Is An EchoStar Purchase Good Or Bad For Sling Media?

from the might-scare-off-others dept

Late Monday, the news came out that EchoStar was buying Sling Media for $380 million in cash and stock. It’s not surprising that Sling would go for such a deal, but it’s a pretty wide open question as to whether or not this move will hurt Sling’s prospects. EchoStar had already been an early investors in Sling, but in buying the entire company outright, it might make it that much harder for Sling to work with other providers, who might not want to be seen supporting the “competition.” Also, since Sling isn’t EchoStar’s main business, if the company comes on hard times, it may not devote enough resources to keeping Sling moving forward. Finally, there were already plenty of companies who were upset about how the Slingbox enables placeshifting. There have been occasional threats of lawsuits from organizations like HBO and Major League Baseball. While Sling has pretty strong defenses for why the Slingbox is legal, now that there’s a big company with a lot of money behind it, it becomes a much more attractive lawsuit target. In fact, it wouldn’t be surprising to see lawsuits start to fly against Sling and EchoStar rather rapidly. All in all, it makes you wonder if Sling Media is actually worth a lot less as a part of EchoStar than independent. That doesn’t mean it’s a bad deal for the folks at Sling, who have a great opportunity to cash out — but it could potentially slow down the innovation coming out of the company.

Filed Under:
Companies: echostar, sling media

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Comments on “Is An EchoStar Purchase Good Or Bad For Sling Media?”

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Davis Freeberg (profile) says:

Not an "attractive" lawsuit

Yes Dish has deep pockets, but anyone familiar with Dish’s history knows that Charlie Ergen is crazy when it comes to lawsuit. Probably one of the few deep pockets that will take something all the way to the supreme court, even when it cheaper to settle. When TV Guide tried to sue them over patent violations related to their guide, Ergen ended up with a piece of their company. If Sling was going to be sued, it would have been before they had money. The studios would be more interested in shutting this down then trying to win damages.

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