What to Watch in Telecom By Sandra Ward
Highlighted companies: Echostar (DISH), DirecTV (DTV), News Corp. (NWS), Liberty Media (LINTA), AT&T (T)
Summary: Interview with Blair Levin, Managing Director of Stifel Nicolaus and veteran telecom and media expert. Levin sees a Democratic Congress pushing for network neutrality, and the big carriers hampered in their ability to fight back by pending mergers like that of AT&T/Bell South. He believes the most important issue facing telecom/media investors in the near future is that of direct-broadcast satellite [DBS]: how many multichannel video and broadband providers will we have? Can Echostar and/or DirecTV fill out a 'quadruple play' bundle of video/voice/data/wireless to compete with the cable companies and Bells? Levin's 'best guess is that a telco buys a DBS player and the most likely deal will be AT&T buying EchoStar.' Regarding edge-of-the-network companies driving product innovation: 'There has never been a company that has threatened as many business models as Google: newspapers, magazine publishers, television broadcasters, radio broadcasters, cable companies, telephone companies -- and none of them is Google's natural competitor.'
Related: Coverage of the net neutrality debate • DIRECTV Q2 2006 Earnings Conference Call Transcript • EchoStar CEO "More Hemmed In Than Ever" • EchoStar's Stock, at 6x 2007 Cash Flow, Could Double