Dish Network CEO: Merger with DirecTV 'Will Be Inevitable'

Stephen Silver

Technology,

“Could that be a month from now or 10 years from now? That I don't know…. obviously I've said in the past, I thought I would be inevitable that DISH and DIRECTV probably at some point would be allowed to merge and that would reduce need for satellites as well.”

When it announced its quarterly earnings last week, it revealed that its core Dish Network service lost about 40,000 subscribers, while Sling TV lost 56,000. The losses weren’t as steep as what the company announced in the first quarter when the company lost a total of 413,000 subscribers, but it continued their decline.

The company did post a profit of $452 million, on a profit of $3.19 billion, while Dish has completed its acquisition of Boost Mobile, which represents a pivot for the company into 5G service.

So what will become of the Dish Network service? On the company’s earnings call, CEO Charlie Ergen once again reiterated that Dish won’t be launching any more new satellites- and that he still thinks it’s “inevitable” that the two satellite companies will eventually merge.

“Yeah, I mean, I still think DISH and DIRECTV will be inevitable,” Ergen said on the earnings call, per a transcript published by The Motley Fool. “Could that be a month from now or 10 years from now? That I don't know…. obviously I've said in the past, I thought I would be inevitable that DISH and DIRECTV probably at some point would be allowed to merge and that would reduce need for satellites as well.”

The two satellite companies have come close to merging on multiple occasions over the years. In 2001, Dish’s then-parent company, EchoStar, agreed to acquire DirecTV, although the merger fell apart the following year amid opposition from government regulators.

Earlier this year, Fox Business reported that AT&T is under pressure to sell DirecTV, in order to cut its debt load, and floated a scenario, similar to one reportedly under consideration last fall, in which AT&T would offload DirecTV and merge it into a new unit with Dish. No such deal has taken place, at least not as of yet.

Per Deadline, antitrust regulators have indicated over the years that they would oppose such a merger, but the satellite business has been shrinking significantly, especially since the time of the failed merger in 2001. In addition, per that report, MoffettNathanson has reiterated its “sell” rating for Dish, since the growing government support for rural broadband access will likely cut into Dish’s traditional base in rural areas.

Stephen Silver, a technology writer for The National Interest, is a journalist, essayist and film critic, who is also a contributor to Philly Voice, Philadelphia Weekly, the Jewish Telegraphic Agency, Living Life Fearless, Backstage magazine, Broad Street Review and Splice Today. The co-founder of the Philadelphia Film Critics Circle, Stephen lives in suburban Philadelphia with his wife and two sons. Follow him on Twitter at @StephenSilver.

Image: Reuters.