It was announced this week that DirecTV will acquire EchoStar’s video distribution business including Dish TV and Sling TV, through a debt exchange transaction.
DirecTV will pay only $1 for the Dish and Sling TV brands, but will take on $9.8 billion of DISH's debt.
The two companies have lost 63% of their subscribers since 2016, as more and more consumers switch from services such as satellite TV to streaming platforms for video content.
DirectTV hopes the acquisition, and the subscribers that come with it, will enable the company to compete in a changing climate for TV programming.
EchoStar, meanwhile, hopes to be able to focus on its 5G network, and “provide U.S. wireless consumers with more choices and help to drive innovation at a faster pace,” said EchoStar CEO Hamid Akhavan.
At the same time, private equity firm TPG also intends to buy AT&T’s 70% stake in DirecTV.
A DirecTV and Dish merger has been discussed as a concept for years, and an attempted merger was blocked by regulators in 2002. This time, however the TV landscape looks much different, and the deal is expected to be approved.