|
9601 S. Meridian Blvd. Englewood, CO 80112 CO Tel. 303-723-1000 Fax 303-723-1999 |
Type: Public
On the web:
http://www.dishnetwork.com
Employees:
34,000
Employee growth: 54.5%
DISH Network serves up fare intended to whet everyone's appetite for televised entertainment. The #2 provider of satellite-based pay-TV in the US (behind DIRECTV), the company serves about 14 million subscribers, which includes business clients in such industries as hospitality, restaurant, and retail. Programming includes premium movies, SIRIUS radio, on-demand video service augmented by its Blockbuster assets, regional and specialty sports, local and international channels, and pay-per-view in addition to basic video programming. It offers bundled voice and Internet services through partnerships with voice and data communications providers. Co-founder and chairman Charlie Ergen controls about 90% of the company.
Key numbers for fiscal year ending December, 2011:
Sales: $14,048.4M
One year growth: 11.1%
Net income: $1,515.9M
Income growth: 53.9%
Officers:
Chairman: Charles W. (Charlie) Ergen
President, CEO, and Director: Joseph P. Clayton
EVP and COO: Bernard L. (Bernie) Han
Competitors:
Comcast
DIRECTV
Time Warner Cable
Incorporated: 1993
NAIC: 513220 Satellite Television Distribution Systems
EchoStar Communications Corporation is perhaps best known for its direct broadcast satellite (DBS) system, DISH Network, which was launched in 1996 and quickly became the fastest growing satellite TV service in the United States. The company also operates three interrelated business units. Satellite Services oversees satellite uplink, transponder space-usage, and other services for television customers and other satellite users. EchoStar Technologies Corporation designs, manufactures, and distributes DBS reception equipment (set-top boxes and antennas). The third unit, EchoStar International Corporation, is headquartered in the Netherlands and provides a range of satellite-related services throughout Europe, Africa, the Middle East, Australia, and Asia.
The company that became EchoStar was founded by Charles Ergen in 1980 as a small retail store that sold direct-to-home satellite television products and services. During the 1980s it was primarily a manufacturer and distributor of C-band hardware. C-band satellites were used primarily to broadcast shows to cable system operators, not to individuals, because reception equipment cost about $2,500 and included a ten-foot dish antenna. By the mid-1980s the company, known as Echosphere Corp., was a leading supplier of direct-to-home hardware and services worldwide.
Foreseeing changes in the satellite industry, Egren applied to the Federal Communications Commission (FCC) in 1987 for a direct broadcast satellite (DBS) license. In 1992 EchoStar won a license to broadcast from one of three slots within the broadcasting range of the entire continental United States. The slot, among eight set aside by the FCC, was located above the city of Los Angeles. EchoStar Satellite Corp. was established to build, launch, and operate the company's satellites.
In December 1993 EchoStar Communications was incorporated in Nevada, with headquarters in Englewood, Colorado, as holding company for 13 direct and indirect subsidiaries. EchoStar claimed to lead the U.S. market for home satellite reception products, with a 30 percent domestic market share. The company had an existing distribution network of 5,000 dealers. For 1993 revenues from subsidiaries were $220.9 million, 33.8 percent more than 1992, with net income of $20.4 million, nearly double 1992's net income of $10.8 million.
In January 1994 EchoStar made arrangements with DirectSat Corporation, a subsidiary of SSE Telecom that had also won a license to put a satellite above Los Angeles, to pool their licenses and resources to offer 110 channels of television, 250 audio channels, and data feeds of financial and weather information.
In 1994 EchoStar offered $624 million in senior secured notes along with 3.7 million common stock purchase warrants. Proceeds to the company were about $335 million. These so-called 'junk bonds' had an interest rate of nearly 13 percent, with payment deferred until 1999. The proceeds would be used primarily to construct, launch, insure, and operate two direct broadcast satellites to be built by Martin Marietta Corp. (later Lockheed Martin Corp.) for $159 million. The launches were planned to take place in China in 1995 and 1996, with insurance costing $206.3 million.
If successful, the two satellites would be worth $881 million once service was initiated. The two satellites would enable EchoStar to begin broadcasting more than 100 channels of television programming to 18-inch receiver dishes that cost an estimated $500 each. The company's target audience would be the 11.5 million American households not wired for cable and 20.4 million households wired for cable but with limited channel capacity.
AT & T would operate EchoStar I and provide tracking, telemetry, control, and maintenance services for the satellite. AT & T would also provide consulting services to Martin Marietta, the satellite's builder. It was unclear at first who would supply the receiving equipment for consumers. At this point, access to the 18-inch satellite receiver was controlled by DirecTV, a subsidiary of General Motors' Hughes Electronics Corp.
In 1995 EchoStar was building a $50 million uplink facility in Cheyenne, Wyoming, that would be operational by August 1995, and EchoStar I was scheduled to launch October 1, 1995. The company was busy lining up programming. Its initial hardware would consist of an 18-inch dish, set-top box, and remote. It intended to compete directly with the Digital Satellite System offered by Thomson Consumer Electronics and DirecTV.
EchoStar issued a prospectus for a four-million share initial public offering (IPO) in July 1995. By August 1995 EchoStar had signed programming deals with Viacom to carry its basic and premium channels, including Showtime, The Movie Channel, MTV, VH1, and Nickelodeon. It also had signed deals with HBO, CNN, The Disney Channel, Turner Classic Movies, ESPN, C-SPAN, and The Learning Channel.
EchoStar's initial satellite launch was delayed because of problems with its Chinese partner, China Great Wall Industry Corp., which had experienced two launch failures in 1995. Meanwhile, DBS competitors DirecTV, which was owned by General Motors' Hughes Electronics Corp., and Primestar, which was owned by a consortium of cable operators that included TCI Inc. and Time Warner, were mounting extensive marketing campaigns to gain market share.
