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FCC kills satellite TV merger

Thursday, Oct. 10, 2002 | 9:58 a.m.

ASSOICATED PRESS

WASHINGTON -- The Federal Communications Commission rejected today a proposed merger between Echostar Communications Corp. and Hughes Electronics Corp., scuttling a $26 billion deal that would have created the nation's largest pay-TV service.

EchoStar, based in Littleton, Colo., runs Dish Network, while Detroit-based Hughes operates DirecTV. Together they serve about 18 million subscribers.

Opponents said a merger would create a monopoly in many areas, particularly in rural places without access to cable television.

Echostar and Hughes made a last-ditch effort to save the deal Monday, asking FCC Chairman Michael Powell to delay making any decision while the companies negotiated revisions with the Justice Department, which also had to approve the merger.

The companies said they would submit a series of proposed changes to address a list of the department's concerns by Oct. 28. The companies would not disclose the revisions, but it was believed they were prepared to sell enough transmission capacity to create a a new company to provide competition.

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