DISH NEtwork launches a bid for Primestar High-power assets:
biz.yahoo.com
It looks like DISH is valuing Primestar subs at zero (since they can convert as many as they want anyway), but that they are willing to pay the $600 million because it would be a cheaper way to expand their first-dish channel capacity than it would be to switch every existing dish to point to 110 deg.
Figure it like this: Tempo has the last 11 frequencies at 119, plus two satellites. The satellite in orbit is damaged, so value it at say $100 million. The satellite on the ground, maybe $150 million. That leaves a premium of $350 million for the slot. If you figure that DISH has about 2.1 million subscribers, this means they project that a re-point campaign would cost them more than $167 per subscriber (taking into account administrative overhead).
If that is true, they basically get additional channel capacity for free, limit customer disruptions, and maximize first dish channel capacity, leaving the 110 deg. slot to be a "local channel" second-dish application.
Worst case, they drive DIRECTV's cost up $100 million, and still doesn't have to pay anything for the subs he is converting.
I wonder what they are thinking about in El Segundo right now?
Regards,
NOEL
|
