Ergen Throws in the Towel - TvTechnology

Ergen Throws in the Towel

Possibly ending a yearlong battle to take over satellite TV competitor DirecTV and its parent, Hughes Electronics, EchoStar CEO Charlie Ergen issued a statement that read like a concession speech after the Oct. 31 rejection of the proposed merger by the Justice Department. But like a candidate voted down, Ergen indica
Author:
Publish date:

Possibly ending a yearlong battle to take over satellite TV competitor DirecTV and its parent, Hughes Electronics, EchoStar CEO Charlie Ergen issued a statement that read like a concession speech after the Oct. 31 rejection of the proposed merger by the Justice Department.

But like a candidate voted down, Ergen indicated EchoStar remains committed to its cause - in this case, of merging to a satellite near-monopoly in order to bring vastly improved services.

"We continue to believe passionately that the merger of EchoStar and Hughes is the best chance to stop rising cable prices and to bring enhanced services to all Americans, especially those consumers living in rural America," read Ergen's statement after it thanked customers employees, legislators and regulators. "EchoStar will continue to explore all possible means to be allowed to compete against the cable giants and for more choice for all consumers."

Justice's civil suit blocking the merger on antitrust ground follows an Oct. 10 FCC refusal of the deal. The suit effectively ends Ergen's efforts, for now, to buy his rival.

"This merger would give EchoStar control of the skies for the provision of video programming by satellite, leaving customers to suffer from the resulting reduction in competition," DOJ Antitrust Division head Charles A. James said in a release. "This merger would create a monopoly in those areas where cable television is not available, thereby eliminating competitive choice for millions of households."

Ergen tried to salvage the deal with an eleventh-hour proposal to transfer licenses to Cablevision Systems Corp. for its planned Rainbow DBS offering, but DOJ said it doubted the new satellite player would be a significant competitor to the merged company anytime soon.

The end of the EchoStar effort clears the way for rival suitor News Corp. to try to acquire Hughes. But Rupert Murdoch's company has not made recent public indications of its plans.