Satellite Merger Faces New Round of Opposition

In another salvo in the battle over the proposed EchoStar-DirecTV merger, the National Association of Broadcasters reiterated its opposition to the deal, telling lawmakers that even with the concessions the merger's proponents have offered, consumers will lose. The heart of the objections continues to be that a satell
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In another salvo in the battle over the proposed EchoStar-DirecTV merger, the National Association of Broadcasters reiterated its opposition to the deal, telling lawmakers that even with the concessions the merger's proponents have offered, consumers will lose.

The heart of the objections continues to be that a satellite monopoly could exploit rural consumers - as many as 25 million - for higher rates, EchoStar's promise of "nationwide pricing" notwithstanding.

"The company has admitted before Congress that it would abandon universal pricing in markets where it faced competitive pressure from local cable operators," NAB said in the letter, joined by the American Antitrust Institute, the American Cable Association, the National Rural Electric Cooperative Association and other groups.

Even if the new mega-provider kept nationwide pricing, anti-consumer abuse could still happen, the groups said.

"The company could potentially increase subscription rates (universally) to squeeze profit from rural customers," the groups said. "Under this scenario, the company might be willing to sacrifice some of its urban subscribers to cable in order to maximize profit from those 'captive' consumers."

In addition, the groups said that a satellite monopoly would give the provider less incentive to prevent or correct problems in billing and service.

In a separate statement against the merger, the Coalition of Christian Broadcasters said that EchoStar has consistently opposed policies that have been essential for the growth of religious broadcasting. The coalition said it would present the Justice Department petitions with 1.5 million signatures of people opposing the merger.

EchoStar has said the merger would help consumers by providing a more robust alternative to local cable monopolies. It has said that the added bandwidth provided by combining the companies would offer a wider range of services, including more local stations - something NAB has consistently advocated.