EchoStar’s Dish sale marks disappointing end to Charlie Ergen’s ‘Seinfeld’ strategy

EchoStar’s Dish sale marks disappointing end to Charlie Ergen’s ‘Seinfeld’ strategy


Dish’s Charles Ergen

Andrew Harrer | Bloomberg | Getty Images

Dish’s “Seinfeld” strategy appears to have ended quite like the actual show — with its finale a generally-accepted disappointment.

In 2011, Dish cofounder Charlie Ergen first mentioned “Seinfeld” on an earnings call, responding to an analyst’s question about his company’s mixed bag of assets. Ergen noted a half-hour episode of the 1990s sitcom would usually start with multiple plot lines without a clear direction, “But it all seemed to come together in the last couple of minutes,” he said. “And so I think in terms of where we’re going strategically, you’ll have to just wait and see where it all comes together.”

On Monday, assuming regulatory approval, the conclusion was revealed.

EchoStar, Dish’s parent company, sold the pay-TV provider to DirecTV for a nominal price of $1 and $9.75 billion of associated debt on the business. EchoStar shares fell more than 11% Monday.

In recent years Dish tried and failed to transition to a nationwide wireless carrier, while seeing millions of pay-TV subscribers cancel for streaming services and operators that include high-speed broadband, such as Comcast and Charter.

Dish and DirecTV have lost a combined 63% of their video subscribers since 2016.

“Times have changed,” said EchoStar CEO Hamid Akhavan in a CNBC interview Monday. “The content-distribution industry has been on the decline, losing customers at a rapid pace.”

The company’s enterprise value has plummeted in turn.

When Dish and DirecTV discussed merging in 2014, DirecTV’s market capitalization was about $40 billion, and Dish’s market valuation was more than $28 billion.

DirecTV sold a year later to AT&T for $49 billion in equity value. Dish remained independent and lost almost all of its value as its business dwindled and satellite TV has become increasingly anachronistic.

EchoStar and Dish merged back together earlier this year after separating in 2008. EchoStar was motivated to move Dish and its debt off its balance as a $2 billion debt payment matures in November, CNBC reported last week.

Wireless gambit

When Ergen used to talk about Dish and its future trajectory, he’d sometimes hold out his hand and stretch out his fingers, using them as metaphors for different pathways forward. For years, he tried to marry Dish’s pay-TV business with a wireless service, buying up spectrum at auctions and petitioning regulators to allow its usage.

Dish ended up acquiring Boost Mobile as a divestiture from T-Mobile for $1.4 billion in 2019. Still, without a partner, it’s been difficult for Dish to find the capital to both run its pay-TV business and build out a nationwide network to compete with AT&T, Verizon and T-Mobile — especially as satellite TV cash slow diminishes each year with the loss of millions of subscribers.

“We couldn’t feed [the wireless] business properly,” Akhavan said Monday. “The focus of the company being in multiple directions was also a management distraction.”

The actual series finale of “Seinfeld” was widely panned compared to the show’s best episodes. It’s hard not to view this pathway for Dish as a similar disappointment.

WATCH: EchoStar CEO exclusive CNBC interview on Dish-DirecTV tie-up

EchoStar CEO on DirecTV-Dish Network deal: It's the 'right time' to do this



Source

This is why Jamie Dimon is so gloomy on the economy
Business

This is why Jamie Dimon is so gloomy on the economy

Jamie Dimon, CEO of JPMorgan Chase, testifies during the Senate Banking, Housing and Urban Affairs Committee hearing titled Annual Oversight of Wall Street Firms, in the Hart Building on Dec. 6, 2023. Tom Williams | Cq-roll Call, Inc. | Getty Images The more Jamie Dimon worries, the better his bank seems to do. As JPMorgan […]

Read More
Summer rentals in the Hamptons are down 30%
Business

Summer rentals in the Hamptons are down 30%

Key Points Summer rentals in the Hamptons are down 30% from the same period in previous years, according to Judi Desiderio of William Raveis Real Estate. Brokers who focus on ultra-high-end rentals are seeing an even bigger drop and say their rental business is down between 50% and 75%. Some renters may be holding out […]

Read More
Costco tops earnings and revenue estimates as sales jump 8%
Business

Costco tops earnings and revenue estimates as sales jump 8%

The sign on the side of a Costco is seen in Hawthorne, California, on April 4, 2025. Jay L Clendenin | Getty Images Shares of Costco fell slightly on Thursday, despite the warehouse club posting quarterly earnings and revenue that topped estimates and reporting 8% year-over-year sales gains. Here’s how the warehouse club retailer did […]

Read More