Take your $100 million and .....

By Gigi Sohn
September 1, 2006

Reuters is reporting that a District Court in Miami has issued an order barring Echostar from retransmitting any distant signals to its customers, even those to whom it provides those signals legally. This “permanent injunction” was issued at the behest of the Fox network, which filed the request today. As I reported on Monday, the Fox network pulled out of settlement negotiations at the last minute last week, while Echostar settled with all the network affiliates (including Fox's), for $100 million and other concessions, including the cessation of service to all illegal subscribers. So what could have been a win-win situation for all involved has come down instead to this scenario – the Losers: nearly 800,000 innocent and legal subscribers to network distant signals who will no longer receive those signals; the affilliates, who are probably out $100 million and who now won't benefit from the increased local-into-local satellite service that was part of the settlement; and of course Echostar, whose previous behavior cannot be condoned, but who has done everything possible to ensure continued service to legal subscribers. The Winner: Fox and its parent company News Corporation, which owns Echostar's only direct competitor, DIRECTV. What possible motive could Fox have other than to kick its competitor while it was down, hoping that subscribers who lose their service will switch satellite providers? Sigh. I suppose now its time for Congress to get involved to protect consumers and competition.