Mr. Ergen, who controls Dish Network Corp. and EchoStar, has recently acquired part of a $300 million
tranche of Sirius debt that matures on Feb. 17, according to the
people. It isn’t clear
whether Mr. Ergen participated in the exchange, however. Mr. Ergen
could also be buying up senior bank debt, due in May.

Echostar could be pursuing a plan to use the debt as a way take
control of the company either inside or outside of bankruptcy. Either
way, current shareholders would be left with nothing. 

With about $925 million in debt coming due this year, Sirius is up
against a wall. It also owes $43 million for programming fees to the
National Football League on Feb. 17, plus $60 million to Major League
Baseball in March. The MLB cash is in escrow, and a person familiar
with the matter says that the company is negotiating hard with the
league to let Sirius tap those funds.

Mr. Ergen’s debt gambit comes as his primary business, the Dish
satellite-to-home network, faces escalating problems in an increasingly
competitive environment. Dish has suffered a net loss of subscribers
during some months, and continues to fall behind satellite- and
cable-television providers in attracting new customers. Although Sirius
and EchoStar have differently designed satellite systems that could be
difficult to combine, Sirius also has a network of ground facilities
that could be important to EchoStar.

Mr. Ergen has long sought such a footprint on the ground. Over the years, Mr. Ergen
has tried but failed to expand his core business. He has dabbled in
providing Internet service to rural homes, talked about becoming a
major provider of wholesale satellite capacity and looked at ways to
meld satellite and ground systems to provide entertainment to mobile
devices. But for the most part, those efforts haven’t taken off, and
Mr. Ergen has told associates that EchoStar was looking for a new
strategy.

An EchoStar spokesman declined to comment. Sirius didn’t immediately respond to a request for comment.

[Via: WSJ.com Subscription Required to View Whole Article]

So this is all speculation right now but if Sirius starts sinking (which has been happening anyways) it looks like Echostar may be the first company to come and save the failing company. There is just one small issue….Echostar is not in much better shape and definitely not a company I would want to see take over Sirius XM Radio!

Sirius XM has a ton of thinking to do if it want’s to stay successful in the near future, and it’s going to need to be something more then just raising rates for it’s subscribers.