EchoStar's Dish sale marks the conclusion of Charlie Ergen's 'Seinfeld' strategy.

• On Monday, EchoStar agreed to sell pay-TV provider Dish Network to DirecTV for $9.75 billion in debt and $1 in equity.
• If approved by regulators, the transaction will end Dish's 10-year pursuit of combining pay-TV and wireless services.
• Ergen's 'Seinfeld' strategy, which he first referenced in 2011, has been rewritten as a new version of the original sentence.

The "Seinfeld" strategy employed by Dish seems to have ended similarly to the show's finale, which was widely regarded as a disappointment.

In 2011, Dish cofounder Charlie Ergen first discussed "Seinfeld" on an earnings call, responding to an analyst's inquiry about his company's diverse portfolio. Ergen pointed out that a typical half-hour episode of the 1990s sitcom would begin with multiple storylines without a clear direction, "But it all seemed to come together in the last couple of minutes," he said. "And so I think in terms of where we're going strategically, you'll have to just wait and see where it all comes together."

On Monday, assuming regulatory approval, the conclusion was revealed.

EchoStar shares plummeted more than 10% after its parent company, Dish, sold the pay-TV provider to DirecTV for a nominal price of $1 and $9.75 billion of associated debt on the business.

Despite attempts to become a nationwide wireless carrier, Dish has struggled to retain its pay-TV subscribers, who have increasingly turned to streaming services and operators that offer high-speed broadband, such as [.

Since 2016, both Dish and DirecTV have collectively experienced a 63% decline in their video subscriber base.

"In a CNBC interview on Monday, EchoStar CEO Hamid Akhavan stated that "the content-distribution industry is facing a decline, with customers leaving at a rapid pace.""

The company's enterprise value has plummeted in turn.

In 2014, when Dish and DirecTV were considering a merger, DirecTV's market capitalization was approximately $40 billion, while Dish's market valuation exceeded $28 billion.

AT&T acquired DirecTV for $49 billion in equity value a year later, while Dish Network remained independent but lost almost all of its value as its satellite TV business declined and became increasingly outdated.

EchoStar and Dish reunited earlier this year after being separated in 2008. The motivation behind this merger was to transfer Dish and its debt from EchoStar's balance sheet as a $2 billion debt payment comes due in November, according to CNBC's report last week.

Wireless gambit

Ergen would often use his hand and fingers as metaphors for different pathways forward when discussing Dish's pay-TV business and its future trajectory. For many years, he attempted to combine Dish's pay-TV business with a wireless service, purchasing spectrum at auctions and lobbying regulators to permit its usage.

Despite acquiring Boost Mobile for $1.4 billion in 2019, Dish has struggled to find the capital to run its pay-TV business and build out a nationwide network to compete with T-Mobile. This has been particularly challenging as satellite TV subscriptions continue to decline, resulting in a loss of millions of customers each year.

"Akhavan stated on Monday that the wireless business couldn't be properly fed due to its focus being in multiple directions, which served as a management distraction."

The finale of "Seinfeld" was widely criticized, and it's difficult not to see the path for Dish as a disappointment.

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