EchoStar Committed To Mexican Satellite-TV Venture
Byhttp://www.goodfta.com
MEXICO CITY Echostar said Monday that it remains committed to its satellite-TV venture in Mexico, in which it plans to invest $ 112 million over a 10-year period.
“The business has got off to a good start and clearly gotten the attention of the competition,” EchoStar Chairman and Chief Executive Charles Ergen said during a conference call to discuss third-quarter results.
EchoStar formed a joint-venture with Mexican telecommunications firm MVS Comunicaciones in November 2008 to sell pay-TV packages for as little as 149 pesos ($11.20) a month to low-income consumers. EchoStar holds a 24% indirect stake in the venture, called Dish Mexico.
Dish Mexico competes directly with the cable and satellite TV subsidiaries of media giant Grupo Televisa SAB (TV), Mexico’s No. 1 television broadcaster and the largest producer of Spanish-language content in the world.
Televisa’s satellite-TV unit, Sky Mexico, responded to competition from Dish by launching its own low-cost package earlier this year.
Dish Mexico’s operations benefit from a billing-and-distribution agreement signed last year with the country’s largest fixed-line phone company, Telefonos de Mexico SAB (TMX), or Telmex.
Telmex, which is prohibited from directly selling pay-TV services to its clients, has hinted that it could invest in Dish Mexico if it were to receive the necessary regulatory approval.
While declining to comment on the number of subscribers at Dish Mexico, Ergen said “it’s a business that has good growth potential and profitability potential.”
EchoStar said Monday in its 10-Q filing with the U.S. Securities and Exchange Commission that, so far, it has contributed $59 million in the form of cash, equipment and services as part of its investment in Dish Mexico.
EchoStar said it expects to satisfy its remaining investment commitment by contributing about $27 million in cash and the rest in the form of services or equipment.
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