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Dish Network's Ergen Speaks Out On HDTV
The satellite chief also says he's 'stubborn' about TiVo.
By Swanni
Washington, D.C. (August 5, 2008) -- Dish Network said yesterday that it lost 25,000 net subscribers in the second quarter, but increased revenue due to sales of high-def related products and services.
Following the release of its second quarter report, Dish Network CEO Charlie Ergen and other company executives held a conference call with Wall Street analysts to discuss the satcaster's future plans for high-def and related issues. Here's a summary of those remarks:
Dish CEO Charlie Ergen on why the satcaster lost subscribers:
"I'd say it's probably four things that have been driving it. One is economic. Obviously the effect on housing and the total economy has some effect on you when customers can't pay their bill. They either downgrade or drop off completely and watch free TV, particularly on some of your low end type customers.
Second issue would be piracy and fraud. As you know, our system has been – has been compromised and it's compromised in two ways....Third thing then is it's really competitive – is really competitive offerings in the marketplace. The biggest being probably the phone companies and FiOS and U-Verse where there are a lot of introductory offers and offers out there that – and I think they had about 300 – close to 303,000 net additions in the second quarter. So, they have taken those some from us and some customers from others. Obviously, in the high definition front, we haven't been as competitive as we would like in the second-quarter, particularly versus DirecTV.
And finally, operational efficiencies really in two ways, one is just our total overall customer service. In terms of are we giving customers a great experience and are we doing everything right? So, customers don't have to call us and we certainly have – we certainly made some progress there."
Ergen On Which TV Provider Is the HD Leader:
"Starting as of August 1st, we were at 114 HD national channels, I believe. DIRECTV talked about being at 100 channels last year. I think the latest thing I saw, they were at 95 channels in August 1st, so they talked about last year having 100 channels. They didn't meet that goal. We were actually the first company to have today I believe 114 national HD channels, including one that's in 1080p for video on demand, so that's true video on demand. So, we've made progress there although that's in the third quarter, obviously, not in the second quarter."
Ergen On Whether Dish Can Expand HD Capacity:
"We have a satellite being launched by a Canadian company in the fourth quarter of this year that we have leased all the capacity on. That should be operational by the first of next year. We then have Echo14 launching, I think, the end of next year. Then we have Echo15 in 2010. I think it's reasonable to expect that we would launch something in the neighborhood of one satellite per year, end up with 10 satellites in our fleet that are operational. And they – while they have 12 to 15 year lifetime, I think we're on a kind of a path of one a year to add capacity."
Ergen on Whether Dish Will Add More HD In 2008:
"I think as soon as the next satellite gets turned on, we have a chance to be more aggressive than we are today. We're a little bit more aggressive today, obviously, and we're doing a couple of different things. The first big thing we do, we have the only 8-All HD package. So, if you're going to buy an HDTV set and you don't want to put anything on it that is not HD, we're the only guys that have the system for you to do that, right, and it starts with less than $1 a day. So, that's pretty aggressive. But, its aggressive in a way that it's – from a pricing point of view, it's pretty aggressive from a packaging – program and packaging point of view as well. If you go to a cable company, before you can get it – you'd probably be buying $50 of products before you get your first HD channel. It's a kind of add-on tier. So, it's competitive in that market."
Ergen On 1080p PPV HD Movies
(Dish last Friday began showing PPV HD movies in what it calls 1080p high-def video -- the same resolution as Blu-ray.)
"But, we have 10 or 15 channels probably in 1080p that we'll put up... Realize that we're starting with pay per view movies, our video on demand. So, the way that works is we don't actually need – we don't need a lot of capacity for that because we actually download that in the middle of the night, that capacity to your hard drive, so it doesn't take up a full linear channel while we do that and then the video on demand movies is there, so, I Am Legend, or whatever, the first movie that we started with, that just got downloaded to everybody in the middle of the night. It takes us a couple of hours to download it and then it was done. No more capacity was needed for that movie in 1080p. So, there's not any question, and I think you probably hear the same thing from DIRECTV but the satellite industry is going to be over delivered the best quality of HD and the satellite industry going to be able deliver the most channels.
Ergen on Dish's DVR Patent Case vs. TiVo
(TiVo won its patent case in a Texas court, but there will be a September 4 hearing to assess the status ot the case.)
"At some point, I believe we'll prevail. But TiVo, we're going to have conversations with TiVo one way or the other about how we work together. And again, it's, I'm just stubborn. I know this case inside and out, I've sat through trials, I've sat through the engineering models, I've sat and have the best and the brightest explain this – and I'm just stubborn. We don't violate their intellectual property today and I want to prove that. And so, we're going to go to the September 4th hearing and see who's right.
