EchoStar Courting New Customers for Hopper Receiver/DVR

Dish took the wraps off Hopper earlier this year, packaging three satellite tuners and a 2 terabyte hard drive into a Multimedia over Coax Alliance (MoCA)-equipped device that also features SlingMedia software and a 750 MHz Broadcom processor. Despite the delivery of new Hopper receivers, EchoStar’s Q1 sales to Dish dropped to $364 million from $393.3 million due partly to Dish’s strategy of using the MoCA-equipped set-top to connect to client receivers that carry a lower cost, company officials said. EchoStar’s Q1 Dish-related technologies segment posted a decline in revenue to $300.1 million from $336 million.

EchoStar is weighing “several” potential customers for Hopper, including the Dish Mexico joint venture that Dish runs with MDC Communications, company officials said. Dish Mexico has “north” of 2 million customers, and Dish and MDC are seeking to upgrade customers to HD and DVRs, EchoStar President Mark Jackson said.

Dish Mexico was scheduled to shift transmissions in 2011 to a Space Systems Loral-built QuetzSat-1 Ka-band satellite at 77 degrees west, but EchoStar has delayed the transition as it sifts through 3-4 alternatives, Carroll said. Under the original pact, Dish Mexico was to get 24 of 32 Ka-band transponders under a service agreement with SES Latin America. QuetzSat went into orbit at 67.1 degrees west in December. It has been receiving programming from EchoStar-8 and EchoStar-1, both at 77 degrees west. EchoStar provided Dish Mexico $2 million and $1 million in uplink and engineering services in Q1, respectively, up from $2 million in engineering. It also sold Dish Mexico $14 million in set-tops in Q1, up from $9 million a year earlier. The reason for the QuetzSat delay is partly rooted in Brazil’s communications regulator Anatel selecting EchoStar’s $80 million bid for a 45 degrees west orbital slot that could be used to expand video and data services in South America, EchoStar officials said. The timing for starting service from the 45 degrees west slot hasn’t been set and EchoStar is weighing forging a partnership or going it alone, Carroll said.

Meanwhile, Space Systems/Loral-built Ka-band Jupiter-1, which was renamed EchoStar-17, is expected to launch in late June aboard an Ariane-5 rocket with a higher-speed HughesNet broadband service to follow by late August. EchoStar acquired the satellite, which will be at 103 degrees west, in buying Hughes Communications last year. The satellite is designed to deliver up to 25 Mbps downloads, though average transmission speeds, pricing and packaging haven’t been set. The download speed for the basic package could start at 3-5 Mbps, company officials have said. EchoStar has $120 million remaining to be paid for Jupiter-1, including the launch contract and insurance, company officials said. Jupiter-1 is covered by $330 million in insurance, which includes the satellite and launch, Hughes Communications President Pradman Kaul said. EchoStar also is planning a second half launch for EchoStar-16, a Ku-band satellite aboard a Proton M rocket to be positioned at 61.5 degrees west from Kazakhstan. Dish is leasing 32 transponders on EchoStar-16. EchoStar had $68 million remaining to be paid of EchoStar-16 as of March 31.

A trial has been set for August in the Personalized Media Communications (PMC) lawsuit against EchoStar and Dish that accuses the companies on infringing six patents related to satellite signal processing, EchoStar said in a 10-Q SEC filing. Motorola also was named in the suit, but settled with PMC. EchoStar’s Q1 profit soared to $126.5 million from $17.1 million. Revenue jumped to $764.7 million from $479 million due partly to the acquisition of Hughes, which posted $274 million in sales, including $220 million in services. Hughes ended Q1 with 634,000 subscribers to its HughesNet satellite-based broadband service, up from 626,000 in the previous quarter. EchoStar’s Q1 sales to Bell TV in Canada rose to $66.1 million from $41.4 million a year earlier. Dish accounted for 47.6 percent of EchoStar’s Q1 revenue, down from 82 percent a year earlier, as “all other,” which includes Hughes, grew to 43.7 percent from 9.4 percent, the company said in SEC documents. All other revenue grew to $243.4 million from $20.5 million a year earlier, the company said. Hughes supplied less than $1 million in services to Dish acquisitions TerreStar and DBSD North America, the company said.