Hughes linking up
Justice backs its acquisition of PrimeStar
The Justice Department's Hart-Scott-Rodino review covered tangible assets such as PrimeStar's 2.3 million subscriber base and two satellites. One of the satellites already has been launched.
The Federal Communications Commission is reviewing the transfer of licenses to operate high-powered DBS businesses. If the FCC, as expected, approves the transfer, the license would give DirecTV the ability to add about 90 more channels to its digital lineup.
Hughes' acquisition of PrimeStar, for its DirecTV subsidiary, is the result of the Justice Department's refusal to let PrimeStar into the high-powered DBS business. The Justice Department feared PrimeStar, which is owned by five-cable companies, would use the high-power satellite slot to inhibit competition from satcasters.
PrimeStar currently operates a medium-powered service that requires bigger receiver dishes than DirecTV's pizza-sized dishes. PrimeStar has concluded that it could not compete with the smaller dishes in the growing urban and suburban marketplace.
The boards of PrimeStar and Hughes already have blessed the deal.