The company's first satellite was launched from China on December 28, 1995. EchoStar also acquired more channels by purchasing the 22 channel assignments of Direct Broadcast Satellite Corporation (DBSC) for $8 million. EchoStar had acquired a 40 percent interest in DBSC in 1994 and in 1996 acquired the remaining 60 percent for an estimated $23 million.
EchoStar's DBS service would be called the DISH TV Network, with DISH standing for Digital Sky Highway. The service was scheduled to launch in February 1996 with 100 channels. It would compete directly with DirecTV and less directly with Primestar, which required a larger dish and had fewer channels.
At the beginning of 1996 the FCC auctioned two blocks of DBS channels, one of which went to MCI and the other to EchoStar. EchoStar's slot was too far to the west to be able to service the east coast, while MCI purchased the last DBS slot with full coverage of the continental United States. MCI and News Corp. were planning a joint satellite venture to be called American Sky Broadcasting Co. (ASkyB).
When EchoStar began offering DBS service in spring 1996, there were three competitors already offering similar services: DirecTV, United States Satellite Broadcasting, and Primestar. EchoStar was the only DBS service to have the capacity for two national DBS systems. Its receivers would be made by the French manufacturer Groupe Sagem and American company, SCI Systems. Philips would market EchoStar DBS dishes under its Philips and Magnavox brands.
EchoStar previewed its DISH TV Network at a trade show in March 1996, and by May the service was rolled out to consumers, who could chose from five programming packages with monthly fees ranging from $19.99 to $59.99. At the same time the company launched a $40 million advertising campaign to promote the DISH Network. By June 1996 EchoStar claimed to have 50,000 subscribers. The company would continue to offer various price promotions to gain subscribers. EchoStar was adding about 1,500 subscribers per day and forecast up to 400,000 subscribers by the end of 1996. DISH Network reached 100,000 subscribers by August 1996. EchoStar was offering its satellite dish and programming for low prices, and the competitors were soon forced to lower their prices as well.
EchoStar II launched on September 10, 1996, from French Guiana, doubling EchoStar's channel capacity from 80 to 160. The company added two new basic packages: America's Top 40, which consisted of 40 basic networks for $19.95 a month, and America's Top 50, which included a 30-channel audio feed plus ten more channels, for $24.99.
In November 1996 EchoStar introduced a new promotion with computer manufacturer Gateway Inc. Customers who purchased certain Gateway computers would receive a coupon for a free satellite receiver system with the purchase of one year of DISH Network programming. The company would continue to use free dish promotions as an integral part of its marketing programs to attract new subscribers to DISH Network TV.
The company added 65,000 subscribers in December 1996, its strongest month, giving the DISH Network 350,000 subscribers by year's end. Meanwhile, DirecTV added 165,000 subscribers in December, giving it 2.3 million subscribers at year's end.
Seeking to expand its services beyond DBS, the company began entering into agreements for more satellites, and fixed satellites. The fixed satellite business required a higher degree of capitalization than EchoStar could command, and the company was admittedly seeking financial partners, among them TCI Satellite Entertainment. By February 1997 the company had $800 million of debt on its balance sheet. Its stock hit a 52-week high of $37 in February 1996, but a year later was worth about 60 percent less. It reached a 52-week low of $15 on January 29, 1997.
By the end of February 1997 it appeared that EchoStar had found its financial partner in Rupert Murdoch and News Corporation Limited. Murdoch was in the process of building an uplink center in Arizona for his proposed joint venture with MCI Worldcom, American Sky Broadcasting (ASkyB). Murdoch's News Corp. planned to buy a 40 percent stake in EchoStar for about $1 billion. The deal would give EchoStar seven satellites able to deliver 500 channels, including the capacity to carry local stations. As part of the deal, MCI would own ten percent of EchoStar. The remaining 50 percent of EchoStar would be retained by the company's shareholders. Under the terms of the agreement, Ergen would continue as CEO of EchoStar, and Murdoch would become chairman. EchoStar quickly announced it would invest $500 million to build eight regional uplink centers with the capability of delivering local broadcast channels. Analysts agreed that DBS service, which included local stations, would be the first really serious threat to cable television.
The proposed merger with News Corp.'s satellite business was soon running into opposition. News Corp. had failed to obtain permission from broadcasters to retransmit their signals, and the FCC was being asked to deny the ASkyB-EchoStar merger. When Murdoch insisted on management control over the merged company, the deal came undone. With News Corp. and EchoStar disagreeing on several technical issues, EchoStar went to court to force News Corp. to make good on a $200 million interest-free loan that was part of the merger agreement. Murdoch countered by insisting that Ergen resign as CEO and give up management of the venture. On May 9, EchoStar sued News Corp. for breach of contract, claiming $5 billion in damages, with News Corp. filing a countersuit the next month. Meanwhile, News Corp. and Primestar reached an agreement in principle to merge their DBS operations, but that proposed merger was also subsequently called off by federal regulators.
EchoStar continued to seek financial partners and filed with the SEC for a $378 million debt offering, in part to raise an additional $305 million to cover the costs of four planned satellites. As it negotiated with Lockheed Martin to reschedule its payments, the company's debt reached $1.2 billion.
The company began a new promotion on June 1, 1997, whereby consumers could purchase EchoStar hardware for $199 without buying an annual subscription, subscribing on a monthly basis instead. By mid-1997 EchoStar had 590,000 subscribers and was adding nearly 50,000 new subscribers a month. EchoStar III launched in October 1997 from Cape Canaveral, Florida, and would serve primarily the east coast of the United States. The company also purchased 32.2 acres and a 190,000-square-foot building in Littleton, Colorado, for its new campus-style corporate headquarters for $7.5 million.
A $99 installation promotion resulted in 105,000 new subscribers in September. By the end of October EchoStar had 895,000 subscribers and was warning that a shortage of receivers would temporarily limit the number of new subscribers. However, the company had met its financing needs by raising more than $650 million through debt and equity offerings since its proposed merger with News Corp. fell through. The company reached an agreement with Sears, Roebuck & Co. to offer its $199 package in 800 Sears outlets.
