EchoStar Communications Corp. Monday
invested $50 million in Gilat-To-Home
Inc. to provide two-way satellite broadband Internet services.
As a result of the investment EchoStar (DISH)
will hold approximately a 17.6 percent stake in Gilat-To-Home. Microsoft Corp. took a 26 percent
stake in the new company in February.
Gilat-To-Home is a joint broadband venture whose partners include EchoStar,
Gilat Satellite Networks Ltd. (GILTF) and Microsoft (MSFT).
The companies have teamed up to offer consumers MSN high-speed Internet access via two-way
satellite. The deal takes aim at providing high-speed Internet access to
areas where landlines fail to deliver.
Under the terms of the agreement, EchoStar will distribute and install the
Gilat-To-Home broadband satellite Internet service powered by MSN along
with DISH Network satellite TV
service through its 23,000 nationwide retail outlets.
Charlie Ergen, EchoStar chairman and chief executive officer, said it made
sense to formalize the relationship with Gilat-To-Home and have a solid
working foundation for a long-term relationship.
“We hope that EchoStar’s agreement and investment with Gilat-To-Home will
bring high-speed Internet access and hundreds of television channels into
rural communities and other areas which may not be served by terrestrial
broadband technology for years to come,” Ergen said.
Yusuf Mehdi, Microsoft vice president of consumer group marketing, said the
EchoStar investment would facilitate bringing the first two-way satellite
broadband Internet access offering to market later this year.
“We have received very positive feedback in early trials of the MSN
Gilat-To-Home service,” Mehdi said. “This solution makes it possible for
more consumers to get high speed access to MSN’s Everyday Web services and
we look forward to making it broadly available later this year.”
The Gilat-To-Home services will be available in a variety of monthly
service packages and to be introduced to the consumer marketplace late this
year. The firm reports that its two-way satellite service could provide
Internet access at speeds up to 10 times faster than normal modem speeds,
with burst rates considerably higher.
Two-way service is designed to deliver high-speed Internet connections to
personal computers via a single small satellite dish. The same dish will be
capable of receiving up to 500 channels of DISH Network satellite TV
programming, delivering a bundled service opportunity previously
unavailable in the consumer market.
