Dish Network 2008 Annual Report Download - page 90

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DISH NETWORK CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
F-8
1. Organization and Business Activities
Principal Business
DISH Network Corporation is a holding company. Its subsidiaries (which together with DISH Network
Corporation are referred to as “DISH Network,” the “Company,” “we,” “us” and/or “our”) operate the
DISH Network® television service, which provides a direct broadcast satellite (“DBS”) subscription
television service in the United States and had 13.678 million subscribers as of December 31, 2008. We
have deployed substantial resources to develop the “DISH Network DBS System.” The DISH Network
DBS System consists of our licensed Federal Communications Commission (“FCC”) authorized DBS and
Fixed Satellite Service (“FSS”) spectrum, our owned and leased satellites, receiver systems, third-party
broadcast operations, customer service facilities, in-home service and call center operations and certain
other assets utilized in our operations.
Spin-off of Technology and Certain Infrastructure Assets
On January 1, 2008, we completed a tax-free distribution of our technology and set-top box business and
certain infrastructure assets (the “Spin-off”) into a separate publicly-traded company, EchoStar
Corporation (“EchoStar”). DISH Network and EchoStar now operate as separate publicly-traded
companies, and neither entity has any ownership interest in the other. However, a substantial majority of
the voting power of both companies is owned beneficially by Charles W. Ergen, our Chief Executive
Officer and Chairman of our board of directors. The two entities consist of the following:
x DISH Network Corporation – which retained its subscription television business, the DISH
Network®, and
x EchoStar Corporation – which sells equipment, including set-top boxes and related components,
to DISH Network and international customers, and provides digital broadcast operations and
satellite services to DISH Network and other customers.
The Spin-off of EchoStar did not result in the discontinuance of any of our ongoing operations as the cash
flows related to, among others things, purchases of set-top boxes, transponder leasing and digital
broadcasting services that we purchase from EchoStar continue to be included in our operations.
Our shareholders of record on December 27, 2007 received one share of EchoStar common stock for every
five shares of each class of DISH Network common stock they held as of the record date.