For 1997 net losses rose 210 percent to $321.3 million on revenues of $477.4 million, up 140 percent. The company ended the year about $1.4 billion in debt after raising $750 million in debt during the year. The company also ended the year with 1.2 million subscribers.
In January 1998 EchoStar began beaming the local signals of the top four networks' broadcast affiliates into their respective markets in New York, Chicago, Boston, Washington, Atlanta, and Dallas, with additional cities to follow. Ten more Western cities would be added after the launch of EchoStar IV in the spring, according to EchoStar's plan to reach more than 40 percent of U.S. television households. EchoStar asked the Library of Congress to determine whether copyright law allowed the retransmission of local network signals into their market of origin by DBS satellites.
The company introduced a new Top 60 programming package in May for $28.99 per month to replace the Top 50 package, adding such channels as American Movie Classics, Bravo, and the SportsChannel, among others. New subscribers were offered a $60 credit if they submitted a copy of their latest cable bill.
EchoStar IV launched May 8, 1998, from Kazakhstan. Following the launch, the company encountered problems deploying the solar panels on the satellite. It subsequently found that one primary and one back-up transponder on EchoStar IV failed. Additional capacity was gained through an alliance with Loral Skynet to deliver niche programming through one of Loral's satellites. EchoStar was also preparing to deliver data to consumers. It was already supplying data to niche markets through AgCast, an agricultural report, and Signal, a stock report. It began competing more directly with DirecTV by offering a $100 bounty to any DirecTV subscribers who switched to EchoStar. DirecTV responded by doubling the bounty for DISH TV subscribers who switched to DirecTV.
EchoStar received permission from the FCC to broadcast local network signals to 'unserved' homes in Denver, Phoenix, San Francisco, and Salt Lake City from its EchoStar IV satellite. Industry periodical Broadcasting & Cable noted that the political climate was good for moving 'local-to-local' service ahead, because it was seen as providing competition to cable television and possibly reducing cable subscriber rates. By September it was clear that Congress was working to pass legislation that would permit satellite TV companies to deliver local broadcast signals.
In October EchoStar announced a three-month promotion to new subscribers, giving them a $249 rebate on the cost of receiving hardware in exchange for a one-year subscription to the DISH Network's America's Top 100 CD programming package. DirecTV and Primestar, which each had their own promotions going, declined to match the offer. At the beginning of the month DISH TV had about 1.6 million subscribers, compared to four million for DirecTV and 2.6 million for Primestar. EchoStar also announced that it planned to offer interactive television nationally in 1999--including e-mail and home banking--using software from OpenTV Inc. of Mountain View, California.
Seeking to clarify which households qualified to legally receive imported network signals via satellite, EchoStar brought lawsuits against the top four broadcast networks. The FCC was currently considering new rules for determining such eligibility. The four networks--ABC, CBS, NBC, and Fox--countered by filing suit against EchoStar, claiming the company sold network programming to ineligible customers.
In November 1998 DISH TV introduced BBC America as part of its America's Top 100 CD package. It was the first satellite carriage of the channel, a joint venture between the BBC and the Discovery Networks. EchoStar was also negotiating with cable operators to provide them with a digital satellite supplement to their regular cable offerings. Targeted were small cable operators with largely rural systems.
In December 1998 News Corp. agreed to sell its satellite television assets to EchoStar, which would increase EchoStar's channels from 200 to 500. Under terms of the agreement, EchoStar would pay $1.25 billion to buy the DBS assets of the MCI Worldcom-News Corp. venture, American Sky Broadcasting (ASkyB). The stock deal would give MCI and News Corp. a 37 percent interest in EchoStar and end the litigation over the failed merger attempt in 1997. EchoStar would receive AskyB's uplink center in Gilbert, Arizona, as well as a license to operate at another orbital location, and two satellites then under construction. EchoStar also got a three-year retransmission deal to carry Fox Network's local signals and agreed to carry the Fox News Channel. Following the merger, EchoStar would control more than half the satellite slots over the United States. With FCC approval of ASkyB's license transfer to EchoStar, the deal closed in June 1999, with EchoStar issuing 8.6 million shares of Class A stock.
Competitor DirecTV responded by acquiring its longtime partner, U.S. Satellite Broadcasting Co., for $1.3 billion in December 1998. The acquisition gave DirecTV an improved programming package and 200,000 new subscribers. In January DirecTV announced it would acquire rival Primestar for $1.82 billion, leaving DirecTV and EchoStar as the number one and two DBS providers. subscribers. EchoStar saw an opportunity to pick up Primestar's old subscribers and offered a $200 bounty to its dealers for every Primestar customer they could switch to DISH TV. Analysts estimated that as many as 1,000 Primestar customers per day were switching to DISH TV.
In an effort to provide interactive television services, EchoStar announced a partnership with Microsoft's WebTV to include the WebTV Network Plus Internet TV service in a new generation of EchoStar integrated receiver/decoders that would be available in spring 1999. The service would deliver Web page content to viewers and allow them to pause a program for up to 30 minutes before resuming it. In June EchoStar rolled out its DISHPlayer, a satellite receiver with an integrated WebTV service that allowed users to surf the Internet, send e-mail, and play video games. The DISHPlayer was priced at $199, plus a subscription fee for programming service and another extra fee for Internet access.
In March EchoStar surpassed the two million subscriber mark for DISH TV. With federal cable rate regulations expiring in March 1999, lawmakers were seeking to find ways to increase competition for cable, rather than extend the rate regulations. In May a House bill on satellite reform passed that would allow DBS companies to provide a programming package that included local programming. For the rest of the year the Satellite Home Viewer Act (SHVA) would be the subject of intense lobbying on the part of satellite providers, cable operators, television station owners, and cable and broadcast networks. Hurdles to offering local-into-local service included passage of appropriate legislation, FCC approval of orbital license transfers, and retransmission deals with every local broadcaster.
