December 7, 2007
Echostar Splits into 2 companies, lots of fodder for speculation
Echostar’s Charlie Ergen is up to something. It’s hard to know exactly what to expect, but the company is making some interesting moves, and we’ll be watching and reporting on them.
EchoStar, the satellite broadcasting company, is finally changing its name to DISH Network, according to a filing with the SEC. Why the change? EchoStar wants its name to truly reflect its true business. It is also planning to spin off some of its businesses, and that spin-off will be called EchoStar Holding Co. (EHC), a move we had mused about earlier. Charlie Ergen is going to be chairman and CEO of both companies. EHC had sales of over a billion dollars and a profit of about $32 million for first six months of 2007, on a pro forma basis. (from Gigaom)
One big question is which of the new companies will be the bidder for 700MHz spectrum. The Echostar holdings ending up with the satellites, fibre optic network and data centers, it could leverage existing assets into a broadband business. Frankly I don’t see a fit with Dish Network other than the fact they have an exiting customer base to market a “triple play” to if they had access to a decent pipe. An AT&T deal for the Dish assets still makes sense if it comes sans the wireless broadband since AT&T has had great difficulty in securing a customer base for their IPTV offering.
Comments on Echostar Splits into 2 companies, lots of fodder for speculation »
Dr. Dog @ 7:59 pm
Interesting question there Boss. But I see a problem for Echo. There is what is called the entity definition rule. Ie the bidder must be fully defined at the time of the bid and have intent to operate under that guise. The point being to prevent a ’strawman’ bid via third party proxy. So the FCC might get really pissed and just disqualify Echo entirely or separately from the auction.
Really, really bad timing on their part in my view.