Latest Attempt To Save EchoStar/DirecTV Deal Involves Cablevision
from the no-surprise-there dept
Just as Wired went to press saying that the EchoStar's likely failure to acquire DirecTV means that Charlie Ergen will get to battle Rupert Murdoch yet again, the Washington Post is reporting that Ergen has worked out a deal with Cablevision to buy some EchoStar assets, in order to manufacture a satellite TV competitor out of thin air. The Cablevision deal had been rumored for some time, and Cablevision had announced some incredibly weak plans to offer satellite TV (some rumors said they got backing from Murdoch...). It's still unclear if EchoStar will get approval, though. I still wonder, though, why the FCC and the Justice Department don't realize that satellite TV and cable TV are competitors. They keep saying that the combined EchoStar/DirecTV would lead to a monopoly... It doesn't. How many people do you know who have both satellite TV and cable TV? The two are clearly substitutes in the same market.
Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.
Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.
While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.
–The Techdirt Team
Reader Comments
Subscribe: RSS
View by: Time | Thread
Wrong monopoly
When DirecTV (Hughes) originally launched, you had to sign up with two different companies if you wanted basic channels AND premium channels. That way there were two 'different' satellite companies vying for your business. After Dish Network (Echostar) launched, DirecTV was able to combine the two 'different' companies into one big company.
Right now if you want to sign up for small dish satellite service, you have two options, Dish Network or DirecTV. If the deal had gone through, you would have had only one choice - DishDirecNetworkTV - like or leave it. That would make them a monopoly, and that's not acceptable (to the government).
[ link to this | view in thread ]
Re: Wrong monopoly
[ link to this | view in thread ]
Re: Wrong monopoly
I think the fcc is more concerned about a monoply in markets where satellite is the only choice. Many rural areas have no cable service. But I don't know if that market is big enough to warrant killing the deals.
[ link to this | view in thread ]
Re: Wrong monopoly
While I sort of agree with you here, liken it to this, if ATT was the sole cable company out there, thats a monopoly, even if Satellite is a choice, its still a monopoly. It works the same way if you choose to go with Satellite you need a choice, and like the other poster said, there are areas where cable is not available, and simillarly areas or situations satellite is not a option.
Jeff
[ link to this | view in thread ]
Re: Wrong monopoly
Thanks for the comment. I see where everyone is coming on this, but I don't agree... with the possible exception of the few areas where cable is not available.
Here, let me explain. Based on the argument that everyone seems to be making, then a monopoly is all in the definition that some random person chooses for the market. I could say that the Burger King down the street from me has a monopoly on Burger Kings... even though there's a McDonald's across the street.
That's not right. A market is defined by the products that a consumer decides between. People decide between McDonalds and Burger King. They decide between cable and satellite.
Just to make the point even clearer... the fear on all this is that EchoStar will raise its prices. If that happens then fewer people will sign up for satellite, and, instead will sign up for digital cable - because most consumers see those two things as substitutable products... thus, meaning there is no "monopoly" on satellite (except in the regions where no cable is available).
If someone has data on how large those regions are, I'd like to see it. That might convince me that the FCC is right in blocking the merger. Otherwise, I still think they're being silly.
[ link to this | view in thread ]