EchoStar, Gilat, OpenTV to Sell Services Together

EchoStar Communications Corp., the No. 2 U.S. satellite-television company, reached an agreement with Gilat Satellite Networks Ltd. and OpenTV Corp. to sell Internet connections and other new services. OpenTV, the largest maker of software for digital TV, will pay 2.25 million shares, valued at $373 million, for EchoStar to sell its satellite receiver that lets customers pause and rewind live programs. Financial terms with Gilat, a satellite equipment maker based in Israel, weren’t disclosed. EchoStar will sell Gilat’s new Gilat-to-Home Inc. Internet service venture with Microsoft Corp., letting subscribers watch TV while also connecting to the Internet at speeds 10 times faster than from a telephone modem.

Gilat-to-Home customers will be able to purchase a satellite dish that gives them access to both the Internet and television programming, an EchoStar spokesman said. The venture will compete with a similar one by America Online Inc. and General Motors Corp.’s Hughes Electronics Corp., which owns EchoStar’s chief rival, DirecTV.

Littleton, Colo.-based EchoStar’s shares jumped $20.81 to close at $120.81, while Mountain View, Calif.-based OpenTV rose $14.75 to $165.63, and Gilat’s U.S. shares rose $8.25 to close at $168.25, all on Nasdaq.

EchoStar also said it will launch three satellites to add to the six it will have in orbit. Two of the satellites will be made by Loral Space & Communications Ltd. and the third by Lockheed Martin Corp. The satellites, whose cost wasn’t disclosed, will help the company carry the new services.