Ed Driscoll

Is Satellite TV A Lead Zeppelin?

In the latest Blog Week In Review, Austin Bay and Glenn Reynolds discuss Rupert Murdoch’s recent acquisition of MySpace for $580 million. Is Murdoch shifting his attention primarily to the Web? Variety writes that he’s seriously considering dumping his holdings in DirecTV:

In a splattering blow to the satellite biz, Rupert Murdoch supposedly dubbed DirecTV a “turd bird” and is considering selling News Corp.’s controlling stake to Liberty Media.

FCC chairman Kevin Martin on Thursday shot down another possible outcome for the satcaster. He indicated regulators still would be reluctant to greenlight a merger between DirecTV and smaller rival EchoStar.

News Corp. owns 38% of DirecTV, the nation’s largest satellite provider. But Murdoch’s been down on the business lately. Cablers are successfully rolling out a triple play of video, Internet and telephone — service that satcasters can’t easily match.

DirecTV stock fell 3.23% Thursday to close at $19.19 after a Morgan Stanley analyst downgraded the shares.

A person close to the conglom said a DirecTV sale is being discussed as one of several possible ways to unwind Liberty’s large stake in News Corp.

CNBC reported that Murdoch had made the “turd bird” remark.

The current architecture of satellite TV does make it vulnerable to end-runs by both digital cable TV (which offers video-on-demand, something currently difficult, if not impossible with satellite architecture), and especially, the phone companies’ IPTV format, which, if all of its proponents’ forecasts pan out, could be a remarkable advance in television technology.

DirecTV better do everything it can to hold onto its NFL Sunday Ticket monopoly. It could very well be the only thing keeping millions of viewers attached to the format, if new technologies continue to pass it by.