EchoStar's woes include challenges to its DirecTV transaction, an ongoing departure of its wireless executives and regulatory complaints filed by competitors.
A new report indicates that EchoStar's complex plan to sell its Dish-branded video distribution business to DirecTV is facing increasing static from some creditors.
At the same time, top executives in EchoStar's wireless business continue to leave. And separately one of the company's rivals is complaining that EchoStar unfairly received regulatory favors to delay its 5G network buildout.
As a result, EchoStar and its billionaire owner, Charlie Ergen, remain in a tricky situation.
"DirecTV has no intention of restructuring terms," wrote a DirecTV lawyer, according to the Financial Times (subscription required). The publication reported that DirecTV's owner TPG is not willing to change the terms of its acquisition of EchoStar's video distribution business, which includes the Dish satellite TV and Sling streaming TV units. The deal to acquire those divisions was announced last month.
The Financial Times reported that the two sides are now at an impasse, raising the prospect of DirecTV terminating the deal by November 9, per the terms of the transaction.
The development comes as no surprise, however. Securing the Dish-DirecTV agreement among EchoStar's creditors was "far from guaranteed," Bloomberg reported last month.
Departing executives, regulatory pressure
EchoStar also faces internal challenges. Officials in EchoStar's wireless business have been in a state of flux. For example, most of the company's original wireless network leadership team – first assembled in 2020 – have since departed the company.
The latest: Jeremy McCarty said on social media he would leave EchoStar after 14 years at the company. McCarty was listed as head of Boost Infinite, the brand EchoStar briefly applied to its postpaid wireless services.
Finally, EchoStar is facing complaints on the regulatory front. Vermont telecom provider Vtel said the FCC should not have approved EchoStar's revised 5G buildout plan.
The FCC's Wireless Telecommunications Bureau (WTB) last month granted EchoStar's request to extend the deadline for portions of its 5G network buildout into 2026 in exchange for several commitments, including a low-cost offering and a pledge to accelerate buildouts in certain markets.
"The net effect of WTB's grant of the Extension Request would be a three-year delay in the final deployment of EchoStar's 5G broadband network," Vtel wrote in a filing to the FCC.
Vtel argued that the WTB does not have the regulatory authority to grant such a request and said it should have been done by the full commission.
"WTB cannot ignore Commission rules or turn a blind eye to the obvious shortcomings in EchoStar's request to extend its final construction deadlines merely because the government may have a vested interest in EchoStar building a nationwide 5G broadband network," Vtel added.
You May Also Like
.jpg?width=700&auto=webp&quality=80&disable=upscale)
