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Dish Speaks Out On DIRECTV Merger & More
By Swanni

Washington, D.C. (May 10, 2013) - Dish yesterday revealed it added 36,000 net subscribers in the first quarter, which was 15,000 more than rival DIRECTV added in the first quarter.

Still, Dish's sub numbers fell short of analyst estimates and the company continues to operate in a manner of controlled chaos, fending off network lawsuits over its ad-zapping Hopper DVR while bidding $25.5 billion for Sprint.

After releasing its first quarter report yesterday, Dish executives, including its chairman, Charlie Ergen, took questions from Wall Street analysts and reporters. Here are the highlights of the session:

Dish on lower than expected subscriber additions:
Our pay-TV base increased by 36,000 subscribers in the quarter. While this was less growth than we saw in the first quarter of 2012, it was not unexpected due to the price increase this year. Pay-TV churn in the quarter was up 12 basis points year-over-year but roughly equal to first quarter 2011, the last time we took a price increase," said Robert Olson, Dish's chief financial officer.

Dish on whether it would choose a DIRECTV merger or Sprint acquisition:
Dish CEO Joe Clayton: "Our preference is Sprint, that's our focus and that just makes the most sense for us. Because we transform -- we would transform DISH and we transform Sprint. I mean, both companies get transformed in that process. And it becomes a unique company. It's something that nobody else can do inside and outside the home. And while you're right, there'd be tremendous synergies with DIRECTV, it still would be -- while, there'll be a lot of synergy and it will be bigger, it's still the same company and you still would have to ultimately figure out how to transform that company long-term, in my opinion, because the video business has matured and ultimately, will go into decline phase."

Dish on the differences between its Hopper DVR and DIRECTV's Genie DVR:
"The comparison of Hopper and Genie is probably a lot of smoke and mirrors, at least from their standpoint because they do not have PrimeTime Anytime, they do not have AutoHop (the ad-zapping feature). They have a 1 terabit hard drive, we -- Hopper has 2 terabit hard drive so it's 2000 -- double the storage capacity. They do not have DISH Anywhere, they do not have Hopper Transfers and they do not have the Hopper second-screen app. So if you're taking account here, I would say, just by the numbers standpoint, we are far superior in terms of features and customer experience."

Ergen added:
"I think every review that's been done particularly the Hopper has gotten almost the highest rating you can get, 5 stars or 4.5 stars in every review I've seen. I've seen a dozen of them and when compared to the Genie, it's always come out ahead of the Genie. Having said that, I think DirecTV does perhaps a better job from the marketing front. Obviously, they're able to run network commercials, we're not able to do that because of networks won't run our commercials due to AutoHop so -- but I think their marketing is quite good and they've traditionally done a really good job at marketing."

Dish on the future of the Pay TV business:
Ergen: "
Quite frankly, the linear video business big packages has performed better than we thought it would. We thought the recession would kind of knock its legs up from under, it didn't really happen. The programmers primarily haven't moved to OTT. We thought they might. It appears that they're not doing that, that they're staying with a kind of authentication model as opposed to an OTT model. So it looks like the industry for the foreseeable future is going to continue down a path of -- mature path with maybe some companies willing to spend a little bit more money for acquisition than others, and maybe small shifts in the marketplace."

Dish on Sen. John McCain's legislation to impose a la carte pricing on pay TV operators:
Ergen: "
I think only Dish and Cablevision have been the two companies that have traditionally been for ala carte or smaller bundles. We haven't changed that position because we just think it's more consumer-friendly. And we know that our customers pay for 200 channels and watch 15. But having said that, there are 6 big or 5 big groups that probably have enough clout in Congress to, at least in my opinion, would be to stop that kind of legislation today. We'll see because we do have a Satellite Home Viewer Act kind of must pass legislation."

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