Print 25 comment(s) - last by timmiser.. on Oct 18 at 7:36 PM

This photo shows one of EchoStar's 10 satellites being launched into orbit from a floating platform at the equator.  (Source: EchoStar Communications Corp.)
The biggest U.S. phone company may be contemplating a buyout of EchoStar, the nation's No. 2 satellite TV provider

Hoping to boost its disappointing pay TV operations, phone giant AT&T is stepping up its courtship of satellite TV provider EchoStar, according to Wall Street insiders.

CitiGroup analyst Jason Bazinet handicapped the possible buy-out this week in a published report, stating that there is now a 65 percent chance that AT&T will consummate the EchoStar deal within a year. subsequently reported that AT&T hired investment banker Goldman Sachs to orchestrate the deal, which Bazinet currently values at $65 per share.  The story caused EchoStar stocks to surge up $2.04, or 4.2 percent,  to $51.08 per share at the close of trading on Oct. 17.

"The deal would make sense for both companies," noted TV industry analyst Phillip Swann.  In a report posted on his Web site, Swann said the deal could come at the right time, "with AT&T struggling with its TV service called U-verse and EchoStar facing competition from companies with deeper pockets such as DIRECTV."

EchoStar's Dish Network satellite TV service added 480,000 subscribers during the first six months of 2007, raising its total subscriptions to 13.6 million. So far, AT&T has only managed to attract about 100,000 subscribers to its U-verse pay-TV service.

The likelihood of AT&T buying EchoStar is not without its critics. In its Deal Journal blog,  the Wall Street Journal stated, "we don’t expect AT&T will be pulling the trigger on a purchase of the $23 billion satellite TV company any time soon." The article went on to state that The Street's report of Goldman Sachs having been hired by AT&T to explore the deal "looks dubious."

Comments     Threshold

This article is over a month old, voting and posting comments is disabled

By zombiexl on 10/18/2007 7:40:13 AM , Rating: 2
AT&T used to have cable companies. They sold them to Comcast (at least mine) and now are tyring to re-ente the market (althogh differently). Then there was the
AT&T->Cingular->AT&T thing.

RE: AT&T sure does like to exit and then re-enter markets
By cbo on 10/18/2007 8:13:02 AM , Rating: 3
Yeah I found that cell phone flip flop to be strange also. Maybe it was some business logic to it. But I wonder if they will keep dish customers happy with the same level of satisfaction they are accustomed. I was very close to switching to dish from directv but I stayed now that directv has started to deliver on one of its two promises 100 HD channels( now that fabled on demand feature please!). In my opinion dish had better equipment and from what I heard better service reps. AT&T meh.

By zombiexl on 10/18/2007 8:39:39 AM , Rating: 2
I've had Dish, DirecTv and the old VOOM. Voom really went out of their way to make customers happy, but then they sold off to Dish and I decided to go back to cable. Out of Dish and DTV, DTV service was far better for me.

To be fair there was a billing mistake from Dish that took 6 months and a lawyer to resolve, so that might be why i have bad feelings towards them.

By mcnabney on 10/18/2007 12:58:13 PM , Rating: 2
I recently left Dish and returned to Cable.
Dish was okay. The DVR package was alright.

There biggest problem is that their local channels (network channels) do cost extra and are also HIGHLY compressed. Super grainy, motion artifacting, and color degraded. If you like watching what the networks are showing you will be unhappy with the satellite solution.

Oh, and when it snowed/stormed there is a good chance of losing signal. Happened 3-4 times a year, but those were the times that I really wanted to know what the news was saying about the storm.

By Spivonious on 10/18/2007 8:37:34 AM , Rating: 3
Today's AT&T is not the same company as before. It's SBC with a different name.

By TomZ on 10/18/2007 9:12:14 AM , Rating: 2
It still has the same "bulldozer" attitude towards it customers, just like the old AT&T. Continued consolidation in this industry will continue to harm competition and customer choice, and we will continue to see prices rise. It's not a good situation for consumers.

By Suomynona on 10/18/2007 9:40:31 AM , Rating: 3
Yeah, it's kind of disturbing to see Ma Bell slowly reforming. Did we not learn anything the first time?

By mcnabney on 10/18/2007 1:03:20 PM , Rating: 1
Competition only exists through cable.

VoIP - either DSL (from them or cable)
Wireless - the two largest wireless companies are owned outright (AT&T) or majority owned (VZW) by AT&T and Verizon.

By AntiM on 10/18/2007 10:13:52 AM , Rating: 2
What ever happened to anti-trust laws ?? I don't know why we even bother paying taxes to a government that does very little to look after our best interests. I suppose I'm jumping the gun, the deal hasn't been officially announced, and surely it would be rejected by the FTC. Of course it would!

By masher2 on 10/18/2007 10:56:09 AM , Rating: 2
> "surely it would be rejected by the FTC. Of course it would!"

Why would it be? DISH competes with DirecTV, cable companies, and OTA stations....none of which are owned by AT&T. This acquisition doesn't reduce the level of competition in the least.

By AntiM on 10/18/2007 12:20:22 PM , Rating: 2
Why would it be? DISH competes with DirecTV, cable companies, and OTA stations....none of which are owned by AT&T. This acquisition doesn't reduce the level of competition in the least.

