Business & Entertainment Editors LITTLETON, Colo.--(BUSINESS WIRE)--Jan. 7, 2002--EchoStar Communications Corporation (Nasdaq:DISH) issued the following statement today in response to a petition filed by the National Association of Broadcasters (NAB) on Friday, Jan. 4, 2002, asking the FCC to modify or clarify the must carry rules: With the recent addition of over 250 local channels to the DISH Network Direct Broadcast Satellite television service, EchoStar is in compliance with the Satellite Home Viewer Improvement Act's must carry requirements. EchoStar originally planned to meet those requirements through the construction and launch of two new satellites at a cost of approximately $500 million. When Lockheed Martin and Space Systems Loral failed to timely deliver those satellites, EchoStar implemented the only alternative capable of meeting its must carry obligations while assuring consumers in all markets uninterrupted access to a complete lineup of local TV broadcast channels. Over 100 must carry channels are now available to EchoStar customers without any additional equipment. Consequently, customers previously receiving only NBC, CBS, ABC, FOX, together with a national PBS channel, now also receive for no additional charge their local WB, UPN, PBS, and other must carry channels. Unfortunately, as a result of the delayed launch of the new EchoStar 7 and EchoStar 8 satellites, limited bandwidth renders it impossible from a practical perspective for all must carry channels to be included on the same satellite. Consequently, in order to avoid disruption of service or delays in the introduction of must carry channels, EchoStar is offering a free satellite antenna to any customer who would like to receive the remaining must carry channels from a second EchoStar satellite. By filing a petition for modification or clarification instead of a complaint for failure to comply with the must carry rules, the NAB in its most recent FCC filing effectively concedes that EchoStar has met its must carry obligation. Nevertheless, the NAB now asks that the rules be modified to impose additional obligations on EchoStar. The must carry statute, and the FCC must carry rules, were the result of a thoroughly considered process, including a long notice and comment period and a re-evaluation of those rules after they were issued. The NAB was an active and vocal participant in the entire process. In fact, the FCC modified and clarified certain of its rules in specific response to NAB demands. However, the FCC declined to modify its rules in other respects and left intact the right of EchoStar to implement its must carry compliance plan. EchoStar then relied upon those rules in shaping its must carry compliance program. Those efforts provide significant benefits to the NAB and its members in addition to the benefits enjoyed by consumers. No additional obligation should be read into the statute. EchoStar has acted in good faith to shape its compliance program. EchoStar went to the extraordinary step of discussing its implementation plans in advance with not only the FCC, but also members of Congress and the NAB. Unfortunately, the NAB's continuing aggressive actions show that it cares more about scoring political points than serving its own members or consumers. If the FCC were to accede to the NAB's latest tactics to modify existing rules, limited bandwidth would force EchoStar to entirely terminate local channels in a number of markets it currently serves. "It is ironic because our must carry compliance program should please the NAB and its members," said Charlie Ergen, chairman and CEO of EchoStar. "The NAB said it wants satellite TV providers to offer local channels to consumers in a greater number of markets. They have also said they don't want consumers to lose local channels in any markets we currently serve. If the pending merger of EchoStar and Hughes Electronics and its DIRECTV is approved, EchoStar will be able to provide local channels by satellite in over 100 markets with full must carry compliance. And we will be able to do it all from a single dish as the NAB has also demanded. Yet, absurdly, the NAB is against a merger that will provide the only way to achieve all of their objectives." NAB members have the right to use the free digital TV spectrum they receive from the government to compete in the pay TV market. EchoStar welcomes that competition not withstanding the failure of many NAB members to timely comply with the obligations on which Congress conditioned the grant and continued use of that spectrum. However, the NAB goes too far when it pursues its agenda at the expense of American consumers. About EchoStar EchoStar Communications Corporation and its DISH Network operates a state-of-the-art direct broadcast satellite TV system that is capable of offering over 500 channels of digital video and CD-quality audio programming, as well as advanced satellite TV receiver hardware and installation. EchoStar is included in the Nasdaq-100 Index (NDX). DISH Network currently serves over 6.43 million customers. For more information, visit www.dishnetwork.com. In connection with the proposed transactions, General Motors Corporation ("GM"), Hughes Electronics Corporation ("Hughes") and EchoStar Communications Corporation ("EchoStar") intend to file relevant materials with the Securities and Exchange Commission, including one or more Registration Statement(s) on Form S-4 that contain a prospectus and proxy/consent solicitation statement. Because those documents will contain important information, holders of GM $1-2/3 and GM Class H common stock are urged to read them, if and when they become available. When filed with the SEC, they will be available for free at the SEC's website, www.sec.gov, and GM stockholders will receive information at an appropriate time on how to obtain transaction-related documents for free from General Motors. Such documents are not currently available. General Motors and its directors and executive officers, Hughes and certain of its officers, and EchoStar and certain of its executive officers may be deemed to be participants in GM's solicitation of proxies or consents from the holders of GM $1-2/3 common stock and GM Class H common stock in connection with the proposed transactions. Information regarding the participants and their interests in the solicitation was filed pursuant to Rule 425 with the SEC by EchoStar on November 1, 2001 and by each of GM and Hughes on November 16, 2001. Investors may obtain additional information regarding the interests of the participants by reading the prospectus and proxy/consent solicitation statement if and when it becomes available. This communication shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended. Materials included in this document contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause our actual results to be materially different from historical results or from any future results expressed or implied by such forward-looking statements. The factors that could cause actual results of GM, Hughes, EchoStar, or a combined EchoStar and Hughes, to differ materially, many of which are beyond the control of EchoStar, Hughes or GM include, but are not limited to, the following: (1) the businesses of EchoStar and Hughes may not be integrated successfully or such integration may be more difficult, time-consuming or costly than expected; (2) expected benefits and synergies from the combination may not be realized within the expected time frame or at all; (3) revenues following the transaction may be lower than expected; (4) operating costs, customer loss and business disruption, including, without limitation, difficulties in maintaining relationships with employees, customers, clients or suppliers, may be greater than expected following the transaction; (5) generating the incremental growth in the subscriber base of the combined company may be more costly or difficult than expected; (6) the regulatory approvals required for the transaction may not be obtained on the terms expected or on the anticipated schedule; (7) the effects of legislative and regulatory changes; (8) an inability to obtain certain retransmission consents; (9) an inability to retain necessary authorizations from the FCC; (10) an increase in competition from cable as a result of digital cable or otherwise, direct broadcast satellite, other satellite system operators, and other providers of subscription television services; (11) the introduction of new technologies and competitors into the subscription television business; (12) changes in labor, programming, equipment and capital costs; (13) future acquisitions, strategic partnership and divestitures; (14) general business and economic conditions; and (15) other risks described from time to time in periodic reports filed by EchoStar, Hughes or GM with the Securities and Exchange Commission. You are urged to consider statements that include the words "may," "will," "would," "could," "should," "believes," "estimates," "projects," "potential," "expects," "plans," "anticipates," "intends," "continues," "forecast," "designed," "goal," or the negative of those words or other comparable words to be uncertain and forward-looking. This cautionary statement applies to all forward-looking statements included in this document.
EchoStar Statement on NAB Petition