The satellite chief also says he's 'stubborn' about TiVo.
By Swanni
Washington, D.C. (August 5, 2008) -- Dish Network said yesterday that it lost 25,000 net subscribers in the second quarter, but increased revenue due to sales of high-def related products and services.
Following the release of its second quarter report, Dish Network CEO Charlie Ergen and other company executives held a conference call with Wall Street analysts to discuss the satcaster's future plans for high-def and related issues. Here's a summary of those remarks:
Dish CEO Charlie Ergen on why the satcaster lost subscribers:
"I'd say it's probably four things that have been driving it. One is economic. Obviously the effect on housing and the total economy has some effect on you when customers can't pay their bill. They either downgrade or drop off completely and watch free TV, particularly on some of your low end type customers.
Second issue would be piracy and fraud. As you know, our system has been – has been compromised and it's compromised in two ways....Third thing then is it's really competitive – is really competitive offerings in the marketplace. The biggest being probably the phone companies and FiOS and U-Verse where there are a lot of introductory offers and offers out there that – and I think they had about 300 – close to 303,000 net additions in the second quarter. So, they have taken those some from us and some customers from others. Obviously, in the high definition front, we haven't been as competitive as we would like in the second-quarter, particularly versus DirecTV.
And finally, operational efficiencies really in two ways, one is just our total overall customer service. In terms of are we giving customers a great experience and are we doing everything right? So, customers don't have to call us and we certainly have – we certainly made some progress there."
Ergen On Which TV Provider Is the HD Leader:
"Starting as of August 1st, we were at 114 HD national channels, I believe. DIRECTV talked about being at 100 channels last year. I think the latest thing I saw, they were at 95 channels in August 1st, so they talked about last year having 100 channels. They didn't meet that goal. We were actually the first company to have today I believe 114 national HD channels, including one that's in 1080p for video on demand, so that's true video on demand. So, we've made progress there although that's in the third quarter, obviously, not in the second quarter."
Ergen On Whether Dish Can Expand HD Capacity:
"We have a satellite being launched by a Canadian company in the fourth quarter of this year that we have leased all the capacity on. That should be operational by the first of next year. We then have Echo14 launching, I think, the end of next year. Then we have Echo15 in 2010. I think it's reasonable to expect that we would launch something in the neighborhood of one satellite per year, end up with 10 satellites in our fleet that are operational. And they – while they have 12 to 15 year lifetime, I think we're on a kind of a path of one a year to add capacity."
Ergen on Whether Dish Will Add More HD In 2008:
"I think as soon as the next satellite gets turned on, we have a chance to be more aggressive than we are today. We're a little bit more aggressive today, obviously, and we're doing a couple of different things. The first big thing we do, we have the only 8-All HD package. So, if you're going to buy an HDTV set and you don't want to put anything on it that is not HD, we're the only guys that have the system for you to do that, right, and it starts with less than $1 a day. So, that's pretty aggressive. But, its aggressive in a way that it's – from a pricing point of view, it's pretty aggressive from a packaging – program and packaging point of view as well. If you go to a cable company, before you can get it – you'd probably be buying $50 of products before you get your first HD channel. It's a kind of add-on tier. So, it's competitive in that market."
Ergen On 1080p PPV HD Movies
(Dish last Friday began showing PPV HD movies in what it calls 1080p high-def video -- the same resolution as Blu-ray.)
"But, we have 10 or 15 channels probably in 1080p that we'll put up... Realize that we're starting with pay per view movies, our video on demand. So, the way that works is we don't actually need – we don't need a lot of capacity for that because we actually download that in the middle of the night, that capacity to your hard drive, so it doesn't take up a full linear channel while we do that and then the video on demand movies is there, so, I Am Legend, or whatever, the first movie that we started with, that just got downloaded to everybody in the middle of the night. It takes us a couple of hours to download it and then it was done. No more capacity was needed for that movie in 1080p. So, there's not any question, and I think you probably hear the same thing from DIRECTV but the satellite industry is going to be over delivered the best quality of HD and the satellite industry going to be able deliver the most channels.
Ergen on Dish's DVR Patent Case vs. TiVo
(TiVo won its patent case in a Texas court, but there will be a September 4 hearing to assess the status ot the case.)
"At some point, I believe we'll prevail. But TiVo, we're going to have conversations with TiVo one way or the other about how we work together. And again, it's, I'm just stubborn. I know this case inside and out, I've sat through trials, I've sat through the engineering models, I've sat and have the best and the brightest explain this – and I'm just stubborn. We don't violate their intellectual property today and I want to prove that. And so, we're going to go to the September 4th hearing and see who's right.
