An unclear future for DISH?

charlieergen1999.jpgWall Street sell-side analysts seemed to be unsurprised by AT&T’s decision to pick DirecTV as its video marketing partner for its version of the ‘triple play’ package, in regions where it hasn’t built out its U-verse digital service.

The final decision had seemed obvious to analysts after DISH said earlier this month that AT&T would extend its five-year relationship by just one month to Jan 31.

But what does it mean for the independent DISH and its maverick founder/CEO Charlie Ergen (pictured), with the No. 2 U.S. satellite TV provider already struggling with customer losses in a tough economy?

Here’s what a few analysts say:

Craig Moffett, Sanford Bernstein.

The announcement is a clear negative for Dish Network, and a major win for DirecTV. As a result, we now expect Dish Network to post a sizable (400,000) subscriber loss for full year 2009. We had previously expected approximately flat net growth. For DirecTV, we now expect a gain of 800Kwhere previously we had expected approximately half that.

Ingrid Chung, Goldman Sachs:

While the loss of the AT&T contract should have a positive impact on 2009 free cash flow for DISH (due to subscriber acquisition costs), DISH will be somewhat strapped to do any investing in its own business for the next several months. DISH has $1 billion in debt maturities coming due Oct 1 and has no revolver in place. While DISH can pay down this debt (and $500 million for the AT&T convert) through cash and investments – $1.8 billion at 6/30/08 – DISH will have limited capital to invest in its mobile video initiative or build out its direct sales channel.

DISH’s Ergen won’t give in to TiVo: ‘I’m just stubborn’

charlieergen1999-2.jpgYou can think what you like about the management of DISH Network Corp, the second largest U.S. satellite TV operator, but they’re nothing if not refreshingly frank about the economy, the state of the market and their competitors’ tactics.

Of course, a lot of that has to do with the disarming candor of founder and Chief Executive Charlie Ergen, whose conference calls tend to avoid the sort of obfuscation and Orwellian double-speak the media and investors have to come expect from C-level executives in corporate America.

Ergen had to be especially blunt today on a day his company announced a loss 0f 25,000 subscribers, which according to Bernstein Research’s Craig Moffett, was its first ever loss of subscribers.

Waiting on the News Corp news

murdoch.jpgCome Tuesday, all eyes will be on News Corp.

The company’s earnings report should cast some more light on what’s happening in the media world – both in the United States and abroad. This is, after all, a media company with enormous reach and one whose shares have been hammered this year on worries about a slowdown.

For those who are impatient, Rupert Murdoch made some comments today that are worth noting. First and foremost, he said television advertising in the United States was good, despite a slowing economy (it’s easier to say that when your network is home to “American Idol”).

“Our advertisement on television and the Internet is very, very good, except for local television,” he said. “Cable networks are all sold out for 12 months,” he said, adding that Britain was holding up “very well”.

Who’s winning pay-TV war this quarter?

brianrobertsandglennbritt.jpgSo who’s winning the pay-TV so far this year? With days to go until two of the biggest cable operators (Time Warner Cable on Wednesday and Comcast on Thursday)  report first quarter financial results, Reuters canvassed eight Wall Street analysts for their estimates of subscriber net additions during the period.

At first glance it doesn’t look like it will be a good quarter with these analysts forecasting Comcast, Time Warner Cable and Cablevision to lose around 100,000 basic TV subscribers collectively, while satellite TV plays DIRECTV Group and DISH Network will add around 320,000.

Even more worrisome for cable companies?  AT&T and Verizon added around 410,000 new TV subscribers between them during the quarter.