Dish Network 2013 Annual Report Download - page 123

DISH NETWORK CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
F-13
Fair values for our publicly traded debt securities are based on quoted market prices, when available. The fair
values of private debt are estimated based on an analysis in which we evaluate market conditions, related securities,
various public and private offerings, and other publicly available information. In performing this analysis, we make
various assumptions regarding, among other things, credit spreads, and the impact of these factors on the value of
the debt securities. See Note 11 for the fair value of our long-term debt.
Deferred Debt Issuance Costs
Costs of issuing debt are generally deferred and amortized to interest expense ratably over the terms of the respective
notes. See Note 11.
Revenue Recognition
We recognize revenue when an arrangement exists, prices are determinable, collectability is reasonably assured and
the goods or services have been delivered.
Revenue from our pay-TV service is recognized when programming is broadcast to subscribers. We recognize
revenue from our broadband services when the service is provided. Payments received from Pay-TV and
Broadband subscribers in advance of the broadcast or service period are recorded as “Deferred revenue and other”
in our Consolidated Balance Sheets until earned.
For certain of our promotions, subscribers are charged an upfront fee. A portion of these fees may be deferred and
recognized over the estimated subscriber life for new subscribers or the estimated remaining life for existing subscribers
ranging from 18 months to five years. Revenue from advertising sales is recognized when the related services are
performed.
Subscriber fees for pay-TV equipment rental and other hardware related fees, including fees for DVRs, fees for
broadband equipment, equipment upgrade fees and additional outlet fees from subscribers with receivers with
multiple tuners, advertising services and fees earned from our in-home service operations are recognized as revenue
as earned. Generally, revenue from equipment sales and equipment upgrades is recognized upon shipment to
customers.
Certain of our existing and new subscriber promotions include programming discounts. Programming revenues are
recorded as earned at the discounted monthly rate charged to the subscriber.
We offer our customers the opportunity to download movies for a specific viewing period or permanently purchase
a movie from our web-site. We recognize revenue when the movie is successfully downloaded by the customer,
which, based on our current technology, occurs at the time the customer plays the movie for the first time.
Subscriber-Related Expenses
The cost of television programming distribution rights is generally incurred on a per subscriber basis and various
upfront carriage payments are recognized when the related programming is distributed to subscribers. Long-term
flat rate programming contracts are charged to expense using the straight-line method over the term of the
agreement. The cost of television programming rights to distribute live sporting events for a season or tournament
is charged to expense using the straight-line method over the course of the season or tournament.
“Subscriber-related expenses” in the Consolidated Statements of Operations and Comprehensive Income (Loss)
principally include programming expenses, costs for pay-TV and broadband services incurred in connection with
our in-home service and call center operations, billing costs, refurbishment and repair costs related to receiver
systems, subscriber retention, other variable subscriber expenses and monthly wholesale fees paid to broadband