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Clayton Explains His Decision To Join Dish

10/05/2011 10:01:12 AM Eastern

Lake Maggiore, Italy -
Joe Clayton, president/CEO of Dish Network, outlined plans for his company
during a one-on-one interview with Gary Shapiro, president/CEO of the Consumer
Electronics Association (CEA), at the organization's 15th annual CEO Summit,
here.

Gary Shapiro and Joe ClaytonClayton, the legendary
RCA sales and marketing executive, former chairman of Sirius, former chairman
of CEA and CE Hall of Famer, shared with attendees his decision to join Dish
Network full time last May and replace founder Charlie Ergen as CEO, as Ergen
retained the chairmanship.

Clayton explained he had
been on the board of Dish's parent company EchoStar for two years and knew
Ergen for 20 years. Clayton had been approached by Ergen a couple of times to
be a full-time executive with Dish, but he finally relented when Ergen had his
wife Candy approach him at a board meeting earlier this year and said, "We
need your help."

Shapiro reminded the
audience that Clayton was always a technology innovator. He was an early advocate
that digital TV had to be FullHD and  when Clayton helped put DirecTV, now his key
competitor, on the map in the mid-1990s, "We signed a 1 million units or
one-year exclusive [for the RCA brand under Thomson], and we sold the 1 million
in 10 months at $800 each. And Charlie Ergen was a DirecTV distributor at the
time."

Clayton explained he
took the job right after Ergen improved EchoStar's capabilities by buying the
Hughes Network, gaining spectrum and buying Blockbuster.

"We have always been a
technology innovator, first with the DVR. We bought Slingbox, and we didn't
have as many places as we wanted to demonstrate our technologies," so
Blockbuster fit the bill," Clayton said.

He explained, "We don't
have as many retail floors to demonstrate our technology as in the past. Now we
have 1,500 of them."

Dish is using those
stores to go after the Latino market. Customers can go there to pay bills, and
may have additional partners to get into the wireless business.

When asked by Shapiro
about Ergen, whom Shapiro said had a "brilliant ... yet frugal reputation"
- he is famous for having his executives sharing rooms on the road - Clayton
cracked, "I told him that I wouldn't share a room with him. I told him I
would be who I am. I am a jacket and tie guy, and I wouldn't donate money to
Democrats."

He added, "I am
here to change the wireless business. I flunked retirement [he retired after
being chairman of SiriusXM], but I have changed businesses [and introduced
technologies] over the years like VCR, satellite TV and radio, and HDTV."

When asked what his
goals for Dish Network are for the next five years, Clayton explained, "I
hope we are a growing [multibillion dollar] company. With the pay-TV market
saturated, I want to develop the Latino market, convert the commercial market
from analog to digital, broaden Blockbuster with partners, and with what I call
the 'Ergen Wireless Company' become a top three or four player in broadband and
wireless ... behind AT&T and Verizon."

Shapiro asked Clayton
how the pending AT&T merger - whether it is successful or not - affects Dish's
wireless and broadband plans. The Dish CEO quipped, "Part of our wireless play
will be to have a telco partner - Sprint, Lightspeed, Metro PCS, Leap, Quest ...
I hope I'm not forgetting anyone and mentioned all of them. We need a
telecommunications partner."

Clayton mentioned Dish's
Blockbuster Movie Pass, which began Oct. 1, and is available to Dish Network
customers starting at $10 per month. It features what Dish described as a pay-TV
industry first: a subscription streaming movie service bundle available on the
TV or PC." Dish claimed the package "is unmatched by any other cable,
satellite, telco or online streaming movie service."

Shapiro asked if this
was a type of "Netflix killer," and Clayton noted, "Blockbuster will offer
streaming real soon ... and add more service providers. The whole world is
changing, and it is coming out of the Cloud."

Commenting on Netflix,
he said, "It is a great company ... a force to be reckoned with." But he said the
decision by Netflix to separate its DVD and streaming services "was a good one,
the communication about that left a little to be desired," he said adding. the
mea culpa, the apology about raising prices and making the separation move did
put kerosene on the fire.

Clayton said Dish can
provide movie, TV and subscription movie services via satellite, streaming or
via the Cloud. "We can do all of the above - one company, one bill, one
connection," he said.

When Shapiro asked about
the future of subscription services and the theories about "cord-shaving" -
cutting back on satellite or cable TV services by consumers or "cord-nevers,"
who are young people who just watch TV via the web - Clayton said, "The
subscription [model] won't go away, it will be modified. We hope to be focused
on what consumers want and not an 'all you can eat' [subscription] approach."

Clayton concluded with a
mantra that has been his sales and marketing view since his days at RCA: "We
have to provide ease of use, choice, variety and value."

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