They say good things come in pairs, but in the eyes of the FCC, this isn’t always the case. About 20 years ago, Dish Network and DirecTV tried to merge into one company. This triggered a Justice Department investigation and rumors of antitrust violations. In the end, the FCC ruled that the merger would cross the lines of antitrust laws. For 20 years, both companies have survived in the age of online streaming.
Fast forward to the beginning of this year, and already there are rumors that DirecTV and Dish Network are about to start Round 2 of their quest to merge. The latest first rumor of this situation came from a New York Post article. TPG Capital is a minority shareholder and has some control over DirecTV. This is reported to be his idea to advance the merger talks.
TPG Capital leaders aren’t the only people who believe the merger will happen. Dish Network Chairman Charlie Ergen likes to call the merger “inevitable.” What’s more, many experts believe that the second round could be a resounding success for both companies. Many things have changed since his first attempt.
Antitrust laws are procompetitive and antitrust. Twenty years ago, Dish Network and DirecTV were pretty much the only options TV consumers had to choose from if they wanted to watch outside of their local cable TV companies. The FCC ruled that the similarity of Dish Network and DirecTV would form a virtual monopoly over the industry.
Oh how things have changed. Today’s television consumers have an almost infinite variety of platforms to choose from. There is Apple TV, Dish TV, Amazon Prime, Hulu, Netflix, HBO Max and many more. For those who have wireless internet, they watch “TV” on their tablets, laptops, and even smartphones. Blair Levin, policy adviser at New Street Research, believes that this time around, the Dish-DirecTV merger could have a much better chance of happening.
Says Levin: “If the antitrust authorities agree, the government is likely to view the market as significantly more competitive, and the merger is unlikely to cause an anticompetitive effect.” New Street Research is a respected independent research firm that focuses on technology like this, so your prediction may turn out to be correct.
That’s not to say there won’t be “uncertainty about its fate,” Levin says of the merger. The DOJ will surely focus on the similarity of the companies just as they did almost 20 years ago. For now though, if both companies choose to go ahead with a true merger attempt, it seems their chances of approval are much better now than decades before. The entire television industry has changed, and the nature of competition has also changed.
If the merger goes through, what will it mean for TV consumers? For the stock market, the news was positive for Dish Network. Its shares rose 3% after the initial reports. This could mean that there is a positive slant in how the public would view a merger between these two. Both would bring their own philosophies to the satellite TV market and perhaps form a strong competitor against the many streaming services that have since taken over in the last decade. Unlike last time, a merger could mean stiffer competition between TV services.
In the coming months, the talks will continue and either go ahead or break down. That is a certainty. If they go ahead, it will be up to the Justice Department whether or not it is a done deal or another false alarm. Dish Network and DirecTV remain competitors for now, competing against a whole legion of mobile entertainment. By the end of the year, they could be teammates giving TV consumers another way to binge on today’s most beloved TV shows. Decisions and news will not come quickly. As we all know, the television industry takes entertainment very seriously. And the Department of Justice takes antitrust laws very seriously.
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Categories: Technology
Source: vtt.edu.vn