EchoStar Pursues a Strategy Shift

[mike123abc]

The Wall Street Journal is reporting that Echostar is changing strategy. Lauching as many as 9 satellites and spending 1.6 billion. Perhaps to resell excess capacity to others.

http://online.wsj.com/article/SB114299142403304784.html?mod=hps_us_at_glance_technology

The new direction indicates that EchoStar's chairman and chief executive, Charles Ergen, renowned for controlling costs and minimizing capital outlays, has decided to ratchet up spending in the face of mounting competition.

Yes subscription is required but I am sure it will be available elsewhere soon for free..

 

[cforrest]

EchoStar Pursues a Strategy Shift

http://online.wsj.com/article/SB114299142403304784.html

Cost-Conscious CEO Ergen
To Boost Satellite Spending,
May Lease Extra Capacity
By ANDY PASZTOR
March 22, 2006; Page B2

EchoStar Communications Corp. is pursuing a new strategy that envisions investing more than $1.6 billion to dramatically increase its satellite fleet over the next few years, with plans to potentially lease some of the extra capacity to other companies.

The Englewood, Colo., broadcaster, which is best known for operating the Dish television service in the U.S., also disclosed in a recent regulatory filing that it has switched to Loral Space & Communications Ltd. from Lockheed Martin Corp. as the mainstay of its stepped-up spacecraft-acquisition plan. An EchoStar spokeswoman declined to elaborate.

The new direction indicates that EchoStar's chairman and chief executive, Charles Ergen, renowned for controlling costs and minimizing capital outlays, has decided to ratchet up spending in the face of mounting competition. Rival cable and satellite-television services, for example, are investing in facilities to provide high-definition video programming.

At the same time, industry analysts and consultants said Mr. Ergen seems to be hedging his bet by positioning EchoStar to become a wholesale provider of orbital capacity able to compete with traditional satellite operators such as Intelsat Ltd., of Bermuda, and Luxembourg's SES Global SA.

So far, EchoStar has primarily built satellites to serve its more than 12 million subscribers, and it previously signed up to use additional capacity on other satellites operated by SES Global's U.S. unit. But with its new strategy calling for a total of at least another nine wholly owned or leased satellites supporting its expansion program into the next decade, EchoStar would have greater flexibility to move outside the company's core satellite-to-home broadcast niche.

"In addition to our [satellite-television] business plan," EchoStar said last week in an SEC filing, "we are exploring business plans" for additional satellites at as many as five orbital slots. In a conference call with investors after the document was filed, company executives hinted they are considering branching into other industry segments.

Some of the new satellites are intended as replacement and supplemental capacity "to allow EchoStar to leapfrog cable-television providers" in beaming down high-definition programs to households, according to Vijay Jayant, an analyst with Lehman Brothers. But if the appetite for such content fails to take off, Mr. Jayant said, EchoStar "has looked at the cost-benefit analysis" and decided "it also can become a satellite player" in the wholesale arena.

Jimmy Schaeffler, an industry consultant with Carmel Group, said the EchoStar filing reveals "the beginning of a major shift in strategy." Mr. Ergen has decided "he can be a middleman in wholesaling incremental capacity and still do quite well."

The 2006-09 spending plan laid out in EchoStar's filing projects roughly $500 million more in satellite-related obligations than the total included in a year-earlier filing. With an overall price tag approaching $3 billion into the next decade, the latest plan also relies on eventually buying five more-versatile satellites from Loral, instead of a pair of spacecraft previously listed as on order from Lockheed.

The most recent filing, which doesn't mention the Lockheed orders, says that, during the fourth quarter of 2005, "we changed satellite vendors and submitted the revised contracts" to U.S. regulators. It doesn't give any reason for the shift.

A spokesman for Lockheed, of Bethesda, Md., said it still has "two open satellite contracts" with EchoStar but declined to elaborate. A spokeswoman for New York-based Loral said, "We are performing in accordance with the milestones" required in the contracts but declined to provide details.

Write to Andy Pasztor at andy.pasztor@wsj.com

 

[dishcomm]

EchoStar Pursues a Strategy Shift

http://online.wsj.com/article/SB114299142403304784.html

Cost-Conscious CEO Ergen
To Boost Satellite Spending,
May Lease Extra Capacity
By ANDY PASZTOR
March 22, 2006; Page B2

EchoStar Communications Corp. is pursuing a new strategy that envisions investing more than $1.6 billion to dramatically increase its satellite fleet over the next few years, with plans to potentially lease some of the extra capacity to other companies.

