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Echostar Looking to Buy DirecTV Print E-mail
Wednesday, 15 August 2001
Echostar Communications, after last week's announcement of a deal to broadcast CBS' HDTV signals via their DSS satellite system, has made an offer to acquire competitor DirecTV from Hughes Electronics. DirecTV has been on the block in 2001 with reported interest from Rupert Murdock's News Corp. General Motors, the parent company of Hughes, is seriously looking at the offer from Echostar.

DirecTV is the leader in consumer satellite TV with over 10,000,000 end users and widespread commercial success including its legislative victories to provide local TV stations via satellite. No matter who buys DirecTV, Hughes is planning to launch yet another satellite which will provide even more local channels which is of interest to mainstream clients but doesn't address the new, wildly improved video format of HDTV.

DirecTV currently has very limited bandwidth allocated to HDTV including some HBO and Showtime channels. If they ink a deal with Echostar, you might see more of the bandwidth of the next satellite dedicated to HDTV signals. Early adopters of HDTV complain that there is barely any programming on for them to watch in HDTV that isn't from their terrestrial antennas and at that, there still is barely anything on.

The cost of converting film to HDTV is very affordable, costing about $10,000 for a 30 minute TV episode or a bit more for a feature film. Live HDTV broadcasts like sporting events and nightly news are an entirely different story with cameras and broadcast trucks costing millions. Despite not having a lot of HDTV programming currently available and a down US economy, HDTVs are selling at a brisk rate with nearly 300,000 sets sold in Q2 2001. With easier installation and much more HDTV programming, HDTV may be the big winner in the acquisition of DirecTV.

Sources: NYTimes.com, DirecTV.com

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