E* outdoes D* in last Quarter

[Tom Bombadil]

http://www.msnbc.msn.com/id/17419422/

Note that E* picked up 350,000 new subs in the 2006 Q4 vs D*'s 275,000.

This despite the loss of the distant nets, the TIVO lawsuits, and all of the associated stories that ran which seemingly showed E* in disarray.

With all of the grumbling about the distant nets, and conjecture here about how much that would hurt E*, I find it amazing that they actually went out and had a very successful quarter. There is nothing in these numbers to indicate that the distant nets problem hurt them very much.

Total net revenue is up 17% from a year ago, to 2.58 Billion in the quarter.

[snook2448]

EchoStar's Net Rises 15% On Subscriber Growth

EchoStar Communications Inc., the country's No. 2 satellite TV provider, posted a 15% rise in fourth-quarter net income, driven by better-than-expected subscriber growth and a 17% revenue increase.

The Englewood, Colo. company added about 350,000 net new subscribers during the December quarter, more than many analysts expected. EchoStar ended the year with 13.11 million subscribers, up 1.07 million subscribers from 2005.

Like its rival, DirecTV Group Inc., EchoStar has deliberately tightened credit policies for more than a year. This has helped improve profitability but slowed subscriber growth. Subscriber growth appeared weak through most of 2006 because of the credit policies. Subscriber growth was also expected to be slowed a bit in the quarter because the company lost a court battle over its carriage of "distant signals" that forced it to pull ABC, CBS, NBC and Fox stations in an estimated 800,000 to 900,000 customers throughout the country.

Despite the issues during the quarter, EchoStar ended up adding more subscribers than rival DirecTV, which added 275,000 net new subscribers during the quarter.

The fourth quarter "marked the fourth time in the past five quarters that EchoStar outperformed DirecTV in net additions," Cowen analyst Tom Watts wrote in a note. Mr. Watts had anticipated 270,000 net additions during the quarter.

EchoStar earned $153 million, or 35 cents a share, in the fourth quarter, up from $133 million, or 30 cents a share, a year earlier. Revenue rose 17% to $2.58 billion from $2.2 billion a year ago.

Fourth-quarter results "paint a picture of a company that is rolling along nicely, thank you very much," Craig Moffett, analyst at Sanford Bernstein, wrote in a note.

Despite the better-than-expected subscriber figures, Mr. Moffett noted that some concerns lurk in the numbers. Profit margins were weak with gross margins at the lowest level since 2004. Also, subscriber acquisition costs, at $704 per subscriber, were higher than expected, he said.

Satellite companies have faced pressure from cable companies in the past year as customers are lured away by cable providers' popular "triple play" bundle of TV, Internet and phone services. This has been a challenge because satellite companies aren't able to offer competing bundles without the help of a partner.

EchoStar is also embroiled in numerous legal battles. Among them, the company's patent case with TiVo Inc. doesn't seem to be letting up any time soon after a federal appeals court decided in October to let EchoStar continue offering its digital video recorder service while it appeals an earlier jury ruling that it had infringed on TiVo's patent.

[BobMurdoch]

Wow. Talk about doing well in a headwind.....

I can't figure this one out.... What are they saying accounts for all this? HD DVR?

[jahlight]

Well D* just offered me a free HD DVR so I signed up and cancelled my E* account. I have been with E* for 2 years but D* has my locals in HD, more HD sports, Sunday Ticket and now maybe the MLB EI, I just had to switch. The free HD DVR offer sealed the deal for me. Not to mention I will be saving a good $30 a month on programming costs. By E* it's been fun!

[Geronimo]

That quarter wasa holiday season. taht si one factor. Remember that D8 was reporting somewhat lowere growth because they have become more selective.

Still kudos to echostar on the sub growth.

[bgsmallwood]

That is why I switched from D* to E*

HD is catching on and E* has much more HD content. Heck, when I left D* a few months ago they were actually turning one HD channel off every Sunday so they could carry all of the NFL-ST games in HD. How amateurish is that?

[navychop]

Who was it that said "There's no such thing as bad publicity?"

[BobMurdoch]

Paris Hilton or Antonella Barba probably....

[Cyclone]

Well, When I put that "PM me for a Dish Club Card Number" last fall, I had no shortage of takers.

[riffjim4069]

[url]Note that E* picked up 350,000 new subs in the 2006 Q4 vs D*'s 275,000.

They can thank 20+ years of cable customers being treated treated like human doormats. And E* can thank their DishHD loops running around-the-clock in places like Costco and other retailers...30+ HD channels just sells itself to those looking for the most HD for the money.

In my case, I did the opposite - I left E* for Cable. Except for HD-Lite we enjoyed our E* service. However, when FiOS came to town in October the local Adelphia/Comcast offered a 12 month new customer special: a lot less HD, DVR is just ok; but HD PQ is excellent, cable service has improved over the past few years, On Demand is very good, digital cable (to include the premiums) and three HD DVRs is roughly half the price of DishHD Platinum.

We're going back to E* after our promotion offer expires....however, if FiOS comes to town then E*/D* had better be prepared to match them in terms of cost, HD quality, and HD quantity. Of course, if the local cable company were to extend their $29.95 offer another year or two...