EchoStar finds it difficult to expand set-top sales beyond Dish

EchoStar (Nasdaq: SATS) says that it hasn't had much success expanding sales of set-top boxes beyond its former corporate sibling Dish Network (Nasdaq: DISH).

Charlie Ergen


"Our current customer concentration is likely to continue for the foreseeable future," EchoStar, which is controlled by Dish chairman Charlie Ergen, disclosed in a 10-Q filing at the SEC.

Ergen, who split Dish from EchoStar in 2008, had been attempting to sell U.S. and international pay TV distributors set-tops similar to those that EchoStar manufacturers for Dish, including high-definition set-tops and its Slingbox place-shifting receivers. But last month, EchoStar said that it would stop pitching U.S. cable operators its set-tops, and focus on international providers. EchoStar bought an exhibit at The Cable Show convention last year, but won't exhibit at this year's convention, which will be held in Boston later this month.

Most of the digital set-tops EchoStar manufactures are sold to Dish, Dish Mexico and Bell TV in Canada. "While we expect to sell equipment to other customers, the number of potential new customers for our EchoStar Technologies segment is small and may be limited by our common ownership and related management with Dish Network," EchoStar said in the SEC filing.

EchoStar said it generated $237.3 million in equipment revenue from Dish in the first quarter, down about $35 million compared to this time last year. Total revenue increased 59 percent to $765 million, and it generated $127 million ($1.45 per share) in net income, compared to $17 million (19 cents per share) during the first quarter of 2011.

For more:
- see the earnings release

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