EchoStar Communications Corp. chairman and CEO Charlie Ergen said Wednesday
that cable operators are 'licking their chops' at the prospect of gaining ground
on the direct-broadcast satellite industry while the merger with DirecTV Inc. is
pending before federal regulators.
'Cable is licking their chops even when you combine these two companies
because we do go through a long regulatory [process] where they can pick off our
customers,' Ergen said a small press breakfast in Washington, D.C. 'So, of
course, they are licking their chops, and they are a formidable competitor.'
On Oct. 29, EchoStar announced a $25.8 billion merger with Hughes Electronics
Corp., parent of DirecTV -- a deal that would give the new company at least 14.9
million subscribers and about 17 percent of the pay TV market.
Ergen said he expects to file for merger approval with the Department of
Justice and the Federal Communications Commission within two weeks.
He added that he expects approval based on the multiple benefits the merger
would provide consumers, particularly in rural areas.
After the deal was announced, the National Association of Broadcasters called
on the federal government to give it a high level of review.
Ergen said the NAB wants to challenge the deal because TV stations view DBS
as a future competitor, especially if broadcasters intend to use their
digital-TV licenses to introduce pay TV services.
'Our biggest competitor in the future may be the broadcasters. I expect that
broadcasters will fight this merger in every way because they may also want to
be in the subscription-television business,' Ergen said.
'You could imagine a [broadcast] multichannel-video provider in New York with
250 channels competing with Dish Network,' he added.