EchoStar, Hughes See a Glimmer of Hope

As EchoStar Communications (DISH Quote) and Hughes Electronics (GMH Quote) try to salvage their merger, industry onlookers say they'll change TV's competitive landscape even if they don't.

On Monday, EchoStar and Hughes -- the nation's two big direct broadcast satellite services -- said in a letter to the Federal Communications Commission that they will soon be discussing "major revisions" to their planned merger with antitrust regulators at the Justice Department, which is passing judgment on the deal along with the FCC.

The letter confirms recent reports that the DOJ was likely to reject the consolidation of the DBS companies as originally proposed, and it likely delays any federal approval of the deal until November at the earliest.

Yet industry onlookers say that EchoStar's Dish Network and Hughes' DirecTV service will continue to eat into the cable business, even if they remain divided -- despite the increasing expense of adding new DBS subscribers. On Monday, Hughes fell 7 cents, to $8.92, and Echostar rose 7 cents, to $17.02.

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