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FCC blocks plans for EchoStar, DirecTV merger

NASHVILLE, Tenn. (BP)–Arguing that the harm to consumers would be “staggering,” the Federal Communications Commission has stopped EchoStar Communications Corp.’s proposed $16 billion purchase of its rival, DirecTV. The proposed merger had caused a rift within the National Religious Broadcasters, the country’s leading association of religious stations and programmers.

The FCC’s Oct. 10 decision states that the nation’s top two satellite television companies would “stifle competition and innovation, lead to higher prices for consumers and hurt the quality of service.”

It was the first time since 1967 that the FCC voted to halt a major merger. Both sides are expecting a lengthy legal battle between the government and the two companies.

“The combination of EchoStar and DirecTV would have us replace a vibrant competitive market with regulated monopoly,” FCC chairman Michael K. Powell said at a Washington news conference. “This flies in the face of three decades of communications policy.”

The proposed merger would have created the nation’s largest pay-television company with more than 18 million customers.

NRB had opposed the merger, with the group’s chairman, Glenn Plummer, saying the merger would limit access to Christian television networks.

“The merger would eliminate one of only two competing providers of direct broadcast satellite facilities, thereby effectively eliminating competition in multichannel video distribution for the several million Americans not reached by cable,” Plummer said in a May 31 interview with Baptist Press.

Plummer, as well as Traditional Values Coalition President Louis Sheldon, accused EchoStar of having a bias against Christian programming, alleging that the company’s inclusion of pornographic channels shows it has a resistance to Christian and family oriented programming.

“Religious broadcasters have an intense interest in ensuring program availability to their potential viewers,” Plummer said. “Certain programmers, such as Christian broadcasters, have a fundamental interest in audience maximization that extends beyond financial considerations. Christian broadcasters are committed to the biblical mandate to share the gospel of Jesus Christ.”

However, some NRB members disagreed with Plummer’s assessment of the merger — including FamilyNet Television President David Clark, a former NRB chairman and current board member.

“I don’t like the idea of a religious organization taking issue with EchoStar and DirecTV based on what is a business decision,” Clark told Baptist Press on May 31. “We shouldn’t be taking stands on that.”

Clark, president of the broadcast division of the Southern Baptist Convention’s North American Mission Board, said the NRB “has never taken a stand on an acquisition effort because we have viewed that sort of activity as part of a free marketplace.”

Clark especially took issue with the allegations of the company’s inclusion of pornography.

“As the former chairman and CEO of the National Religious Broadcasters, and as a current board member of the NRB, I find it difficult to explain how Rev. Sheldon can voice ‘moral concerns’ over a merger between EchoStar and DirecTV when those companies have been integral to the dissemination of thousands of family oriented and religious programs,” Clark wrote in an op-ed piece published in July. “The effort is part of a campaign by … [Rupert] Murdoch and … Sheldon to thwart that merger, to Mr. Murdoch’s great potential financial benefit.” Murdoch’s News Corp had been outbid in an effort to acquire DirecTV.

“As a religious American, I find the alliance between … Murdoch and … Sheldon to be deeply troubling,” in part because of the Fox network’s programming lineup that includes “Temptation Island,” “Looking for Love: Bachelorettes in Alaska” and “Celebrity Boxing,” Clark said. Murdoch’s News Corp. owns the Fox Entertainment Group.

Clark said he supports the merger because he believes it will lead to hundreds of Christian stations being carried on satellite.

Sheldon told CNSNews.com he disagreed with Clark and was irritated with Clark “that he hasn’t had the courtesy, the intelligence or the decency to call an old friend” before going public with his complaints.”

Neither Clark nor Plummer could not be reached for comment on the FCC ‘s Oct. 10 ruling.

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  • Todd Starnes