The Englewood, Colo., broadcaster, which is best known for operating the Dish television service in the U.S., also disclosed in a recent regulatory filing that it has switched to Loral Space & Communications Ltd. from Lockheed Martin Corp. as the mainstay of its stepped-up spacecraft-acquisition plan. An EchoStar spokeswoman declined to elaborate.

The new direction indicates that EchoStar's chairman and chief executive, Charles Ergen, renowned for controlling costs and minimizing capital outlays, has decided to ratchet up spending in the face of mounting competition. Rival cable and satellite-television services, for example, are investing in facilities to provide high-definition video programming.

At the same time, industry analysts and consultants said Mr. Ergen seems to be hedging his bet by positioning EchoStar to become a wholesale provider of orbital capacity able to compete with traditional satellite operators such as Intelsat Ltd., of Bermuda, and Luxembourg's SES Global SA.

So far, EchoStar has primarily built satellites to serve its more than 12 million subscribers, and it previously signed up to use additional capacity on other satellites operated by SES Global's U.S. unit. But with its new strategy calling for a total of at least another nine wholly owned or leased satellites supporting its expansion program into the next decade, EchoStar would have greater flexibility to move outside the company's core satellite-to-home broadcast niche.

"In addition to our [satellite-television] business plan," EchoStar said last week in an SEC filing, "we are exploring business plans" for additional satellites at as many as five orbital slots. In a conference call with investors after the document was filed, company executives hinted they are considering branching into other industry segments.

Some of the new satellites are intended as replacement and supplemental capacity "to allow EchoStar to leapfrog cable-television providers" in beaming down high-definition programs to households, according to Vijay Jayant, an analyst with Lehman Brothers. But if the appetite for such content fails to take off, Mr. Jayant said, EchoStar "has looked at the cost-benefit analysis" and decided "it also can become a satellite player" in the wholesale arena.

Jimmy Schaeffler, an industry consultant with Carmel Group, said the EchoStar filing reveals "the beginning of a major shift in strategy." Mr. Ergen has decided "he can be a middleman in wholesaling incremental capacity and still do quite well."

The 2006-09 spending plan laid out in EchoStar's filing projects roughly $500 million more in satellite-related obligations than the total included in a year-earlier filing. With an overall price tag approaching $3 billion into the next decade, the latest plan also relies on eventually buying five more-versatile satellites from Loral, instead of a pair of spacecraft previously listed as on order from Lockheed.

The most recent filing, which doesn't mention the Lockheed orders, says that, during the fourth quarter of 2005, "we changed satellite vendors and submitted the revised contracts" to U.S. regulators. It doesn't give any reason for the shift.

A spokesman for Lockheed, of Bethesda, Md., said it still has "two open satellite contracts" with EchoStar but declined to elaborate. A spokeswoman for New York-based Loral said, "We are performing in accordance with the milestones" required in the contracts but declined to provide details.

Write to Andy Pasztor at andy.pasztor@wsj.com

I hope Charlie doesn't think I'm eating the cost

 

[riffjim4069]

Telephone, wireless, and broadband costs are down more than 30% since the year 2000. During this same time video prices are up more than 30%. What gives? I fully expect to see cable and satellite prices come crashing back down to reality in the coming months now that the Telcos are rolling out video service. Charlie had better find another source of revenue because one way or another I am going to be paying much less for my video service next year.

 

[abricko]

Lets hope this will allow them to add more HD content, and increase overall channel quality (until they sell too much of their excess capacity and begin the squeeze again)

 

[Chris Freeland]

This may be what E* has in store for 105 once those locals are moved to 110. E* still has a few years left on the 105 lease, E* could very easily sub-lease the space to others. This could be the beginning of E* entering the wholesale market.

 

[kfried001]

EchoStar Pursues a Strategy Shift

http://online.wsj.com/article/SB114299142403304784.html

Cost-Conscious CEO Ergen
To Boost Satellite Spending,
May Lease Extra Capacity
By ANDY PASZTOR
March 22, 2006; Page B2

EchoStar Communications Corp. is pursuing a new strategy that envisions investing more than $1.6 billion to dramatically increase its satellite fleet over the next few years, with plans to potentially lease some of the extra capacity to other companies.

The Englewood, Colo., broadcaster, which is best known for operating the Dish television service in the U.S., also disclosed in a recent regulatory filing that it has switched to Loral Space & Communications Ltd. from Lockheed Martin Corp. as the mainstay of its stepped-up spacecraft-acquisition plan. An EchoStar spokeswoman declined to elaborate.

