Dish Network 2008 Annual Report Download - page 16

6
Leased from EchoStar
The fees for the services provided under our short-term leases for capacity on satellites owned or leased by EchoStar
are based on spot market prices for similar satellite capacity and depend upon, among other things, the orbital location
of the satellite and the frequency on which the satellite provides services. Generally, these satellite capacity agreements
will terminate upon the earlier of: (a) the end of life or replacement of the satellite; (b) the date the satellite fails; (c) the
date that the transponder on which service is being provided under the agreement fails; and (d) January 1, 2010.
Although, EchoStar has no obligation to provide us transponder leasing after expiration, we anticipate continuing to
lease capacity on these satellites from EchoStar following the initial terms of these agreements, and may enter into
subsequent lease agreements if we determine that it is beneficial for us to do so. However, if we are unable to extend
these contracts on similar terms with EchoStar, or we are unable to obtain similar contracts from third parties after the
expiration date, there could be a significant adverse effect on our business, results of operations and financial position.
Leased from Other Third Parties
x Anik F3. Anik F3, an FSS satellite, was launched and commenced commercial operation during April
2007. This Telesat Canada (“Telesat”) satellite is equipped with 32 Ku-band transponders, 24 C-band
transponders and a small Ka-band payload. We have leased all of the Ku-band capacity on Anik F3 for a
period of 15 years.
x Ciel II. Ciel II, a Canadian DBS satellite, was launched in December 2008 and commenced commercial
operation at the 129 degree orbital location in February 2009. This satellite, which has both spot beam
capabilities and the ability to provide service to the entire continental United States (“CONUS”), will
support our expansion of national and local HD services and provide additional backup capacity. We have
leased 100% of the capacity of this satellite for a period of ten years.
Satellites under Construction. As of December 31, 2008, we had entered into the following contracts to construct
new satellites which are contractually scheduled to be completed within the next two years.
x EchoStar XIV. During 2007, we entered into a contract for the construction of EchoStar XIV, a DBS
satellite, which is expected to be completed during 2009. This satellite has been designed with a
combination of CONUS and spot beam capacity and could be used at multiple orbital locations. EchoStar
XIV will enable better bandwidth utilization, provide back-up protection for our existing offerings, and
could allow DISH Network to offer other value-added services.
x EchoStar XV. In April 2008, we entered into a contract for the construction of EchoStar XV, a DBS
satellite, which is expected to be completed during 2010. This satellite will provide CONUS service and
enable better bandwidth utilization, provide back-up protection for our existing offerings, and could allow
us to offer other value-added services.
In addition, we have agreed to lease capacity on two satellites from EchoStar which are currently under construction.
x Nimiq 5. In March 2008, we entered into a ten-year transponder service agreement with EchoStar to lease
16 DBS transponders on Nimiq 5, a Canadian DBS satellite which is expected to be completed during
2009. Upon expiration of the initial term, we have the option to renew the transponder service agreement
on a year-to-year basis through the end-of-life of the Nimiq 5 satellite. Upon a launch failure, in-orbit
failure or end-of-life of the Nimiq 5 satellite, and in certain other circumstances, we have certain rights to
receive service from EchoStar on a replacement satellite. Nimiq 5 will provide CONUS service and enable
better bandwidth utilization, provide back-up protection for our existing offerings, and could allow us to
offer other value-added services.