Personally, I think it's going to happen...just not for another 3-5 years. With Verizon/SBS getting into the video market and helping to freeze or reverse cable price increases, it is only a matter of time before the DBS market stops growing and perhaps begins to dwindle. Shrinking profit margins will force DBS to cut costs, and reducing the costs of maintaining their fleet of satellites and uplink facilities will be high priority.
Currently, most people being served by cable have only a single choice of providers (90%); in essence people have no cable choices if DBS isn't a viable option. The DBS market has been growing in leaps and bounds the past several years, but those days are coming to an end. Verizon/SBS will offer consumers an additional video choice and will change the competitive landscape. The FCC/FTC will be hard pressed to deny a future E*/D* merger when market share and profits dry-up and consumers, in general, have more video choices (cable, telco, DBS, IPTV?). If nothing else, I can see a possibility of D* and E* being allow to partner future satellite and uplink facilities while still maintaining their own autonomy. Let's look at HD LIL for example: why in the hell should E* and D* maintain a fleet of satellite to provide something the majority can receive with a simple OTA antenna? Without getting into a pissing contest over OTA, E* and D* both having to provide seperate HD LIL is financial suicide IMO. In any case, it should be interesting to see what the landscape looks like in 2010.