EchoStar Communications Corp. and DirecTV Group may join forces to roll out high-speed wireless Internet access in an attempt to offer a “triple play” bundle of services to subscribers.
TheStreet.com said Monday on its website that El Segundo, Calif.-based DirecTV and Douglas County-based EchoStar are in talks to build a wireless network to offer broadband services, which could add not only Internet access, but Voice over Internet Protocol telephone service to their pay-TV offerings.
DirecTV, controlled by News Corp., is the leading satellite-service provider, with 15 million subscribers. EchoStar, provider of the Dish Network, has 12 million subscribers nationwide.
Officials at DirecTV and EchoStar declined to comment.
Both companies lag behind the cable industry, lacking an ability to offer Internet and digital phone service over their satellite systems. DirecTV has partnered with Denver-based Qwest to provide customers with a full package of video, phone and DSL service, while EchoStar has teamed up with San Antonio- based AT&T and smaller telecommunications companies to offer a similar bundle of services.
EchoStar and DirecTV are “respectful rivals,” viewing cable and the telecommunications companies as bigger forces to confront, said Jimmy Schaeffler, senior multichannel analyst for the Carmel Group.
“They talk on a regular basis, and they’re just waiting for the right deal between them, and this just might be it,” he said. “They only have one leg of a three-legged stool. This would give them two more legs.”
News Corp. chairman Rupert Murdoch told investors at a conference this month that he would like to make broadband more ubiquitous worldwide. He said DirecTV is looking at “various alternatives” to deploy high-speed data services in the U.S. by “going it alone or with a few people.”
“We have a lot of people on this full time at the moment, and you’ll be hearing from us in probably two months on a very clear plan on what will happen,” Murdoch said at the Citigroup 16th annual Entertainment, Media and Telecommunications Conference. “And it’s not as expensive as you might think. It may be an investment of less than a billion (dollars) by DirecTV.”
A joint broadband offering between the leading satellite- TV providers raises antitrust implications, Schaeffler said.
However, a major goal of the Federal Communication Commission is to foster competition, and it may approve such a partnership if the companies offer different services and prices using the same infrastructure, he said.
Staff writer Kimberly S. Johnson can be reached at 303-820-1088 or kjohnson@denverpost.com.
