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Technology Stocks : Echostar Comm.

SATS 67.76

+0.8%

9:42 AM EST

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To: Noel who wrote (785)	5/4/1998 6:36:00 PM
From: Goodboy	Read Replies (1) of 1394

First of all, I am not bearish on Dish, but aware that a tough competitor is about to get tougher. Primestar has just over 2.1 million Medium power subs and just picked up 1.2 million c-band subs on the cheap (less cost than it takes for them to aquire a medium power sub). In addition, they have a exclusive listing of 800,000 former c-band subs who do not yet have DBS. This gives them over 3.3 million total subs. Not DBS subs because they still do not have high power approval. The FCC has asked Primestar not to launch at 119 because they feel it would be circumventing their authority to launch service without a transfer approval to send 119 from Tempo to Primestar. Primestar also doesn't want to launch there because they want 110 slots with AskyB. They couldn't launch 119 without knowing if they will get approval of 110, which the 110 approval will likely require that they divest 119 (sell the slots and the satellite to best bid). Negative news for Primestar would have been no extension of launch. You will notice that the denial to lease relates to circumventing the FCC's authority prior to a decison and they went out of their way to say that no general restrictions on leasing satellite space exist, Primestar will be a big competitor. If you were right and the cable partners and News Corp/MCI were going to just go after rural non-cabled America, then the stock and the company would languish. That would also leave the rest of the country to just Direct TV and Echostar. What company in the world would not want a formidable competitor to just not compete. Hold 22 DBS slots hostage for 650 million plus two satellites at another 550 million in News Corp/MCI money as they are being sued for 1 billion plus by Echostar. For some reason I don't think their is any strategic or economic reasons for doing anything other than go after DISH and Direct TV. They will be public with an independent board of directors. The consent decree from DOJ is being drafted as we speak and they have asked Primestar to not comment publicly until they release the details. Once by DOJ, FCC is a cakewalk. This deal is within weeks of approval and stock is way undervalued. Several analysts waiting to upgrade on approval. I am very confident in this position since I spoke with FCC lawyers and a DC lobbyist. Dan O'brien and Primestar but on quite a presentation for the DOJ.

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