What? A cable TV provider (AT&T U-Verse) buys a satellite provider. Lets say AT&T buys DISH and Verizon buys DirectTV. You go from being able to choose from 4 different media providers to 2. Granted, neither company currently has significant presence as a cable provider, but that will rapidly change. I don't hear TimeWarner talking much about expanding or upgrading. OTA just isn't much of a factor anymore. AT&T already controls much of the telecommunications infrastructure and shows no signs of slowing down. I don't like it, I don't think it's good for the American consumer. Too much consolidation is a bad thing.

By masher2 on 10/18/2007 12:37:56 PM , Rating: 2
> "Lets say AT&T buys DISH and Verizon buys DirectTV. You go from being able to choose from 4 different media providers to 2."

AT&T isn't really a media provider at the moment. U-Verse has all of what, 100K customers at the moment? That's 0.03% of the US population...too small to even mention.

Even DISH itself only has some 13M customers. Compared to cable, its a bit player. AT&T purchasing it can potentially generate enough synergies to turn it into a viable choice for more people, thereby increasing competition, not reducing it.

If you want to worry about consolidation in the media provider industry, look for acquisitions by Comcast. Combine all four of AT&T, Verizon, Dish, and DirecTV all, and you get roughly the same number of customers that Comcast has all by itself.

By Oregonian2 on 10/18/2007 1:53:12 PM , Rating: 2
I've never even heard of u-verse before! Not sure if that "counts".

Verizon buying directv would be bad, they are direct competitors. I use directv now, and plan to hook up to FiOS soon (although not for the TV service) which offers fiber-cable TV.

By UNCjigga on 10/18/2007 2:10:49 PM , Rating: 2
AT&T is probably looking at DISH as a way to provide "triple-play" or "quad-play" service plans beyond the reach of fiber. They are behind the ball compared to Verizon FiOS in terms of FTTP network rollout, and they probably realize that even 5 years from now they will still be limited to the top 50 metro areas in the US. Rather than lay costly fiber in rural areas (where they won't recoup their investment) they'll use satellite instead.

Of course, companies have been offering phone+DSL+satellite packages for awhile now (Verizon partners with DirecTV in some areas.) But by owning DISH outright, AT&T will have much better bargaining power when making content deals than if they were a pure IPTV service in limited markets, and thus the channel lineup for either customer (satellite or IPTV) will be very similar.

By Screwballl on 10/18/2007 10:55:35 AM , Rating: 2
Microsoft has their grip on the OS market with Mac trying to work its way up unsuccessfully.
EA has a death grip on much of the gaming market with a few coming up behind.
Right now Google and Yahoo are fighting and it seems Yahoo is going outside of just search engine and advertising... Yahoo is mixed in with quite a few other companies now including AT&T, SBC, Cingluar among others.

By lumbergeek on 10/18/2007 12:14:42 PM , Rating: 2
Mac is NOT trying to work it's way up in the OS market. If they were, I would be happy. Mac is still locking itself to Apple-only hardware. If I could install OSx on my personally-built PC, I would. Of course, then they would have to make drivers available for 3rd party hardware. Apple could do it, but they're plain chicken.

By Oregonian2 on 10/18/2007 1:54:55 PM , Rating: 2
Yes, Apple is a hardware selling company. Microsoft is a software selling company (even if both sell a some of the "other").

By AlexWade on 10/18/2007 8:43:57 AM , Rating: 2
What about AT&T's cable TV over internet venture? I know that AT&T was looking to fiber to people's homes in Raleigh to deliver cable TV.

By Cobra Commander on 10/18/2007 9:08:16 AM , Rating: 2
Hmmm... not knowing your local areas I'm pretty sure AT&T very quickly and publicly stated they would not invest into Fiber for the southeast. Are you sure it's not just BellSouth/AT&T running Fiber to your street and the street's builder/developer converting that to copper? BS has been doing that for a long time, but that is logisticaly very, very different from say Verizon's FIOS rollout.?

By grenableu on 10/18/2007 11:58:20 AM , Rating: 2
AT&T is running FTTN (fiber to the node). The last half-mile or so to the customer premises is copper.

By Oregonian2 on 10/18/2007 1:57:21 PM , Rating: 2
Think that's called "Cable". Even DSL delivery is probably fiber to the neighborhood local dslam (then copper pair from there) in newer neighborhoods.

No I dont want this
By AlphaVirus on 10/18/2007 9:54:33 AM , Rating: 2
I like Dish Network and I feel if ATT gets any grip on EchoStar...well lets just say I dont have a good feeling about this. If ATT can barely run their own cable service, what makes them think they will help an already great service?
The only good thing ATT could bring to the table is more money but having the #2 spot I dont think EchoStar would need that anyways.

ATT stop bulldozing into every different market, please!

RE: No I dont want this
By timmiser on 10/18/2007 7:36:48 PM , Rating: 2
I completely agree with you!!!

AT&T Have been partners for a while
By Dfere on 10/18/2007 10:50:26 AM , Rating: 2
In my area. I had Dish bundled with AT&T DSL. Loved Dish, hated the DSL bundle ("Lets see, you need , uh basic $ervice, uh, Local Long Distance $ervice, and uh, of course Long Distance $ervice to get D$L" "You have a cell phone? No matter, you still need to choose one Long Distance $ervice" "and uh you also need to choose a Premium Package too".
On the plus side, they even had integrated billing (which seemed like AT&T ran). And they gave me a slight discount on my cingular phone.

"A lot of people pay zero for the cellphone ... That's what it's worth." -- Apple Chief Operating Officer Timothy Cook

Copyright 2016 DailyTech LLC. - RSS Feed | Advertise | About Us | Ethics | FAQ | Terms, Conditions & Privacy Information | Kristopher Kubicki