The time is right for Directv and Echostar (Dish Network) to merge. Rumors about a possible upcoming merger between the two have begun to circulate recently. I hope it happens this time. They tried it four years ago but were rejected by the FCC, whose members felt that a merger would violate antitrust laws.

However, their primary competition is no longer each other but the cable and phone companies, which have more advantages. Right now, satellite operators cannot provide competitive broadband, video-on-demand, and VoIP on their own the way the cable and phone companies can. In addition, even more direct competition in these technologies, in the form of broadband by power line (BPL) and wireless, are beginning to hit the market. A combined company would have a better chance to compete in these technologies.

In addition, it could eliminate all the duplication of services. Think about it - 95% of the channels carried by Directv are also carried by Dish Network and vice versa. This does not just include the the 200-300 national channels that each one offers. They both carry local channels in nearly 100 markets each. Most of these markets are duplicated. The satellite space and bandwidth freed up by the elimination of this wasteful duplication could be used for additional channels, more HDTV, and more competitive broadband offerings. In short, a merger of these two satellite giants would mean more competition, not less.