By Shalini Ramachandran
Dish Network Corp. Chairman Charlie Ergen came out swinging
against the Comcast-Time Warner Cable merger and hinted that Dish
could reattempt a merger with satellite-TV rival DirecTV.
The cable megadeal "certainly doesn't hurt the case for
consolidation" of the two satellite-TV giants, Mr. Ergen said. "If
you take the No. 1 and 4" players in pay TV and put them together,
"it would be hard to see why you couldn't put the numbers 2 and 3
together."
DirecTV and Dish are the second- and third-biggest pay-TV
providers by subscribers, while Comcast Corp. and Time Warner Cable
Inc. are No. 1 and 4, respectively.
A Comcast-TWC merger would "send a seismic shift across our
industry" that "puts pressure on everybody" in the video and
broadband businesses in an "unprecedented" way, Mr. Ergen said.
"There is nothing that I can see that's positive about it for
anybody in the video or broadband or content business."
Mr. Ergen's comments came a day after DirecTV Chief Executive
Mike White voiced his opposition to the cable deal. Mr. White also
said DirecTV "will continue to look at options for how we can
strengthen our company for the long term."
DirecTV and Dish tried to merge more than a decade ago but
abandoned that effort in the face of regulatory opposition. In the
past year or two, however, executives from both companies have
indicated a continuing interest in the merger idea, while
acknowledging regulatory uncertainties.
Company executives have also noted that another obstacle facing
a combination could be the divergent strategic paths the two have
taken in recent years. Unlike DirecTV, Dish is looking to enter the
wireless business, for instance. On Friday Mr. Ergen said the
different strategies "don't necessarily make things impossible" and
after the Comcast-TWC deal, it "certainly makes us look at
everything in a different light."
Dish's executive vice president of corporate development, Tom
Cullen, told analysts that management was assessing the impact of
the deal and will be putting together "options, recommendations and
impacts" to be shared with its board of directors "shortly." Mr.
Ergen said Dish hasn't yet decided whether to formally oppose the
deal.
Mr. Ergen's comments came as Dish said its fourth-quarter profit
jumped 38% as it added subscribers to both its pay-TV and broadband
services.
On the subject of wireless, Mr. Ergen made clear that Dish isn't
interested in going up against SoftBank Corp. of Japan, which
bought control of Sprint Corp. last year. The Wall Street Journal
has previously reported Sprint's interest in an acquisition of
T-Mobile.
"We're realistic to know we're not going to outbid SoftBank in
any transaction," Mr. Ergen said.
Separately on Friday, Charter Communications Inc. CEO Tom
Rutledge told analysts that Charter remains interested in expanding
through a merger "when that opportunity arises," his first public
comments since Charter's bid for Time Warner Cable was trumped by
Comcast last week.
Mr. Rutledge's comments came as the fourth-largest cable
operator by subscribers swung to a fourth-quarter profit on higher
revenue, boosted by its acquisition last year of Bresnan Broadband
Holdings LLC.
Michael Calia contributed to this article.
Write to Shalini Ramachandran at
shalini.ramachandran@wsj.com
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