sell to AT&T several years ago and Charlie turned them down. Besides that, Dish owns enough wireless spectrum they can build out their own network. The problem is that Charlie is too cheap to spend any of his money to do it and would rather use someone elses.

 

[Bodo Fenrirsson]

It would be premature for Dish to openly discuss merging with anyone until we see if both the Comcast-TWC & ATT-Directv merger/acquisitions are allowed to go through. Until then why not have Dish Network merge with Disneyland/Disney World or Six Flags,if we're going to talk about who they should merge with(seriously I think they have a better shot with Sprint or T-Mobile than with Verizon).

 

[AntiMoz]

All it takes is one person to speculate and that qualifies as a rumor....

Charlie was the one speculating......

From the WSJ article that detailed the Verizon CEO denial, "Dish Chairman Charlie Ergen said last week it would "make a lot of sense" for his company to be acquired by Verizon or AT&T."

http://blogs.wsj.com/moneybeat/2014/05/20/verizon-ceo-calls-deal-with-dish-network-a-fantasy/

 

[Bodo Fenrirsson]

Dish Network should merge with either McDonald's or Burger King,then you can bundle free fries & a shake with your Dish order.

 

[Tampa8]

"Hopper your way" ™
Hey now I'm listening....

 

[sparc]

Dish Network should merge with either McDonald's or Burger King,then you can bundle free fries & a shake with your Dish order.

I think they'd be lucky to merge with Arby's at this point. They're pretty much odd man out. Sprint might be their only way out but I don't see Softbank giving up control.

 

[ronjohn]

That's not how it works. All aspects are looked at when a merger is considered. As one recent example, the Charter merger is more favorable because there will be no overlapping subscriber base. If there were, meaning less competition, it isn't out of the question they would be forced to give certain markets to a competitor.
So it is a real possibility should the FCC see this as anti competitive, if there are remedies they will want them in regards to DISH. That doesn't mean they will see it as anti competitive, just that if they do DISH may be awarded something.

The OP did not ask how the FTC or FCC would ensure a competitive market is still viable. The question he asked is how will AT&T be forced to compensate Dish since AT&T's is making moves that he feels will strengthen DirecTV's ability to market to consumers. If the government comes to the conclusion that this merger is monopolistic, which I highly doubt, they would either not allow the merger or look for ways to ensure competition. The government would not tell AT&T that in order to purchase DirecTv, they must pay money to Dish to compensate them.

 

[Tampa8]

Compensate;
www.merriam-webster.com/dictionary/compensate

Merriam?Webster
to provide something good as a balance against something bad or undesirable : to make up for some defect or weakness.


Money is only one of many ways.
You have assigned money to it, that is not the definition however but only one means. I never said money, nor did the OP. In fact he mentions exactly what I echoed - ways other than money that could be enforced to allow the deal that would keep it competitive, exactly the opposite of what you are saying and is what the FCC has done in the past.

 

[whitewolf8214]

Dish Network ponders options after AT&T deal for DirecTV

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Dish Network ponders options after AT&T deal for DirecTV

By Paul Taylor in New YorkAuthor alerts
Charlie Ergen

Charlie Ergen, Dish co-founder

When AT&T announced its $49bn agreed bid for DirecTV this week, the deal appeared to leave Dish Network and the company’s one time poker-playing chairman, Charlie Ergen, out in the cold.

In the wake of the deal, shares in Dish have fallen almost 6 per cent reflecting a belief among investors that the DirecTV bid, like Sprint’s potential offer to purchase T-Mobile US, in effect removes another potential strategic partner.

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But is Mr Ergen, who co-founded Dish, holding a busted hand, or could he still come out ahead in the restructuring of the US video, broadband and mobile communications markets?

Dish, now the second-largest satellite TV operator in the US, has built a sizeable spectrum portfolio by buying satellite spectrum from bankrupt companies and persuading US regulators to reclassify it for use as a fixed wireless broadband network.

