On Tuesday, the two satellite TV services issued a joint announcement. EchoStar — the company behind the DISH Network — and DirecTV announced that they had settled “certain litigations” between them. Apparently, both were using each other’s trademarked names in sponsored links on search engines using services such as Google Adwords. These links would use the competitor’s name to drive traffic to their own sites. The announcement stated that both companies agreed to stop the practice, at least until the Supreme Court or Congress establishes that this “is not a violation of the law.”
The fact is that the satellite TV market is one of the most competitive segments of the entire HDTV industry. Why do you think that there are so many offers out there for free dishes and free installation and all sorts of other great deals? It’s because the hardest part is getting the subscriber to sign up in the first place. Once they start receiving the service, they are less likely to cancel so the costs of maintaining a customer are much lower than the costs to sign them up. Presumably this new agreement will place some boundaries on what the two companies are willing to do to get new subscribers.
For one comparison of satellite TV services, click here.