In June EchoStar was recognized by President Bill Clinton for providing satellite dishes and 40 hours of school safety programming to school districts across the country. The company's stock reached a 52-week high of $142.63 and later rose to more than $176 before settling around $151.
By the end of August 1999 EchoStar had 2.84 million DISH TV subscribers. EchoStar V was launched on September 23, 1999, from Cape Canaveral. Following a stock split EchoStar's stock was trading at a 52-week adjusted high of $88.25.
In November SHVA passed Congress and was signed into law by President Clinton. It gave DBS providers like EchoStar and DirecTV permission to offer local broadcast channels to their subscribers in those local markets. As a result, satellite TV subscriptions were expected to grow by 2.5 million subscribers in 2000. Local delivery in the top 30 markets was expected to begin as soon as possible. EchoStar was immediately able to provide full market coverage in 13 cities covering 31 million homes, with other cities to follow, while DirecTV offered local broadcast affiliate programming to nearly 12 million households in New York and Los Angeles with other markets to follow. In December 1999 EchoStar had nearly 3.5 million subscribers, and by April 2000 that number had reached four million. For 1999, the company reported a record $1.6 billion in revenues.
Plans for 2000 included up to six new satellites, as well as plans to market set-top boxes capable of recording live television programs without the use of tape. Although EchoStar had yet to show a profit since becoming a DBS provider, the company was positioned to take advantage of the new regulatory climate of the 21st century. Following passage of SHVA in 1999, DBS companies would be able to compete more effectively with cable television operators. Industry consolidation left EchoStar the number two satellite television operator, behind industry leader DirecTV. Both would be competing for market share in the years to come.
Principal Subsidiaries
EchoStar Technologies Corporation; EchoStar International Corporation (Netherlands).
Principal Operating Units
DISH TV Network; Satellite Services.
Principal Competitors
DirecTV.
Further Reading
Albiniak, Paige, and Bill McConnell, 'EchoStar Loses One, Wins Another at FCC,' Broadcasting & Cable, June 21, 1999, p. 19.
Albiniak, Paige, 'At Long Last, Local,' Broadcasting & Cable, November 29, 1999, p. 4.
Bloomfield, Judy, 'EchoStar's Big Sky,' HFN--The Weekly Newspaper for the Home Furnishing Network, March 3, 1997, p. 43.
Brull, Steven V., 'Now, Beam up Some Customers,' Business Week, December 28, 1998, p. 52.
Colman, Price, 'Echoes of Slowdown at EchoStar,' Broadcasting & Cable, February 10, 1997, p. 48.
------, 'EchoStar, DirecTV Battle for Eyeballs,' Broadcasting & Cable, August 31, 1998, p. 43.
------, 'EchoStar Unbundles,' Broadcasting & Cable, June 2, 1997, p. 70.
Dickson, Glen, 'Sat TV Goes Interactive,' Broadcasting & Cable, January 11, 1999, p. 15.
Fehr-Snyder, Kerry, 'News Corp.-EchoStar Deal Raises Real Threat for Cable Television Systems,' Knight-Ridder/Tribune Business News, February 27, 1997.
Fleming, Heather, 'Sky's Future Still Cloudy,' Broadcasting & Cable, April 28, 1997, p. 8.
Hutheesing, Nikhil, 'Kamikaze Satellites?,' Forbes, July 4, 1994, p. 126.
Littleton, Cynthia, and Harry A. Jessel, 'Murdoch, Ergen Take to Sky,' Broadcasting & Cable, March 3, 1997, p. 41.
Locke, Tom, 'EchoStar Takes Debt Public,' Denver Business Journal, March 25, 1994, p. 3A.
Marchand, Nolan, 'EchoStar Gets More Customers for Dish,' Broadcasting & Cable, September 20, 1999, p. 62.
McCarthy, Shira, 'EchoStar Shines On,' Telephony, October 7, 1996, p. 48.
McConnell, Bill, and Paige Albiniak, 'Clinton Praises EchoStar,' Broadcasting & Cable, June 14, 1999, p. 22.
McConville, Jim, 'New Bird Boosts EchoStar Capacity,' Broadcasting & Cable, October 28, 1996, p. 113.
Mundy, Alicia, 'EchoStar Woos Rival's Subs,' Mediaweek, February 1, 1999, p. 5.
Noer, Michael, 'Pie in the Sky,' Forbes, October 9, 1995, p. 12.
Peers, Martin, 'Wrapped up in Suits, Echo Grows Fainter,' Variety, May 19, 1997, p. 24.
Peers, Martin, and Joe Flint, 'Rupert Hears an Echo: The Sky is Falling,' Variety, May 5, 1997, p. 1.
Perman, Stacy, 'EchoStar's New Orbit,' Time, March 10, 1997, p. 56.
Quittner, Joshua, 'My Neighbor's Dish,' Time, June 7, 1999, p. 84.
Roberts, Johnnie L., 'Rupert's Death Star,' Newsweek, March 10, 1997, p. 46.
Stern, Christopher, 'EchoStar Banks on Ergen-omics,' Variety, July 12, 1999, p. 29.
Veilleux, C. Thomas, 'EchoStar Beams In,' HFN-The Weekly Newspaper for the Home Furnishing Network, March 11, 1996, p. 77.
------, 'EchoStar DBS Alternative to Bow,' HFN-The Weekly Newspaper for the Home Furnishing Network, November 14, 1994, p. 84.
