Judging by the tone of Michael White‘s comments to investors today, he’s souring on the thought of trying to merge the No. 1 satellite company with its chief rival Dish Network. At the beginning of August the DirecTV chief said that while it might take a lot of work to do a deal he’d “never say never.” But he just told the Goldman Sachs Communacopia Conference that “there’s no question it’s very challenging for any deal to get done” following the Justice Department’s decision last month to fight American Airlines’ plan to merge with US Airways. Some analysts thought that the companies might overcome government antitrust concerns by offering to use the airwave spectrum rights that Dish has amassed to build a national wireless broadband service. White says that conceptually “that would be a powerful argument,” but adds that “powerful doesn’t necessarily make the other [antitrust] issues go away.”
Meanwhile, the exec hammered programmers who are demanding high price increases for the right to carry their channels. “Our [retransmission consent] costs are up 50% this year, and 500% to 600% since 2010.” Regional sports networks present a challenge as well. “We’re not carrying some sports content that we’d like to carry.” He adds that he “can’t tax all my customers for something that 98% of them aren’t going to watch…There’s a point where you have to stand up for the 99% who are angry about their bills.” And DirecTV customers may become angrier in 2014: Prices “will have to go up again,” White says. The company is bracing itself, based on what happened after this year’s rate hike. Although “I’m still comfortable that, net-net, we can make the math work,” he notes that “clearly I’ve seen an impact from consumers in churn, [reflecting] how they feel about the bill.”
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