The merger would create a company with 16.7m subscribers, bigger than the US's largest cable operator, which has 14.4m subscribers. The deal is expected to face opposition from competition regulators because it will narrow the amount of competition in the market place and would limit the choice of satellite providers for homes in rural areas.
Last week, EchoStar chief executive Charles Ergen faced opposition from US competition regulators in a hearing by the House Judiciary Committee concerned about the impact the merger of the two broadcasters would have on rural areas of the US.
Ergen, however, argued that the merger, which will see the combined company control 90% of the US satellite television market, should be judged in the context of the entire pay-TV market. This includes cable operators and providers of satellite TV using much bigger satellite dishes than those supplied by DirecTV and EchoStar.
However, this argument was questioned by the chairman of the House Committee, James F Sensenbrenner, who reminded Ergen of a filing he made against DirecTV last year, accusing it of anti-competitive practices, when he maintained that large dish providers were obsolete and declining.
Sensebrenner told Ergen to make up his mind which view he believed was accurate and to inform the court accordingly.
This meeting was followed on Friday by a ruling by the US Court of Appeals for the Fourth Circuit in Richmond, Virginia that the broadcasters must begin broadcasting hundreds of additional local channels by the beginning of next month.
The companies objected saying that the ruling was a violation of their free speech rights that would force them to tie up too many of their satellite channels.
However, the requirement could add weight to the merger's argument that only a combined satellite company would have the channel capacity to carry signals from all or most of the country's 1,500 local TV stations.
If you have an opinion on this or any other issue raised on Brand
Republic, join the debate in the .
.jpg)
.jpg)