— David P. Bianco
Logo used since February 2012 |
|
| Type | Public company |
|---|---|
| Traded as | NASDAQ: DISH |
| Industry | Satellite television |
| Founded | March 4, 1996 (as Dish Network) |
| Founder(s) | Charlie Ergen Candy Ergen Jim DeFranco[1] |
| Headquarters | Meridian, Colorado[1], USA |
| Area served | United States |
| Key people | Charles W. Ergen (Chairman) Joseph P. Clayton (President & CEO) |
| Products | Direct broadcast satellite, Pay television, Pay-per-view |
| Revenue | |
| Operating income | |
| Profit | |
| Total assets | |
| Total equity | |
| Employees | 34,000 (2011)[2] |
| Subsidiaries | Blockbuster LLC, DBSD North America, Inc. & Liberty Bell Telecom |
| Website | www.dish.com www.dishonline.com |
Dish Network Corporation (NASDAQ: DISH) is the largest United States satellite broadcaster,[3] providing direct broadcast satellite service—including satellite television, audio programming, and interactive television services—to 14.337 million[4] commercial and residential customers in the United States. Dish Network has approximately 24,500 employees, most of which are located within the U.S. The corporate office is based in Meridian, Colorado, though the postal designation of Englewood is used in the company's mailing address.
Echostar Satellite L.L.C. was founded by Charlie Ergen, his wife Candy and their friend Jim DeFranco as a satellite television equipment distributor in 1980. Echostar was officially re-branded as Dish Network in March 1996. This branding came after the successful launch of its first satellite, Echostar I in December 1995 and marked the beginning of the company offering subscription television services. The company has since launched numerous satellites, with 14 owned and leased satellites currently[when?] in its fleet.
As of January 2008[update], Dish Network split from Echostar, with each entity becoming a separate company. Echostar is the key technology partner to Dish Network, which focuses only on marketing and providing satellite television service. Since June 20, 2011, Joseph Clayton has had day-to-day control of the company.[5]
Dish's owner Charlie Ergen has made diversifying and update the company's technology a high priority. He told the Milken Institute Global Conference in May 2012 that over the next ten years, he plans on transforming the company into a single company that will provide internet, video and phone service for both home and mobile applications. Ergen feels that no other company has successfully accomplished this.[6]
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Contents
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Dish Networks main service is satellite television. Its offerings are similar to other satellite and cable companies. Viewers can choose from a series of service bundles, paying more money for more channels. A la carte programming is not available, except for premium TV stations.
The company is currently working on diversifying its offerings. With its purchase of Blockbuster Video, it now runs the Blockbuster stores and has used its intellectual property agreement to offer streaming and mail-order video services.
DishOnline is Dish Network's subscriber-only streaming video service, which includes HBO and Cinemax programming.[7]
In May 2012, Dish began offering a DVR with what it calls Autohop. The device would automatically skip commercials when displaying programming that the viewer had previously recorded with the PrimeTime Anytime feature. It does not skip ads on any live programs. Broadcasters were angered at the news, and FOX stated they were evaluating legal action.[8]
Also, in May 2012, Dish launched the service DishWorld on the Roku streaming player. This broadband service provides international programming to subscribers of the DishWorld service. Customers do not need to be a satellite or cable customer to subscribe.[9][10]
Dish Network officially began operations in March 1996 as a service of EchoStar. EchoStar was formed in 1980 by its chairman and chief executive officer, Charles Ergen along with colleagues Candy Ergen and Jim Defranco, as a distributor of C band satellite television systems. In 1987, EchoStar applied for a direct broadcast satellite broadcast license with the Federal Communications Commission and was granted access to orbital slot 119° west longitude in 1992.[11]
On December 28, 1995, EchoStar successfully launched its first satellite, EchoStar I. With this and the completion of the construction of the satellite uplink center in Cheyenne, Wyoming, The Dish Network brand name was born to represent the home satellite TV service. In March 1996, the company made its first broadcast to customers.
In 1998, EchoStar purchased the broadcasting assets of a satellite broadcasting joint venture of News Corporation's ASkyB and MCI Worldcom. With this purchase EchoStar obtained 28 of the 32 transponder licenses in the 110° West orbital slot, more than doubling existing continental United States broadcasting capacity at a value of $682.5 million. The acquisition inspired the company to introduce a multisatellite system called Dish 500, theoretically capable of receiving more than 500 channels on one Dish. In the same year, Echostar, partnering with Bell Canada, launched Dish Network Canada.
In January 1999, the company released the industry's first High-definition television (HDTV) tuner. In August 2003, the company launched Echostar IX, the first satellite equipped with commercial Ka band payload for broadband service over the United States. This led the company in 2004 to be the first satellite TV service to offer local channels to all 50 states. In that year, the company also introduced the nation's first interactive TV multiple picture-in picture application for the Olympic Games, offering coverage from multiple channels at once. This year the company also acquired its 10 millionth customer.
In January 2005, EchoStar bought the broadcasting assets of the troubled HDTV satellite provider Voom, including its Rainbow 1 satellite co-located with EchoStar 3 at 61.5° West. On April 29, EchoStar announced that it would expand its HDTV programming by adding the first 10 of 21 original Voom channels and mirror the channels on a CONUS slot. Dish Network added CNN HD in Spanish along with other packages in its Latino HD lineup.
On January 1, 2008, the company completed its spinoff of its technology and set top box business into a separate publicly traded company, Echostar Corporation ("Echostar"), effectively splitting the original Echostar into two separate businesses.[12] Dish Network Corporation, the larger of the two resulting companies, focuses on programming, service and marketing of satellite television, while EchoStar Corporation runs a majority of the satellite fleet and other signal infrastructure. While neither company has any ownership in the other, the majority of the voting power of the shares in both companies is owned by Charlie Ergen.
