EchoStar/Dish raises doubts about 'ability to continue as a going concern'

[ekilgus]

I just read this:

Dish and Sling TV Revenue Collapses, Down a Record 10% in Q2​

Revenue for Dish Network and Sling TV was collectively down a record 10% year-over-year, according to parent company EchoStar’s second quarterly earnings report. EchoStar posted $2.67 billion in pay TV revenues, down from $2.97 billion a year ago.
At the close of the quarter, the subscriber base for Dish’s core satellite-TV business was shrinking at a 12% rate, worse than the 11.8% decline at the end of last quarter.

Yet, I'd wager price increases are still in our future.

 

[CSM]

What if AT&T does sell their 70% DTV stake to some company, would that company want to buy Dish Network and merge them? Right now, it is past the date that AT&T can get out of that 70% stake. Maybe the new company would pay for that new satellite that Dish Network contracted for. They could also merge Sling TV with DirecTV via Net and DTV Stream into one streaming service and have new pricing for that.

 

[Radioguy41]

So they will have to give more of their money, after losing hope of ever getting back any of the money that was already invested, but will get a piece of a company, who’s value gets less and less with every reported quarter.

Kinda sounds like DirecTV, doesn't it, yet they managed to find some silly investors to buy the Titanic after it had hit the iceberg. 🤑

 

[Bruce]

What if AT&T does sell their 70% DTV stake to some company, would that company want to buy Dish Network and merge them? Right now, it is past the date that AT&T can get out of that 70% stake. Maybe the new company would pay for that new satellite that Dish Network contracted for. They could also merge Sling TV with DirecTV via Net and DTV Stream into one streaming service and have new pricing for that.

First, DirecTV is carrying $10 Billion in debt, Dish/EchoStar total liabilities of $35 Billion, which includes debt of over $20 Billion.

So that means a new company buying both DirecTV and Dish would have to assume that much debt, plus the cost of the two companies, in return for them, a decreasing amount of millions ( not billions) of dollars in net revenue.

 

[CSM]

First, DirecTV is carrying $10 Billion in debt, Dish/EchoStar total liabilities of $35 Billion, which includes debt of over $20 Billion.

So that means a new company buying both DirecTV and Dish would have to assume that much debt, plus the cost of the two companies, in return for them returning a decreasing amount of millions ( not billions) of dollars in net revenue.

Good point about assuming both debts.

 

[Tvland1]

I'm starting to wonder what it's going to take for reality to sink in...There's not going to be any merger of any kind people 😀

 

[MitchDeerfield]

What if AT&T does sell their 70% DTV stake to some company, would that company want to buy Dish Network and merge them? Right now, it is past the date that AT&T can get out of that 70% stake. Maybe the new company would pay for that new satellite that Dish Network contracted for. They could also merge Sling TV with DirecTV via Net and DTV Stream into one streaming service and have new pricing for that.

There will be no combination approved with the Democrats in power. They are very much opposed to big mergers due to anti-trust concerns. Maybe after Dish goes bankrupt.

 

[CSM]

There will be no combination approved with the Democrats in power. They are very much opposed to big mergers due to anti-trust concerns. Maybe after Dish goes bankrupt.

The government could allow it because satellite has more competition with the streaming services and maybe they wouldn't want to see Dish go since it also provides TV to rural customers who don't have high speed internet. However, there still is what Bruce said about a company wanting to assume both debts. I guess they could also be waiting until after the election to do anything?

 

[Yespage]

There will be no combination approved with the Democrats in power. They are very much opposed to big mergers due to anti-trust concerns. Maybe after Dish goes bankrupt.

The financials and future of the sat industry as well as paid TV in general will weigh a lot more on mergers or buyouts than anything in DC. Directv is a dead duck. Echostar is trying to be a 5G leader, where 5G has not quite been as 5G was advertised. They have a potential future, but a ton of debt to assume. And I'm not certain how this works regarding the spectrum.

Google, Amazon, Apple would be the few with the ability to absorb such debt. I don't see Apple doing it, and Amazon and Google don't really need to do it.

 

[syphix]

There will be no combination approved with the Democrats in power. They are very much opposed to big mergers due to anti-trust concerns. Maybe after Dish goes bankrupt.

Sirius and XM merged in 2008 when both the House and Senate were controlled by Democrats.

 

[AZ.]

There will be no combination approved with the Democrats in power. They are very much opposed to big mergers due to anti-trust concerns. Maybe after Dish goes bankrupt.

Thats why we have 6 media companies that control 90 of all radio and tv. 6 major grocery chains in the whole country. Its been out of control, and the last time anyone stepped in it was ATT in the 80s.........Lots of mergers should have been stopped. It ends up costing the regular people hard earned money, with so much in such few hands!

 

[navychop]

I see no reason for Dish or anyone else “assuming” DirecTv. Let them die, and many/most of their customers will come to Dish. Orbital slots might be picked up for a song, as who else wants them and ka ku?

 

[Nebugeater]

So what do you advise Charlie to do in this situation? Should he sell off his cell phone business , towers, spectrum ? Makes the debt problem go away, but he is still going to lose his satellite business sooner than later. Sling TV isn't enough to keep him afloat. How does he make his remaining company profitable for the long term?

Follow the same plan they implemented with the Blockbuster.....
Oh, never mind.....

 

[dishdude]

Follow the same plan they implemented with the Blockbuster.....
Oh, never mind.....

Good analogy, satellite and cable are the modern day equivalent to a video rental store.

 

[MitchDeerfield]

Sirius and XM merged in 2008 when both the House and Senate were controlled by Democrats.

You gotta be kidding. Mergers in that year were regulated by George W. Bush's Justice Department. The Democrat Congress had nothing to do with it!
Please tell me that you are kidding.

 

[Scott Greczkowski]

Folks please keep the political stuff in the pit. Thanks.

 

[nelson61]

Google, Amazon, Apple would be the few with the ability to absorb such debt. I don't see Apple doing it, and Amazon and Google don't really need to do it.

You got me thinking.
Maybe Starlink.
I can envision a space-land based wifi or cell system which could provide seamless, robust ,widely available features covering the entire country.

And they seem to have deep pockets for funding.

 

[navychop]

Interesting

 

[Teehar]

Good analogy, satellite and cable are the modern day equivalent to a video rental store.

well.....there are still many areas that don't have access to reliable,internet.Sure there is starlink but not many folks in those areas can afford it.So there is still a place for satellite tv.Maybe Amazon's satellite internet will make it more affordable but that's a long way off.

 

[Bruce]

well.....there are still many areas that don't have access to reliable,internet.

It is a myth that everyone in rural locations does not have access to Broadband in today’s world.

As of now, there are 20 Million Households in rural locations, yet there are only 16 Million Satellite TV Subscribers (both services combined ).

How many of those are in Metro or Rural Areas ?

If 40% of Satellite TV Subscribers are in Rural Areas, that is only 6.4 Million subs, what do the other 13.6 Million Rural Households get for TV Service?

By the way, I live in a rural area, Septic, Well, lots of land, I have had Charter’s 1G Service since moving here in 2020, my Fiber install is next week.