Let's assume the # of Dish HD customers is between 300,000 and 1,000,000. Let's say they also will replace all of the HD receivers over 12 months. Probably less than half the HD receivers are DVRs. Certainly less than half the current Dish customers have any clue about this move to MPEG-4, and they'll be late converters. And since this is all just a SWAG, we'll assume the households with more than 1 HD DVR is offset by the actual number of HD DVRs being less than half the HD households.
So we're looking at 150,000 to 500,000 DVRs, tops. That's roughly 12,000 to 40,000 DVRs per month to replace, if they were to be replaced evenly over the 12 months. In fact, they'll likely have to replace most of them in the last 3 months of the conversion. And the conversion of all HD to MPEG-4 may slip from the currently expected March 2007.
Let's further estimate that Dish will move to buying 20,000 ViP622s per month as soon as possible. And they may need to more than double that in a year. I wouldn't be surprised if over the next 12 to 18 months, the number of Dish HD households doubled. We're talking over a $100 Million investment in HD DVRs over the next year, and it could be double or triple that, considering all HD STBs and HD subscriber growth. And that's just the STB costs. Throw in the Dish1000 costs and truck rolls, and we'll vaguely double that to a $200M minimum investment
Echostar's market capitalization is almost 13 Billion dollars, per CNN/Money today. We're talking about, very roughly, 1% - 2% of their market cap going into this in a year. Based on the first 3 quarters of 2005, let's SWAG a net income to DISH of $1.5 Billion. Also considering their increased cash flow due to the "generosity" of their HD subscribers under the new plans, I'd say they could easily cover this conversion, and come out of it with higher monthly income and an improved cash flow.
Based on the estimated average replacements discussed above, and the "bow wave" of early adopters, and the delay in orders due to those waiting until the 4/1/07 rebate offer kicks in, I'd SWAG an up front backlog of 10,000 - 20,000. Something they are likely to take care of before 4/1/07. So this gives me hope that my retailer/installer will get a few in during the next few weeks and provide me with the opportunity to shove more money Charlie's way. I've been holding off getting Dish HD for this MPEG-4 DVR, so I'm ready and don't mind the extra monthly cost. If I bought a 921/942 in the past few months, I'd feel differently.
All of this is a SWAG of the highest order. Never mind hitting the barn, I'd be happy if I hit the right farm in the right county with these estimates. But it all leads me to believe that there will be normal deliveries of ViP622s by summer, and the installer delays may be more of an issue than equipment availability. It also leads me to believe, assuming no big problems with the ViP622 are found, that there may be some very enticing deals after Christmas to get people to move over. How long do you want to wait?
So we're looking at 150,000 to 500,000 DVRs, tops. That's roughly 12,000 to 40,000 DVRs per month to replace, if they were to be replaced evenly over the 12 months. In fact, they'll likely have to replace most of them in the last 3 months of the conversion. And the conversion of all HD to MPEG-4 may slip from the currently expected March 2007.
Let's further estimate that Dish will move to buying 20,000 ViP622s per month as soon as possible. And they may need to more than double that in a year. I wouldn't be surprised if over the next 12 to 18 months, the number of Dish HD households doubled. We're talking over a $100 Million investment in HD DVRs over the next year, and it could be double or triple that, considering all HD STBs and HD subscriber growth. And that's just the STB costs. Throw in the Dish1000 costs and truck rolls, and we'll vaguely double that to a $200M minimum investment
Echostar's market capitalization is almost 13 Billion dollars, per CNN/Money today. We're talking about, very roughly, 1% - 2% of their market cap going into this in a year. Based on the first 3 quarters of 2005, let's SWAG a net income to DISH of $1.5 Billion. Also considering their increased cash flow due to the "generosity" of their HD subscribers under the new plans, I'd say they could easily cover this conversion, and come out of it with higher monthly income and an improved cash flow.
Based on the estimated average replacements discussed above, and the "bow wave" of early adopters, and the delay in orders due to those waiting until the 4/1/07 rebate offer kicks in, I'd SWAG an up front backlog of 10,000 - 20,000. Something they are likely to take care of before 4/1/07. So this gives me hope that my retailer/installer will get a few in during the next few weeks and provide me with the opportunity to shove more money Charlie's way. I've been holding off getting Dish HD for this MPEG-4 DVR, so I'm ready and don't mind the extra monthly cost. If I bought a 921/942 in the past few months, I'd feel differently.
All of this is a SWAG of the highest order. Never mind hitting the barn, I'd be happy if I hit the right farm in the right county with these estimates. But it all leads me to believe that there will be normal deliveries of ViP622s by summer, and the installer delays may be more of an issue than equipment availability. It also leads me to believe, assuming no big problems with the ViP622 are found, that there may be some very enticing deals after Christmas to get people to move over. How long do you want to wait?