In 2011, Dish Network spent over $3 billion dollars in acquisitions of companies in bankruptcy,[13] which Motley Fool's Anders Bylund described as "a veritable buying rampage in the bargain bin."[14] This includes the April 6, 2011, purchase of Blockbuster Inc. in a bankruptcy auction in New York, agreeing to pay $322 million in cash and assume $87 million in liabilities and other obligations for the nationwide video-rental company.[15] Dish Network also acquired the defunct companies DBSD and Terrestar.[13] Dish Network also made a bid to purchase Hulu on October 2011, but Hulu's owners chose not to sell the company.[16] There is also speculation that Dish Network might purchase Sprint or Clearwire[17] CEO Charles Ergen plans on adding wireless internet and mobile video services that can compete with Netflix and cable companies.[13] About the new markets, Ergen said, "Given the assets we've been accumulating, I don't think it's hard to see we're moving in a different direction from simply pay-TV, which is a market that's becoming increasingly saturated."[13]
Dish Network put its Blockbuster acquisition to work by announcing Blockbuster movie pass, which allows on-demand movies, game and DVD rentals, and online streaming services for a flat monthly fee. Dish Network plans a similar services for non-Dish Network customers. As Blockbuster had agreements that allow it to receive DVDs 28 days earlier than Netflix, the new service could be major competition.[13]
Dish Network also plans on offering high-speed internet. The company plans a hybrid satellite/terrestrial mobile broadband service. In 2011, it petitioned the FCC to combine the S-Band spectrum it acquired from DBSD and Terrestar, and combine this spectrum with LTE. Unlike Lightsquared, Dish's spectrum has minimal risk of disrupting Global Positioning Systems.[18]
At the 2012 Consumer Electronics Show, Dish Network announced that they would be dropping the “Network” and going solely by Dish (along with a new logo) in their marketing. Dish Network's parent company will remain "Dish Network".[19]
Dish Network offers different types of satellite receiving equipment for obtaining signals from its diverse satellite fleet. Most of their consumer boxes are manufactured by Sanmina-SCI Corporation to EchoStar specifications. Prior to the December 2001 merger of SCI Systems and Sanmina, Dish Network receivers were produced at factories in Huntsville, Alabama and Fountain, Colorado. Currently,[when?] receiver assembly takes place in Guadalajara, Mexico and India.
Dish Network's first satellite antenna was simply called the "Dish Network" Dish. It was retroactively named the "Dish 300" when legal and satellite problems forced delays of the forthcoming Dish 500 systems. It uses one LNB to obtain signals from the 119°W orbital location,[20] and was commonly used as a second Dish to receive additional high-definition or ethnic programming from either the 148°W or 61.5°W orbital locations.[21][22] The 119°W slot is one of two primary orbital locations, the other being 110°W, that provide core services.[23][24]
After EchoStar obtained the broadcasting assets of a failed joint venture between ASkyB and MCI WorldCom, it had more than doubled its capacity by adding 28 transponders at the 110°W orbital location. Since EchoStar also owned the adjacent 119°W orbital location it developed the Dish 500 to receive the signals of both orbital locations using one Dish and an innovative dual-LNB assembly. Although the new 20-inch Dish 500 was slightly larger than the then-current 18-inch Dish 300 and DirecTV Dishes it had the distinct advantage of obtaining signals from EchoStar's two adjacent satellite locations for a theoretical 500-channel capacity. The Dish 500, as a result, provided very large capacity for local-into-local service, nationwide programming, and business services. In order to migrate existing customers to Dish 500, Dish Network provides value-added channels in addition to local channels that can only be received with the Dish 500 and newer systems. Some of these channels exclusive to these newer systems are H2, Boomerang, Science, Planet Green, and Comedy Central.
In spite of all this capacity, EchoStar still needed to fulfill the dream of nationwide high-definition television and conceived the Dish 1000 system to receive signals from 110°W, 119°W, and 129°W orbital locations. Originally, Dish Network high-definition subscribers required two separate satellite dishes. Currently, Dish Network subscribers can receive nationwide HDTV channels using the 129°W orbital location or 61.5°W orbital location. Because of issues with low signal strength, the older model Dish 1000 has been replaced with the Dish 1000.2. The 1000.2 has a 10% larger reflector for better signal strength and an integrated LNB for easier installation. The Dish 1000.2 is 23 in (580 mm) in diameter. Even with the larger size, there are still many reports of customers consistently losing signal on the 129°W orbital location. This has forced some customers to either use a 2nd separate Dish Network brand dish, or an aftermarket 30" dish, aimed specifically at the 129°W orbital location. On several satellite related web support forums, customers have critically suggested that the new Dish 1000.2 wasn't nearly large enough and should have been 20%–30% larger to properly deal with rain fade.
During Dish Network's quest for capacity, they had accumulated an array of satellite broadcasting technologies, orbital locations, and surplus capacity using non-mainstream technologies requiring larger dish sizes. To capitalize on these broadcasting assets, Dish Network started providing extensive ethnic programming from lower-powered satellites broadcasting in the non-DBS portion of the FSS band. Dish Network offers specialized equipment for these customers including larger dish antennas.[citation needed]
The SuperDish, Dish 500+, and Dish 1000+ systems receive DBS signals from both of the primary 110°W and 119°W locations (129°W for Dish 1000+) as well as lower-powered FSS signals from either 121°W, 105°W, or 118.75°W. The Dish 500+ and 1000+ systems receive circularly polarized signals in the non-DBS portion of the FSS band—the only American satellite television service to do so.
While for years Dish Network has used standard MPEG-2 for broadcasting, the addition of bandwidth-intensive HDTV in a limited-bandwidth world has called for a change to an H.264/MPEG4 AVC system. Dish Network announced as of February 1, 2006, that all new HDTV channels would be available in H.264 format only, while maintaining the current lineup as MPEG-2. Dish Network intends to eventually convert the entire platform to H.264 in order to provide more channels to subscribers. In 2007, Dish Network reduced the resolution of 1080-line channels from 1920x1080 to 1440x1080. Reducing horizontal resolution and/or data rate of HD video is known as HD Lite and is practiced by other TV providers as well.
Both a standard receiver and a receiver with built-in digital video recorder (DVR) are available to subscribers. The Dish Network ViP722 HD DVR (Record up to 350 hours of standard-definition (SD), up to 55 hours of high-definition (HD) replacement to the ViP622 has received generally positive reviews[25] from CNET and others.
Both a standard receiver and a DVR (digital video recorder) are available to subscribers for an upgrade fee. Beginning in January 2010, Dish Network charges $6.00 as a DVR service fee, which covers cost of licensing EPG (electronic program guide) from TV Guide.
