Dish 3Q15 Earnings Call Notes

Cord cutting trends last quarter weren’t quite as bad as people thought, this quarter more representative of continued pressure

“those trends – the last quarter wasn’t as bad as everybody thought it was. It’s just those trends have been building for the last three years, and everybody kind of caught up at one time. This quarter, it’s probably more representative of still continued pressure on the linear model.””

We have unprofitable customers who just call us too much

“Having said that, one of the other things that we’re looking at is that we do have customers that are unprofitable for us today, and they’re unprofitable because they call multiple times during the month, they are always asking for discounts. Even if you gave them the discount they asked for, they’d be an unprofitable customer. And I think it’s just smart business that over time that we wean those customers off of our service.”

Content providers need to think about maximizing long term value

“I would say that the biggest thing I think that the content providers should be looking at is long-term. So it’s easy to get to the end of the year, end of the quarter, and sell some content out of the back door and don’t think it’s going to hurt your core business in the short run, and you’ve got kind a one quarter gain or you make your bonus – you guys all make your bonus. There’s always in a company a risk of short-term decisions. The way I look at it more fundamentally is where can the – content is always going to be a valuable commodity, and where can you take content to maximize your long-term value?”

Sprint partnership didn’t work 2.5 years ago because they went a different direction with network

“that with Sprint we had a materially different strategy on how to build our network out. I mean, our strategy really was to use our spectrum on their towers, because it’d fit on the towers from a propagation point of view. They ultimately – they obviously pursued a strategy of 2.5 GHz, which doesn’t propagate exactly the same, and some new technology that they decided to use. So they went in a different direction. So I think a lot of that synergy is probably the long-term still there but certainly not in the short-term kind of framework. But I don’t know exactly where Sprint is on their network build today and how much they have gone down a path that’s kind of hard to put the genie back in the bottle. But we had a materially different strategy in how we would integrate Sprint and our spectrum together.”

With deals people sit around and talk about them and then when somebody decides they move quick

“I would say the odds are greater that we wouldn’t do something before the deadline than we would. But you just never know, right? My experience with deals are that people can sit around and talk about them, they’re just not going to happen, but when somebody decides to do something, they move pretty quick. But there are – I agree with your statement, there are a lot of complexities around this auction that are going to take some time.”

The strategic decisions you make better have a good chance of success

“we’re six years into our wireless strategy. I think we’re six years into it. Whether we go another year or two years or three years before we go in a particular direction, I don’t think is that material to us. I know that there’s always a lot of angst on the press and investors for things to happen, but we look at it to make – we don’t make a lot of decisions, but the ones that you do make on the strategic side need to be – better have a good chance of success.’

The cable industry is potentially poised to be a serious competitor in wireless

“I think the cable industry is potentially poised to be a serious competitor in the wireless industry. And they certainly have the ability to certainly put their toe in the water and just do an MVNO deal. And they have had – the cable industry has had stumbles in the past in the wireless industry. In fact they’ve sold out of it, right?

So whether you jump back in again with both feet or maybe look at the MVNO deal and see how it goes remains, they have a lot of options as to what they may or may not do. To the extent that they got in the industry, obviously it would put pressure on the incumbents, and certainly put spectrum pressure on the incumbent.”

Viewing minutes already majority mobile in China

“In China already, the vast majority of viewing minutes are on mobile devices for video. So if you’re a content company, you just can’t – again, it would be malpractice to put your head in the sand and not think about how you’re going to get on mobile devices.”

AT&T is probably the closest to connecting linear and mobile

“we have – the way I’d say it is we have some of the building blocks of that in terms of we have technology, we have spectrum, and we have video customers and we have an in-home installation network. We have encryption. We have billing, we have customer service, so we have a lot of the building blocks, but we don’t have all the building blocks. We don’t have things like backhaul and Wi-Fi and things that the cable industry has. And no one company today has all the building blocks. So AT&T is probably closer today than they were before the DIRECTV acquisition.”