Sling Media gets snapped up by EchoStar for $380 million in cash and stock

Financial trends and news by Bambi Francisco Roizen
September 25, 2007 | Comments (4)
Short URL: http://vator.tv/n/5d

When I caught up with Sling Media founder and CEO Blake Krikorian earlier this year, he told me that running a startup is "not a sprint, it's a marathon." This week, he decided to end his race -- or at least get some help finishing.

By selling Sling to existing partner and investor EchoStar in a deal that values his firm at $380 million, Krikorian produced a successful exit for investors like Liberty Media, DCM and Goldman, Sachs & Co., from whom Sling had raised around $60 million.

From the very beginning, Krikorian has known that selling hardware and getting premium placement on retail store shelves to do so would be a tough business.

While Sling has done a good job getting to market fast, the challenge of selling a place-shifting set-top box remains a large one. Such a feature may quickly become a commodity, much like Tivo's value proposition of offering time-shifting has become as cable operators build such features into their own services.

Sling Media would have had the challenge of constantly staying one step ahead of the cable and satellite companies, like EchoStar, which have much deeper pockets. Now Krikorian will have access to them.

As for EchoStar, the Sling Media addition could help the satellite company get its pay-per-view programming to more viewers by allowing subscribers to remotely access it.

To see and hear more of Blake's thoughts on what it takes to be a successful entrepreneur, click on the video above.

Comments

Thom Calandra, on September 25, 2007

Great. If Mr. Krikorian is in for the marathon of running a business, I reckon to guess he and his team already are assembling new applications for EchoStar's SlingMedia. Tivo is the hardware innovator that fell off the horse. I'm sure many of us hope Krikorian's horse takes him much farther along the path of new media.
thomcalandra.com

Noli Francisco, on September 26, 2007

very well articulated, i would have liked to have said it.

Blake Krikorian, on October 2, 2007

Matthias,
sorry dude, but you dont know what the hell you are talking about.
obsolescence? times are rough? pleazzzzzzzze.
-Blake

Bambi Francisco Roizen, on October 3, 2007

Nice to see some dialogue going on here re EchoStar's purchase of Sling Media. I wanted to respond to Matthias' comments re EchoStar's ROI. While it's unclear how large the market is for "place-shifting," the Sling Media feature does create a differentiated product for EchoStar. Here's what Craig Moffett of Bernstein says: "Until now, EchoStar has bet primarily on DVRs (and low prices) as the core of its marketing proposition. But DVRs are increasingly a commodity, and allow little room for differentiation. An "anywhere" value proposition for consumers has the potential to position EchoStar's service offering as genuinely differentiated. In financial terms, the purchase of Sling Media for $380M – for cash and EchoStar options – is modest, even for DISH. EchoStar already owned a portion of Sling Media as a result of an investment in January 2006."

Blake Krikorian, on November 16, 2007

Matthias, you further pointed out that you don't know what you are talking about. The best-selling Slingboxes (AV, PRO, and the new SOLO) work with existing cable/sat/dvr boxes, not just over-the-air broadcasts. The SOLO and PRO both "take in" HD Component video signals from the latest generation set tops. There are plenty of legs in these products.

Your comment about "no sustainable competitive advantage" is hilarious. again, you have no idea of the market, nor what we are working on...but i bet you did get a MBA (your MBA 501 comment reeks of it), so i guess you must know more than I do ( i only got a BS in Mechanical Engineering, so i must not know what i am talking about).

Hope you enjoy to continue to sit on the sidelines critiquing other companies, while having minimal/any operational accomplishments to back up your viewpoints. I appreciate criticisms and challenges, but it drives me crazy when people who have absolutely no clue squawk like this, with no self-awareness of the boundries of their knowledge.

Note to all you entrepreneurs out there: guys like Matthias are exactly the type of folks i talk about in my video above. don't listen to folks like this.

-Blake