DirecTV and Dish Network Merger
The Merger

In October 2001, General Motors Hughes (DirecTV's parent) and EchoStar Communications Corp., trader of Dish Network agreed to a merger. The merged company would have provided an enhanced television experience by adding at least a dozen high definition TV channels and new interactive features such as expanded pay-per-view selections and video-on-demand service. In addition all satellite TV customers would now have been able to receive local channels.

On the other hand, when merged, the new company would have resulted in a virtual monopoly of the Satellite TV industry. This would have meant that the 25 to 35 million Americans who don’t have access to cable networks would have had only one choice for the Pay TV programming. This issue is still a contentious one.

EchoStar argue that the merger is needed to be able to compete against the cable TV Giants. New statistics show, however, that satellite TV is growing very fast while cable TV is loosing clients. Out of every 3 new cable/satellite TV clients, 2 are now opting for satellite TV.

The merger would also create a monopoly position for broadband internet services in areas that are not served by DSL or cable, the only alternative to broadband internet services is via satellite.

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