Ergen not content to sit on sidelines with pay-TV
By Andy Vuong
The Denver Post
Posted: 02/20/2011 01:00:00 AM MST
Dish Network and EchoStar chairman Charlie
Ergen may be a satellite-television pioneer, but
these days, his children are wondering about his
line of work.
"My kids think I'm crazy for being in the pay-TV
business because they don't pay for TV," Ergen
said during an earnings call with analysts in
November, according to a transcript. "They don't
pay for movies. But they watch an awful lot of TV
and movies."
Those remarks were part of a long answer
addressing whether the video business has
changed.
With growing competition from cheaper
Internet-based alternatives like Netflix, and as
viewers look to access TV content while on the
move, the landscape clearly has changed.
Ergen isn't sitting idle, adding features such as
GoogleTV and Sling to enhance Dish's service.
And in recent months, he has proposed
multibillion-dollar moves that could reshape the
satellite-TV company he co-founded three
decades ago.
If successful, the deals would give Ergen control
of a big block of wireless spectrum at a time
when such frequencies are in short supply and
high demand.
They also would make Dish an attractive
acquisition target for telecom giants AT&T and
Verizon Communications, according to analysts,
because wireless carriers will need more
spectrum as mobile broadband usage grows.
Analysts, though, say Ergen's strategy with
wireless spectrum isn't clear.
"Is it a purely financial investment, and he's just
going to turn around and sell it over the next
couple of years?" asked Bryan Kraft, an analyst
with Evercore Partners in New York. "Or it is it an
investment . . . he might be able to use in a
partnership with a wireless operator to give him
wholesale access to a wireless network on
attractive terms?"
Ergen also may choose to build his own wireless
network, though Kraft says that scenario is
unlikely.
Ergen declined to comment for this story, with
Dish spokesman Marc Lumpkin noting that E
choStar and Dish, both based in Douglas County,
have not publicly discussed the proposed deals.