Most of the satellites used by Dish Network are owned and operated by Echostar Corporation. Since EchoStar frequently moves satellites among its many orbiting slots this list may not be immediately accurate. Refer to Lyngsat and Dish Channel Chart for detailed satellite information.
| Satellite | Location (Degrees West) | Launched | Type | Notes |
|---|---|---|---|---|
| EchoStar XV | 61.5 | July 10, 2010 |
A CONUS only satellite. |
|
| Echostar XII | 61.5 | July 17, 2003 | Lockheed-Martin AS-2100 | Originally known as Rainbow 1, this satellite was launched by Cablevision/Rainbow DBS and used for the Voom DBS service at 61.5° W until the satellite and transponder licenses were sold to EchoStar in 2005. Renamed EchoStar 12 in March 2006. Currently only used for spotbeam capabilities. |
| EchoStar III | 61.5 | October 5, 1997 | Lockheed Martin Missiles and Space A2100AX | Replaced by EchoStar XV. Now serving as an in orbit spare. |
| Nimiq 5 | 72.7 | September 17, 2009 | Space Systems/Loral LS-1300 | A Canadian satellite operated by Telesat Canada. Echostar leases the satellite's capacity. |
| EchoStar VI | 77 | July 14, 2000 | Space Systems/Loral FS-1300 | Replaces EchoStar VIII. |
| EchoStar VIII | 77 | August 21, 2002 | Space Systems/Loral (SS/L) FS-1300 | Formerly at 110. On January 30, 2011, the satellite experienced a single event upset and drifted out of its intended orbit, this required all services to be relocated to other available satellite capacity in the Eastern Arc. One week later some services were restored, but the satellite is expected to be taken out of service again and replaced temporarily by EchoStar VI in order to conduct further testing. |
| EchoStar I | 77 | December 28, 1995 | Lockheed Martin Astro Space Series 7000 (AS-7000) | Can carry a limited number of services on odd numbered transponders. Used for Dish Network Mexico. EchoStar is not licensed to serve CONUS customers in the United States from this location but may transmit local stations. |
| EchoStar IV | 77 | May 8, 1998 | Lockheed Martin Missiles and Space A2100AX | This satellite had a launch issue, is now in an inclined orbit and is not currently[when?] operational. It largely serves as a placeholder for EchoStar slots. |
| EchoStar X | 110 | February 15, 2006 | Lockheed Martin Missiles and Space A2100AX | |
| EchoStar XI | 110 | July 16, 2008 | SS/L 1300 | |
| Anik F3[26] | 118.75 | April 12, 2007 | Astrium Eurostar 3000 | Customers use the 36 inch Dish 500+ or Dish 1000+ to receive this non-DBS, medium-powered signal. Anik F3 is leased by EchoStar from Telesat Canada to serve CONUS customers. It broadcasts on non-DBS FSS frequencies (~11.7-12.2GHz) using circular polarity (the only satellite serving the United States in this mode). It permanently replaces AMC-16, which was temporarily placed at 118.75° W due to delays in Anik F3 production. AMC-16 moved back to 85° W when Anik F3 was fully operational. A primarily international satellite with international channels once on 61.5, 121, or 148. |
| EchoStar VII | 119 | February 21, 2002 | Lockheed Martin Missiles and Space A2100AX | Currently[when?] an on orbit spare. Provides Dish Network's spot beam services to the western United States, as well as Muzak programming to businesses on leased bandwidth. |
| Echostar XIV | 119 | March 20, 2010 | Space Systems/Loral FS-1300 | Replaced Echostar VII. |
| EchoStar IX/ Galaxy 23 | 121 | August 7, 2003 | Space Systems/Loral FS-1300 | Customers use SuperDish 121 to receive this non-DBS, medium-powered signal. Satellite is jointly owned by EchoStar and Intelsat. The Ku band is owned by EchoStar. Ka band payload owned by EchoStar and is used for leased closed-circuit broadcasts as of March 2011. C band payload owned by Intelsat and is known as Galaxy 23. Non-DBS Programming has now[when?] been removed from EchoStar IX and is being provided from 118.7 |
| Ciel-2 | 129 | December 10, 2008 | Thales Alenia Space Spacebus-4000C4 | Replaced Echostar-V at the 129°W orbital location. Owned by Canadian Ciel Satellite Group, EchoStar leases the entire bandwidth of the Ciel-2 satellite. Provides national HD programming and HD spotbeam locals. |
| EchoStar V | Deorbited from 148 | September 23, 1999 | Space Systems/Loral FS-1300 | EchoStar V was moved from 110 to 129 and finally to 148. International programming at 148 has moved to Anik F3/118.75°. Locals have moved to spotbeams at other locations. The satellite was to serve as a placeholder for EchoStar at the 148 slot. The satellite was experiencing stability issues that made signal levels unstable for the short time it was located at 148. On July 31, 2009, all remaining programming at 148 ceased. Factors now indicate discontinuation of the 148 slot, at least for the short term, 3–4 years. |
Dish Network lost a court case in October 2006, and was forced to remove all out-of-market distant network channels for the The CW, ABC, CBS, NBC, PBS, My Network TV, Independent, ETV, TBN, Univision, Telemundo, RTN, UPN, and TWC Weatherscan ubscribers with these channels, which are outside their local area. However, these channels can still be received via All American Direct's Distant Network Package.
Dish Network independent dealers have repeatedly been charged and fined for employing illegal telemarketing tactics, such as violating do not call lists and making calls in which a live telemarketer does not connect promptly after the call is answered. Dish Network terminated agreements with some independent dealers in relation to these charges.[27][28][29] In March 2009 the Federal Trade Commission charged Dish Network and two of its dealers with multiple violations of the FTC's Telemarketing Sales Rule and the Telephone Consumer Protection Act of 1991.[30]
In 2004, thirteen states charged that Echostar, then the parent company of Dish Network, had not disclosed termination fees to potential customers and had debited customers' bank accounts for hidden fees. The company settled the lawsuit, paid $5 million, and promised to disclose all terms prior to signing contracts with potential customers.[31]
Dish Network has had a lengthy history of programming disagreements.
