Dish Network 2015 Annual Report Download - page 68

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providers. For example, on February 10, 2016, we filed an application with the FCC to potentially participate as a bidder
in the upcoming Auction 1000. Auction 1000 is scheduled to begin on March 29, 2016. The FCC determined that
bidding in Auction 1000 will be “anonymous,” which means that prior to and during the course of the auction, the FCC
will not make public any information about a specific applicant’s upfront deposits or its bids. In addition, FCC rules
restrict information that bidders may disclose about their participation in Auction 1000. See Note 15 “Commitments and
Contingencies — Wireless — DISH Network Spectrum” in the Notes to our Consolidated Financial Statements in this
Annual Report on Form 10-K for further information.
DISH Network Non-Controlling Investments in the Northstar Entities and the SNR Entities Related to AWS-3 Wireless
Spectrum Licenses
Through our wholly-owned subsidiaries American II and American III, we have made over $10.0 billion in certain non-
controlling investments in Northstar Spectrum, the parent company of Northstar Wireless, and in SNR HoldCo, the
parent company of SNR Wireless, respectively. On October 27, 2015, the FCC granted the Northstar Licenses to
Northstar Wireless and the SNR Licenses to SNR Wireless, respectively, which are recorded in “FCC authorizations” on
our Consolidated Balance Sheets. Under the applicable accounting guidance in ASC 810, Northstar Spectrum and SNR
HoldCo are considered variable interest entities and, based on the characteristics of the structure of these entities and in
accordance with the applicable accounting guidance, we have consolidated these entities into our financial statements
beginning in the fourth quarter 2014. See Note 2 in the Notes to our Consolidated Financial Statements in this Annual
Report on Form 10-K for further information. The AWS-3 Licenses are subject to certain interim and final build-out
requirements. We may need to make significant additional loans to the Northstar Entities and to the SNR Entities, or
they may need to partner with others, so that the Northstar Entities and the SNR Entities may commercialize, build-out
and integrate the Northstar Licenses and the SNR Licenses, and comply with regulations applicable to the Northstar
Licenses and the SNR Licenses. Depending upon the nature and scope of such commercialization, build-out, integration
efforts, and regulatory compliance, any such loans or partnerships could vary significantly. See Note 15 “Commitments
and Contingencies — Wireless — DISH Network Non-Controlling Investments in the Northstar Entities and the SNR
Entities Related to AWS-3 Wireless Spectrum Licenses” in the Notes to our Consolidated Financial Statements in this
Annual Report on Form 10-K for further information.
We may need to raise significant additional capital in the future to fund the efforts described above, which may not be
available on acceptable terms or at all. There can be no assurance that we, the Northstar Entities and/or the SNR Entities
will be able to develop and implement business models that will realize a return on these wireless spectrum licenses or
that we, the Northstar Entities and/or the SNR Entities will be able to profitably deploy the assets represented by these
wireless spectrum licenses, which may affect the carrying amount of these assets and our future financial condition or
results of operations. See Note 15 “Commitments and Contingencies — Wireless” in the Notes to our Consolidated
Financial Statements in this Annual Report on Form 10-K for further information.
Trends in our DISH Segment
Competition
Competition has intensified in recent years as the pay-TV industry has matured. With respect to our DISH branded
pay-TV services, we and our competitors increasingly must seek to attract a greater proportion of new subscribers from
each other’s existing subscriber bases rather than from first-time purchasers of pay-TV services. Some of our
competitors have been especially aggressive by offering discounted programming and services for both new and existing
subscribers, including bundled offers combining broadband, video and/or wireless services and other promotional offers.
In some cases, certain competitors have been able to potentially subsidize the price of video services with the price of
broadband and/or wireless services. We incur significant costs to retain our existing DISH branded pay-TV customers,
mostly as a result of upgrading their equipment to HD and DVR receivers and by providing retention credits. Our
subscriber retention costs may vary significantly from period to period. Our Pay-TV services also face increased
competition from content providers and other companies who distribute video directly to consumers over the Internet.
Programming offered over the Internet has become more prevalent and consumers are spending an increasing amount of
time accessing video content via the Internet on their mobile devices. Significant changes in consumer behavior with
regard to the means by which consumers obtain video entertainment and information in response to digital media