EchoStar Settles with Network Affiliates

By Nate Mook, BetaNews

August 28, 2006, 1:19 PM

In response to a U.S. Supreme Court decision to reject an emergency stay of an injunction that would prevent it from rebroadcasting local TV channels to rural areas, EchoStar has agreed to pay $100 million to a group of network affiliates. Fox, however, has refused to accept the deal.

Both DISH Network, which is owned by EchoStar, and DirecTV offer the major networks from large market stations to subscribers who cannot receive them over-the-air. But networks said that both companies are providing the service to those who can receive the channels via broadcast, which is a violation of copyright.

Under the terms of the settlement, DISH will be allowed to continue broadcasting channels run by ABC, NBC and CBS affiliate groups to all subscribers. The company had already reached deals with the major networks themselves.

EchoStar also said it will expand the number of markets where it offers local channels to 175 from 165 currently. The news means DISH will be able to better compete with cable television operators, but there is still a major kink in the company's plans: Fox.

News Corp., the parent of DISH rival DirecTV, also owns Fox. The network has refused to settle with EchoStar and plans to continue its court battle with the company. 25 stations are involved in that litigation, and EchoStar could be forced to pull all Fox channels from its local lineups.

EchoStar added that it could end up taking its case to Congress and pushing for legislation on the matter.