Dish Network began negotiations with GTN (Gay Television Network) to carry the channel. GTN sent out a press release on February 2, 2001, announcing its launch and that its channel would be carried by Dish Network. Dish Network responded by denying that any contract had been signed and that the press release was premature. The president of GTN responded by calling Dish Network "homophobic".[32][33][34] In April 2002, Dish Network signed a contract to carry GTN, renamed to Triangle Television Network, then Q Television Network.[35] As of May 29, 2009[update] Dish Network now offers the Logo channel (HD only) in an add-on package (Platinum HD) along with 10 other HD channels for a $10 monthy fee.[36]
In early 2004, CBS/Viacom has pulled its networks and local channels from Dish Network including channels from MTV Networks (MTV, Nickelodeon, VH1, etc.), BET, as well as 10 CBS O&O stations after talks with them and Echostar broke down.[37] The blackout only lasted for 2 days after both parties reached a deal.[38]
On August 4, 2009, Dish Network sued ESPN for $1 million in a federal lawsuit, alleging that it had breached its contract by not extending the same carriage terms the programmer provided to Comcast and DirecTV for ESPNU and ESPN Classic. The lawsuit claims ESPN violated the "Most Favored Nations" clause.[39]
The next day, ESPN announced they will fight the lawsuit and said in a press release: "We have repeatedly advised Dish Network that we are in full compliance with our agreement and have offered them a distribution opportunity with respect to ESPNU and ESPN Classic consistent with the rest of the industry. We will not renegotiate settled contracts and will vigorously defend this legal action, the apparent sole purpose of which is to get a better deal."[40]
Dish Network moved ESPNU from its "America's Top 250" package to its "America's Top 120" package on September 30, 2009. However they claim it has nothing to do with the lawsuit.[41]
On June 22, 2010, The Walt Disney Company (owner of ESPN) pulled ESPNews HD, Disney Channel HD, Disney XD HD and ABC Family HD from the Dish Network channel list because of Dish's "Free HD for Life" campaign, although the standard definition channels remained.[42] To this day, the HD feeds have still not been put back on the list.
On May 20, 2010, Dish Network announced that it was dropping The Weather Channel at midnight ET that day in favor of its own similar weather information channel, The Weather Cast. The switch was due to high rates that the Weather Channel demanded Dish Network to pay (the Weather Channel requested a rate increase from 11 cents per subscriber per month[43] to 12 cents.[44] As of May 24, The Weather Channel stated that it had come to an agreement with Dish Network that would result in Dish Network carrying The Weather Channel for the next several years.[45] Despite the earlier announcement that The Weather Channel would be dropped, the channel was never officially removed from Dish Network. The Weather Cast was discontinued in anticipation of a Weatherscan-based service that would provide local weather information for Dish Network customers. The financial terms of the deal remain undisclosed at this time.
On October 1, 2010, Dish Network lost FX, the National Geographic Channel, and regional FSN channels due to a dispute with Fox. The dispute stems from what Dish Network calls an "unprecedented increase" in Fox's asking price, Fox on the other hand claims that they are simply asking for fair compensation for their channels.[46] The rate dispute of Fox networks has abandoned Dish Network's viewers access to 19 Fox Regional Sports Networks and to even some other programming. Dave Shull, senior vice president of Programming for Dish Network has said "Dish Network is not going to allow Fox or any programmer to bully our customers into paying such an unconscionable price increase. Fox has a long history of trying to shake down pay TV providers, including Cablevision, Time Warner, and Bright House."[47] The network is additionally negotiating for their O&O Fox stations, and is also acting as negotiator in lieu of Local TV LLC for their affiliates, which were formerly owned by the network. However, both parties came to a long-term agreement on October 29, restoring FX, National Geographic Channel, and FSN regional networks, plus viewers will continue to see programming from local Fox & MyNetworkTV O&O channels for years to come. The financial terms of the deal were never disclosed.[48] A similar dispute happened between Fox and DirecTV.
On October 1, 2010, Dish Network subscribers lost the MSG and MSG+ regional sports networks due to a contract dispute with Madison Square Garden, Inc. MSG called on Dish Network to resume negotiations and reconsider its proposals but there was still no agreement as of April 15, 2012. MSG is linking carriage of these networks to their sister-network Fuse, which was replaced with Palladia in July 2010.
It was announced on October 29 that Belo Corporation and Dish Network were in a carriage dispute regarding rates. ABC affiliates WFAA in Dallas, Texas, KVUE in Austin, Texas, CBS affiliates KHOU in Houston, Texas, WWL-TV in New Orleans, Louisiana, Fox affiliate KMSB in Tucson, Arizona and 10 other local stations are affected. Two days later, both Belo and Dish Network reached an agreement, avoiding a service interruption. Belo had offered Dish Network an extension while negotiations were taking place. Had there been no agreement made by October 31 at midnight (all time zones[clarification needed]), Belo would have pulled these channels from Dish Network.[49] If the Fox Networks dispute would've continued throughout that time period, this combination would've created the biggest blow to Dish Network customers since Echostar's disagreement with CBS/Viacom in 2004.
On April 1, 2011, Dish Network pulled SportsNet New York (which broadcasts New York Mets games) from its channel lineup due to a carriage dispute. As a result, Dish Network becomes the only satellite provider not to carry any Regional Sports Networks in the New York area.[50]
On August 9, 2011, Dish Network pulled Inspiration Network from its channel lineup asking 10 million to continue broadcasting this channel. INSP returned to Dish Network's lineup on August 31, 2011.
On December 15, 2011, Dish Network pulled WWTV and WFQX, stations in the Northern Michigan television market owned by Heritage Broadcasting, citing "an outrageous fee increase".[51] The dispute was resolved on December 20,[52] restoring those two channels to the lineup.
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