Thursday, November 20, 2008

Cracks at Dish Network will take time to repair

NEW YORK (Hollywood Reporter) – In an economic downturn, shoppers tend to flock to big discounters like Wal-Mart. And for a long time, Dish Network has positioned itself as the Wal-Mart of satellite TV operators, with product appealing to the cost-conscious consumer who still wants options.

So, shouldn't things be fine and dandy for Charlie Ergen's company?

Well, perhaps in theory. Yet Dish just reported back-to-back quarters of subscriber declines, the first such drops since the launch of the U.S. satellite TV industry.

It turns out that Dish's lower-end customer base feels economic pressure faster and churns off. It's also hard to win over users from other service providers. That and some bad news in a long-running legal showdown with DVR pioneer TiVo has decimated Dish shares over the past six months, and the company hit a new 52-week low of $10.21 intra-day on Tuesday.

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