The new direction indicates that EchoStar's chairman and chief executive, Charles Ergen, renowned for controlling costs and minimizing capital outlays, has decided to ratchet up spending in the face of mounting competition. Rival cable and satellite-television services, for example, are investing in facilities to provide high-definition video programming.

At the same time, industry analysts and consultants said Mr. Ergen seems to be hedging his bet by positioning EchoStar to become a wholesale provider of orbital capacity able to compete with traditional satellite operators such as Intelsat Ltd., of Bermuda, and Luxembourg's SES Global SA.

So far, EchoStar has primarily built satellites to serve its more than 12 million subscribers, and it previously signed up to use additional capacity on other satellites operated by SES Global's U.S. unit. But with its new strategy calling for a total of at least another nine wholly owned or leased satellites supporting its expansion program into the next decade, EchoStar would have greater flexibility to move outside the company's core satellite-to-home broadcast niche.

"In addition to our [satellite-television] business plan," EchoStar said last week in an SEC filing, "we are exploring business plans" for additional satellites at as many as five orbital slots. In a conference call with investors after the document was filed, company executives hinted they are considering branching into other industry segments.

Some of the new satellites are intended as replacement and supplemental capacity "to allow EchoStar to leapfrog cable-television providers" in beaming down high-definition programs to households, according to Vijay Jayant, an analyst with Lehman Brothers. But if the appetite for such content fails to take off, Mr. Jayant said, EchoStar "has looked at the cost-benefit analysis" and decided "it also can become a satellite player" in the wholesale arena.

Jimmy Schaeffler, an industry consultant with Carmel Group, said the EchoStar filing reveals "the beginning of a major shift in strategy." Mr. Ergen has decided "he can be a middleman in wholesaling incremental capacity and still do quite well."

The 2006-09 spending plan laid out in EchoStar's filing projects roughly $500 million more in satellite-related obligations than the total included in a year-earlier filing. With an overall price tag approaching $3 billion into the next decade, the latest plan also relies on eventually buying five more-versatile satellites from Loral, instead of a pair of spacecraft previously listed as on order from Lockheed.

The most recent filing, which doesn't mention the Lockheed orders, says that, during the fourth quarter of 2005, "we changed satellite vendors and submitted the revised contracts" to U.S. regulators. It doesn't give any reason for the shift.

A spokesman for Lockheed, of Bethesda, Md., said it still has "two open satellite contracts" with EchoStar but declined to elaborate. A spokeswoman for New York-based Loral said, "We are performing in accordance with the milestones" required in the contracts but declined to provide details.

Write to Andy Pasztor at andy.pasztor@wsj.com

I wonder if Dish is picking up the Lockhead Martin contracts that VOOM had in place to launch multiple satellites?

 

[StevenD]

Telephone, wireless, and broadband costs are down more than 30% since the year 2000. During this same time video prices are up more than 30%. What gives? I fully expect to see cable and satellite prices come crashing back down to reality in the coming months now that the Telcos are rolling out video service. Charlie had better find another source of revenue because one way or another I am going to be paying much less for my video service next year.

Telephone, wireless and broadband arent selling content. Content costs money.

 

[Juan]

Telephone, wireless, and broadband costs are down more than 30% since the year 2000. During this same time video prices are up more than 30%. What gives? I fully expect to see cable and satellite prices come crashing back down to reality in the coming months now that the Telcos are rolling out video service. Charlie had better find another source of revenue because one way or another I am going to be paying much less for my video service next year.

doubt it...look who owns the "content" c-o-m-c-a-s-t and other greedy companies t-i-m-e-w-a-r-n-e-r- , RAINBOW (c-a-b-l-e-v-i-s-i-o-n) and DISNEY!!!

 

[riffjim4069]

Telephone, wireless and broadband arent selling content. Content costs money.

Exactly! I'm paying for overpriced content I don't need and don't want...let these junk content generators find their own paying customers or suffer the fate of a free market economy. Just like American's are tired of having no cables choices, they are equally tired of having to subscribe to 200 of garbage just so they can watch the 16 channels that bring them pleasure.

Also, as much as I enjoy sports...stop making the subscribers subsidize ESPN and other sports networks. The subscriber costs for these sports network is getting out-of-control. But this is a topic for heated discussion elsewhere.

~riffjim4069 says "Al a carte is Al a smart"

 

[GaryPen]

I wonder if Dish is picking up the Lockhead Martin contracts that VOOM had in place to launch multiple satellites?

It says right in the article that Dish is switching to Loral from Lockheed.