Dish Network 2015 Annual Report Download - page 36

26
x The adoption or modification of laws and regulations relating to the Internet could limit or otherwise
adversely affect the manner in which we conduct our Sling TV services and could cause us to incur
additional expenses or alter our business model; and
x We rely on EchoStar to provide the streaming delivery technology and infrastructure to support our Sling
TV services. In addition, we license our OTT service brand name “Sling” from EchoStar, and there can be
no assurance that we will be able to continue to license the “Sling” brand name on acceptable terms or at
all.
We face increasing competition from other distributors of unique programming services such as foreign language
and sports programming that may limit our ability to maintain subscribers that desire these unique programming
services.
We face increasing competition from other distributors of unique programming services such as foreign language and
sports programming, including programming distributed over the Internet. There can be no assurance that we will
maintain subscribers that desire these unique programming services. For example, the increasing availability of foreign
language programming from our competitors, which in certain cases has resulted from our inability to renew
programming agreements on an exclusive basis or at all, as well as competition from piracy-based video offerings, could
contribute to an increase in our subscriber churn. Our agreements with distributors of foreign language programming
have varying expiration dates, and some agreements are on a month-to-month basis. There can be no assurance that we
will be able to grow or maintain subscribers that desire these unique programming services such as foreign language and
sports programming.
Operational and Service Delivery Risks
If we do not continue improving our operational performance and customer satisfaction, our gross new subscriber
activations may decrease and our subscriber churn may increase.
If we are unable to continue improving our operational performance and customer satisfaction, we may experience a
decrease in gross new subscriber activations and an increase in subscriber churn, which could have a material adverse
effect on our business, financial condition and results of operations. To improve our operational performance, we
continue to make investments in staffing, training, information systems, and other initiatives, primarily in our call center
and in-home service operations. These investments are intended to help combat inefficiencies introduced by the
increasing complexity of our business, improve customer satisfaction, reduce subscriber churn, increase productivity,
and allow us to scale better over the long run. We cannot, however, be certain that our spending will ultimately be
successful in improving our operational performance, and if unsuccessful, we may have to incur higher costs to improve
our operational performance. While we believe that such costs will be outweighed by longer-term benefits, there can be
no assurance when or if we will realize these benefits at all. If we are unable to improve our operational performance,
our future gross new subscriber activations and existing subscriber churn may be negatively impacted, which could in
turn adversely affect our revenue growth and results of operations.
If our gross new subscriber activations decrease, or if our subscriber churn, subscriber acquisition costs or retention
costs increase, our financial performance will be adversely affected.
We may incur increased costs to acquire new subscribers and retain existing subscribers. Our subscriber acquisition
costs could increase as a result of increased spending for advertising and, with respect to our DISH branded pay-TV
services, the installation of more HD and DVR receivers, which are generally more expensive than other receivers.
Meanwhile, retention costs may be driven higher by providing retention credits and, with respect to our DISH branded
pay-TV services, by increased upgrades of existing subscribers’ equipment to HD and DVR receivers. Additionally,
certain of our promotions, including, among others, pay-in-advance, allow consumers with relatively lower credit scores
to become subscribers. These subscribers typically churn at a higher rate.