Firms in the communications sphere seem to be constantly readjusting themselves, to find the most successful balance between size and efficiency. The most recent move involves an Englewood, Colorado outfit that is leaning toward a spin-off. There is also talk that the company may be an acquisition target.

EchoStar Communications (NASDAQ: DISH) offers satellite digital television to customers in the United States. The firm's DISH Network delivers programming to more than 13 million subscribers and subsidiary EchoStar Technologies provides dishes, set-top boxes and other digital equipment to both the DISH Network and others. EchoStar has formed alliances with Internet service providers and voice communications companies to offer combined services. Among those partners are EarthLink (NASDAQ: ELNK), Qwest Communications (NYSE: Q) and Sprint Nextel (NYSE: S).

The stock popped last week, on good news for the firm and a subsequent rumor. The first jump was on Tuesday, when the Board decided to pursue a possible separation of its businesses into two distinct publicly traded companies. EchoStar's consumer pay-TV business would continue to operate as the DISH Network and most of the firm's other technology assets would be spun-off. Shareholders would receive pro rata ownership interests in each of the new entities. Then, on Thursday, the brokerage community renewed speculation that DISH might be acquired by AT&T (NYSE: T). Oppenheimer seemed to think the move was reasonably certain. Kaufman Brothers later viewed such a transaction as possible.

What bad news did you want first? Expect the Dow index to give up the week's remaining gains today -- stock futures indicate Thursday's 387-point plummet isn't finished.

Goldman Sachs (NYSE: GS) fell overseas on reports that its North American Equity Opportunities fund has dropped more than 15 percent this year, compounding worries about GS' Global Alpha fund.

The Wall Street Journal reports that SEC regulators are reviewing the books at Goldman Sachs, Merrill Lynch (NYSE: MER) and other top brokerage firms and banks, digging for unreported losses stemming from the subprime mortgage meltdown.

The Federal Reserve and its European and Japanese counterparts all injected huge sums into their financial systems Thursday and Friday in response to the ongoing credit turmoil.

Companies reporting earnings Friday include satellite television provider EchoStar Communications (NASDAQ: DISH) and contact lens maker Bausch & Lomb (NYSE: BOL).

Japan's Nikkei average led the losses overseas, dropping 2.4%, its steepest loss since mid-March. The Dow's setback echoed throughout Europe, sending the French CAC 2% lower, London's FTSE 1.9% lower, and Germany's DAX down 1.6%.

Corporate news

Speculation that Barclays Plc (NYSE: BCS) will back out of the unprecedented banking takeover of ABN Amro Holding NV (NYSE: ABN) sent ABN shares down 4.8% overseas.

MAJOR PAPERS:

• The Wall Street Journal reported that Sprint Nextel Corporation (NYSE: S) is reviewing its options to finance the building of WiMax, a wireless broadband network; a hook-up with Clearwire Corporation (NASDAQ: CLWR) is a possibility.
• The word is out that Liberty Media Corporation (NASDAQ: LCAPA) and EchoStar Communications Corporation (NASDAQ: DISH) will make a joint bid for the satellite communications provider Intelsat, Ltd, possibly somewhere in the $4.5B-$5.5B range, the Wall Street Journal reported.
  
• The Financial Times reported that Congress removed blocks on arms transfer requests by U.K. weapons manufacturer BAE Systems plc (OTC: BAESY), acting after BAE assured them that the transfer requests were unrelated to a defunct British investigation into bribery allegations involving Saudi Arabia and BAE.
• According to Barron's Online's "Weekday Trader," Sony Corporation (NYSE: SNE) is climbing its way back to electronic prominence, but more work remains, and it may be time to take profits.

WEBSITES:

• LiveMint.com reported that Citigroup Inc's (NYSE: C) emerging markets private-equity investment arm, Citigroup Venture Capital International, will reportedly invest $1.5B in India over the next three years, the largest investment by a single private-equity investor in the Indian markets.

After a fight over how content should be distributed over satellite that led to a U.S. District lawsuit and complaints to the Federal Communications Commission, Home Box Office, Inc. and EchoStar Communications (NASDAQ:DISH) have buried that hatchet. Among other things, HBO claimed that Echostar owed it $90 million.

In place of the fight, the companies have agreed to a long-term agreement for the EchoStar DISH Network to carry HBO and Cinemax.

Time Warner Inc. (NYSE:TWX)'s fourth quarter earnings announcement made it clear how important its cable network business -- which includes HBO -- is to both revenue and operating profit. The network content unit and cable division were the stars of the quarter.

There is bound to be some friction behind Time Warner's relationship with both Echostar and DirecTV Group (NYSE:DTV). The satellite businesses compete directly with TIme Warner Cable for home TV users, but the TWX TV content unit cannot afford to walk away from the revenue that the satellite companies give it.

Interesting conflict.

Douglas A. McIntyre is a partner at 24/7 Wall St.