Dish yesterday posted its third quarter earnings which showed an overall increase in net subscribers of 116,000. Sling TV, the company’s live streaming service, gained around 203,000 subscribers while Dish, the satellite TV service, lost around 87,000.

With cord-cutting increasing, the results surprised some industry observers. Dish rivals Comcast and DIRECTV both reported significant decreases in subscribers in the third quarter.

Following the release of the third quarter report, Dish Chairman Charlie Ergen took questions from financial analysts and journalists and, as he usually does, offered some interesting and unique viewpoints on the top issues facing the industry today. Here are the highlights of Ergen’s comments:

Ergen: A DIRECTV-Dish merger is still “inevitable.”
Ergen has previously stated that a merger between DIRECTV and Dish, the nation’s leading satellite TV services, is “inevitable.” However, he said yesterday that news reports suggesting that AT&T is trying to sell DIRECTV to an equity firm increases the chances a merger will one day occur. Ergen noted that some analysts believe a merger now could face opposition from federal regulators. But selling DIRECTV to an equity firm could set the stage for a Dish-DIRECTV deal in a few years when regulators might be more receptive because there would be more Internet options available in rural areas.

“I’ve said publicly that I think the combination of those two companies is inevitable,” Ergen said. “The competition is not for us, it’s not DIRECTV, the competition is the actual programmers themselves that we deal with. They all have their own OTT products that they compete very well with what we do. It is in the consumers’ best interest that there will be scale as alternatives to that. But that’s a regulatory — that’s something where there has to be — I think that DIRECTV is or at least what I’ve read. So don’t take me as gospel on this, but they would like to deconsolidate that business and that they would like to do that before they would take any regulatory risk. Whether that happens or whether — how they do that or whether they do that, of course, remains to be seen. But make no mistake, whether it’s a year from now or 10 years from now, I believe it’s inevitable that those companies go together.”

Ergen: If a Dish-DIRECTV merger occurred, he says Dish would run the new company.
“I think Erik (Carlson, Dish’s CEO) and team are the best managers and the best in the business of managing that particular type of business. So I don’t know how a transaction takes place. But if it was me, I’d be looking for a DISH management team in some form or fashion,” Ergen said.

Dish Chairman Charlie Ergen.

Ergen: Dish is still hopeful of a deal with Sinclair’s regional sports channels. 
Dish has been without the 20 plus Sinclair-owned, but Fox-named regional sports channels for almost 16 months due to a fee dispute. But although Dish is not carrying other regional sports channels as well, Ergen said the company still believes they are important to a pay TV provider. Specifically, he said he’s not “pessimistic” about securing a deal with Sinclair at some point.

“I don’t think sports are dead and I don’t think regional sports are dead,” Ergen said. “It was so unfortunate that Sinclair didn’t own the company when we negotiated a deal. I think that there were things that could have been done that weren’t — that neither company was able to do. So I’m not as pessimistic about it.”

But Ergen added that the regional sports channels have to be more realistic in what they demand in fees from pay TV services.
“I think that things have to change and I think they changed in terms of new technologies and taking advantage of them and it changed in terms of features for the consumer… we have real math when it comes to programing content, we know what the value is to our customers,” Ergen said. “As we said on many conference calls, the value of regional sports to our customers was the most overrated…But we haven’t given up on sports. We think it’s parts of the ecosystem. We think that some changes around the edges and maybe a fundamental change here or there and it’s a business that’s going to be around for a long time. It’s got the advantage of being live. It’s got the advantage of being interactive. It’s got the advantage of passion. And it just needs to be restructured a bit.”

Ergen: Dish is not confident of reaching a new carriage agreement with Cox Media/Apollo. Three months ago, Dish lost 14 local network affiliates owned by Apollo, and managed by Cox, over fees, and it’s now negotiating a separate deal for 18 additional Cox/Apollo stations.
“I would say in general when somebody has been down for three, four months, it’s not likely they’re coming back,” Ergen said. ” Because what happens is you lose the customer — if there is really somebody who want to watch that particular network and they’re gone. All right. they’ve gone out and found another — they put an offer intend on place, they’ve found an another alternative to find it, they are online finding it, they’ve got the Hulu or they’ve gone somewhere else, they have gone to a competitor. If we weren’t willing to pay the price that they offered four months ago, we’re certainly not going to pay the higher price today than what we offered before because we don’t need customers who want to watch it.”

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— Phillip Swann