Dish 4Q16 Earnings Call Notes

Charlie Ergen

OTT trends haven’t accelerated although they may at some point

“Yeah. And this is Charlie. Just in a bigger picture response to your question, I mean, I think the linear television, traditional trends, I think, still continue to be down. I don’t think that that is going to change in the future. And the OTT trends are up. And I think those are just general trends that have been going on for two or three years. And I think the question will be just whether they – they really haven’t accelerated in a material way, but at some point perhaps they will, particularly as more people come into the OTT market.”

Explanation of why they spun off Echostar 10 years ago

“It was almost 10 years ago when we split the companies apart. We had a logic to why we’re doing it. We had a theory on where we thought the market was going to go. Some of those theories didn’t turn out to be exactly right. For example, we thought that the set-top box business, from an EchoStar perspective, we could go out and get – as a separate company, we could go out and get other people in the industry, cable industry and other parts of the world. And we just really weren’t that successful.”

We can potentially build a new network at a lower cost

“There’s going to be a really a fundamental shift in wireless technology with 5G, and you’re reading a lot about it. Because it brings lower latency, a lot faster throughput, enables Internet of Things, in particular narrowband Internet of Things for massive Internet connectivity. So we see that it makes logical sense for us to build a network not like the current incumbents have but with utilizing the new technology. So in other words, we can build a network that’s completely an IP network, take advantage of all the 5G technologies and also take advantage of the virtualization of the core, for example, so that, well, the smarts are in the cloud instead of being on the tower. So there’s a lot of – which means you’re building – as a matter of fact, as your build-out cost is a lot less and your OpEx is a lot less, and you have a modern network that has much more capacity than networks do today.”

It’s smoother to spend time planning things

“My experience has been that those things go a lot smoother when you spend a fair amount of your time planning and not just doing things and then changing things. So I think we spend a lot of time planning, and we feel like we’re in pretty good shape to go out and have a network that can take advantage of it. ”

Viacom is wise to consolidate channels

“This is Charlie. I think it’s smart. I think that’s a reasonable strategy. I think that there are probably too many channels out there today and there are channels that we know are lightly viewed that consumers have to pay for. And with the advent of competition from Netflix and Amazon and Apple and other people who are now in the programming business, I think that it’s – I think what Viacom is doing is wise. I don’t think – I think there’s still value in some of their other channels, and I don’t think they’re giving up on those channels. I just think they just – I think just think they’re going where the eyeballs are going, and I think that’s a reasonable strategy, and I think we’ll probably see other content providers focus on fewer channels but make them better.”

Roger Lynch

More competition is good in a new market

“DIRECTV NOW launched at the end of November. And my take on what we saw is an expansion of the OTT market by their entry. So we didn’t see through the quarter any change in the momentum that we had on Sling TV including in the month of December after they launched. We know that they added a lot of subscribers in that month. So our hope, we’ve been expecting more competition for quite a while for Sling TV, and our expectation has been that as new entrants enter the market, the market just expands faster, which is typically what you see in early-stage markets like this.”