Under the agreement, Dish has two years to begin building the network, find a partner to help fund the considerable capital expenditure required, or cash out and sell the spectrum.

Before the AT&T deal was announced, most analysts had thought Mr Ergen would either sell the spectrum or the whole company to an established mobile network operator, or challenge regulators by once again proposing a merger with DirecTV. Now they say his options look more limited.

“Dish Network has just been left standing,” says Craig Moffett of MoffettNathanson, who also casts doubt on suggestions that Verizon Communications, which operates the FiOS fibre-optic broadband, telecoms and TV service, could bid for Dish. “That Verizon might be a buyer is more wishful thinking than it is analysis,” he says.

Moody’s analysts agree a bid from Verizon is “highly unlikely”, adding: “Verizon would be more likely to expand its FiOS build out and invest more in content aggregation and distribution (video on demand and OTT) such as it has begun doing via its joint venture with Redbox.”
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Another option mooted by some analysts would be for Dish to counterbid for DirecTV. But Mr Ergen appeared to rule that out during a call with analysts to discuss the company’s first-quarter results 10 days ago, when he acknowledged that Dish was not in a financial position to outbid AT&T for DirecTV, or Sprint and its Japanese parent, SoftBank, for T-Mobile US

Nevertheless, Moody’s analysts argue that if Dish is to pursue its plan for a fixed wireless broadband network, its only option may be through a deal with T-Mobile US.

“The company has enough capital and financial flexibility to buy control of T-Mobile, but not enough to fund the capital that T-Mobile will need to compete with the capital spending of AT&T and Verizon Wireless, and not enough capital to build out its fixed wireless network,” they said in a note this week.

Mr Ergen also appears to see this as a possibility. Asked whether Dish would be interested in bidding for T-Mobile US if regulators blocked a Sprint bid, he said: “If Sprint didn’t proceed or was denied, then T-Mobile would have strategic interest to us.”

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Mr Ergen may be hoping that Sprint does indeed bid for T-Mobile US and that regulators reject the combination, providing Dish with the opportunity to buy control at a discounted price.

Dish would still need another deep-pocketed partner that might have been DirecTV if not for the acquisition agreement, say Moody’s analysts. “The question is: who is willing to be a partner to Dish’s controlling shareholder, Charlie Ergen, who has been known to end other partnerships in court and likes to maintain control?”

Mr Ergen is holding his cards close to his chest. Explaining his strategy to journalists last week. he said: “When I used to play poker and everybody was throwing chips and betting crazy on the table and I had really good cards, I always felt it was better just to sit back and watch them go at it?.?.?.?every time they went at it, I’d learned something. And?.?.?.?as I sat back, they didn’t learn anything about what I had. I learnt to trust my cards.”

He added: “I wasn’t a very good poker player, but when a bunch of drunken fools were throwing money around, occasionally I was able to pick up a pot at the end of the day.”

http://www.ft.com/intl/cms/s/0/06f3d574-e109-11e3-b59f-00144feabdc0.html#axzz32V2ktw1f

 

[Tampa8]

Pay site or you have to give your email address...

 

[Bodo Fenrirsson]

As I've always said,wait to see if the ATT-Directv acquisition/merger is approved before finding out what Dish does,but if the ATT-Directv acquisition/merger IS approved,ignore Verizon's denials at this time. look in the opposite direction of Verizon's denials,because they would be idiots if they didn't at least consider acquiring Dish with studying the pros & cons of doing such a deal. Verizon has Home Fusion Broadband LTE internet,which is available in a lot more places than ATT's version(at least it's in MY area,which ATT isn't). they can bundle that with Dish Network in rural areas. Of course this is all just my opinion,I'm just saying never say never about a deal between Verizon & Dish Network.

 

[whitewolf8214]

Pay site or you have to give your email address...

You have to give e-mail address but I changed it so you can read it!!