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EchoStar's DTV Converter Gets $39.99 Price Tag

1/28/2007 02:00:00 AM Eastern

EchoStar revealed it will take advantage of its recent decision to split the company into two separate units — Dish Network Corp. and EchoStar Holding Corp. — to begin offering new set-top digital-to-analog converter boxes for the upcoming digital TV transition.

This will include a converter box that will be effectively free when purchased with a $40 government coupon, EchoStar said during International CES earlier this month.

The satellite TV provider also said its Dish Network plans to expand its HDTV offerings to more than 100 national channels in 2008, and said last week that it will offer a new programming package that will only include HD channels.

The EchoStar Holding unit will manufacture and sell two set-top digital-to- analog converters that consumers can use to receive digital TV signals for display on their older analog sets.

Model TR-40, which will carry a $39.95 suggested retail, is expected to be eligible for the National Telecommunications and Information Association (NTIA) converter-box coupon program, which will make up to two $40 coupons available to households that qualify.

"That means every home in America, for two TV sets absolutely free of charge, can convert to the digital transition," said Charlie Ergen, EchoStar chairman. "There is no reason the digital transition can't take place by February 2009, and there is no reason it will cost the consumer a dime."

The second set-top, model TR-50, will include a digital video recorder and will support Dish Network's IPTV interactive service. That model will not be eligible for the government coupon.

Ergen said the $39.95 converter will be sold below the company's cost, as the company seeks to "take a leadership position," in assisting the governments DTV transition. He said EchoStar hopes that when those purchasers decide to add a multichannel service provider they will be more inclined to consider Dish Network.

Ergen said there are 13 million to 15 million U.S. homes whose TV sets will require converters if consumers don't purchase new TVs or add cable or satellite TV service.

The box will be sold under both the EchoStar and Sling Media brands. EchoStar recently acquired controlling interest in Sling Media.

The TR-40 will include all of the basic features outlined in the NTIA guidelines, plus a seven-day electronic programming guide, program search, parental locks and VCR auto-tune timers.

EchoStar expects to have the TR-40 available in limited quantities in March.

Meanwhile, EchoStar said it plans to expand its HDTV channel offerings from 76 to 100 national channels and to 100 local HD channels in 2008. This will include 61 new local HD markets in the first and second quarters.

To facilitate the expansion, the company plans to launch four satellites (one per quarter) in 2008, three of which will be used for U.S. service. The company will be transitioning over to all MPEG-4 technology through the launches.

Dish Network's planned HD-only programming package will be available on Feb. 1, and is to include more than 40 national HD channels for $29.99/month subscription. This represents all of the channels currently offered in Dish Network's "DishHD Essential" and "Ultimate" packages, but will not include any standard-def basic channels or premium high-def sports or movie channels, which must be added separately.

The company will also offer optional local HD channels in markets where those services are available.

Dish Network said after CES that it was increasing rates on some tiers while freezing pricing on select DVR tiers for established customers.

The company said that it would freeze pricing on its DishDVR Advantage package until February 2009, but raised rates by an average of between 3 percent and 8 percent on other packages, including America's Top 100 and America's Top 200.

The pricing news came as DirecTV revealed it will also raise subscription fees by an average of 4 percent on its direct-to-home television services, effective Feb. 27.

Most DirecTV packages will climb by $3/month, including the DirecTV Choice ($52.99), Choice Xtra ($57.99), Plus ($62.99) and Plus HD ($72.99). Pricing on DirecTV's Premier package will rise $5, to $104.99/month.

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