EchoStar’s Dish sales mark disappointing end to Ergen strategy | Wilnesh News

The ending of Dish’s “Seinfeld” strategy appears to be very similar to the actual show – which ended in what was generally considered a disappointment.

Dish co-founder Charlie Ergen first mentioned “Seinfeld” on an earnings call in 2011, responding to an analyst’s question about his company’s asset mix. Ergen noted that half-hour episodes of sitcoms in the 1990s would often begin with multiple plot lines and no clear direction, “but everything seemed to come together in the last few minutes,” he said. “So I think you’re going to have to wait and see where this all plays out in terms of our strategic direction.”

The conclusions will be revealed on Monday, assuming regulatory approval.

echo starDish’s parent company is selling the pay-TV provider to DirecTV for a nominal $1 and $9.75 billion in related business debt. EchoStar shares fell more than 10%.

In recent years, Dish has tried and failed to transform into a national wireless carrier, while seeing millions of pay-TV customers cancel streaming services and carriers including high-speed broadband, such as Comcast and Charter.

Since 2016, Dish and DirecTV have lost a combined 63% of their movie subscribers.

“Times have changed,” EchoStar CEO Hamid Akhavan told CNBC on Monday. “The content distribution industry has been in decline and customers are being lost at a rapid rate.”

The company’s enterprise value also plummeted.

When Dish and DirecTV Discuss merger In 2014, DirecTV had a market capitalization of approximately $40 billion, and Dish had a market capitalization of over $28 billion.

A year later, DirecTV was sold to AT&T $49 billion in equity value. Dish remained independent, but it lost nearly all value as its business shrank and satellite TV became increasingly anachronistic.

EchoStar and Dish Merged back together earlier this year After the 2008 spin-off.

When Ergen has talked in the past about Dish and its future trajectory, he has sometimes reached out and extended his fingers, using them as metaphors for different paths forward. For years, he tried to combine Dish’s pay-TV business with wireless services, buying spectrum at auctions and Petition to regulators to allow its use.

Dish eventually acquired Boost Mobile in 2019 after spinning off from T-Mobile for $1.4 billion. AT&T, Verizon and T-Mobile — especially as satellite TV revenue slowly dwindles as millions of subscribers are lost each year.

“We were unable to adequately meet the needs of the (wireless) business,” Akhavan said on Monday. “Companies are focused in multiple directions, which can also distract management.”

The actual series finale of Seinfeld is widely criticized Compared to the show’s best episodes. It’s hard not to view Dish’s path as a similar disappointment.

WATCH: EchoStar CEO’s exclusive CNBC interview about Dish and DirecTV partnership