Charlie Ergen: When he’s not running the nation’s No. 3 pay TV service, or cleaning up at the blackjack table, he’s thinking up new ways to protect the linear TV business from hordes of digital-video invaders.
Interviewed by the Wall Street Journal, the Dish Network (s DISH) founder and chairman attempted to paint a new, highly controversial commercial-skipping feature in his company’s Hopper digital video recorders as a necessary innovation.
“Ultimately, broadcasters and advertisers have to change the way they do business or they run the risk of linear TV becoming obsolete,” Ergen told the paper.
But in the same interview, even the 59-year-old former pro gambler seemed to belie his own spin, tying the introduction of the new commercial-skipping feature to a motive that many have suspected all along: Dish wants leverage to drive down spiraling broadcast network retransmission fees.
“If the ad is skipped, the consumer likes it, but it’s not necessarily good for me and it’s not necessarily good for the broadcaster because I’m in the same ecosystem as him,” Ergen told the Journal while consuming a $2.98 pancake breakfast at his favorite place near Dish’s Englewood, Colo. headquarters:
“So we have to figure out how the broadcaster benefits, we benefit and the consumer continues to feel like he gets a fair deal. So maybe [the consumer] pays a little bit less for ‘retrans,’ his bill doesn’t go up by double digits every year … That’s an interesting conversation to have.”
One skeptical TV executive interviewed by the paper, when apprised that Ergen had described the commercial skipping as an innovation, said, “That’s like putting nice drapery on top of a casket. It’s 99 percent more likely that the conversation … is about retransmission fees.”
Dish ignited a fire storm last month when it introduced a new feature called Auto Hop that deletes commercials from recordings of broadcast-network shows. The matter quickly moved to federal court, with the major networks suing satellite carrier, but not before it was able to sue them first in a pre-emptive move.