Dish Network 2014 Annual Report Download - page 44

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If we were to switch to another provider of set-top boxes, we may have to implement additional infrastructure to
support the set-top boxes purchased from such new provider, which could significantly increase our costs. In
addition, differences in, among other things, the user interface between set-top boxes provided by EchoStar and
those of any other provider could cause subscriber confusion, which could increase our costs and have a material
adverse effect on our gross new subscriber activations and subscriber churn. Furthermore, switching to a new
provider of set-top boxes may cause a reduction in our supply of set-top boxes and thus delay our ability to ship set-
top boxes, which could have a material adverse effect on our gross new subscriber activations and subscriber churn
rate and cause related revenue to decline.
We operate in an extremely competitive environment and our success may depend in part on our timely
introduction and implementation of, and effective investment in, new competitive products and services, the
failure of which could negatively impact our business.
Our operating results are dependent to a significant extent upon our ability to continue to introduce new products
and services and to upgrade existing products and services on a timely basis, and to reduce costs of our existing
products and services. We may not be able to successfully identify new product or service opportunities or develop
and market these opportunities in a timely or cost-effective manner. The research and development of new,
technologically advanced products is a complex and uncertain process requiring high levels of innovation and
investment. The success of new product and service development depends on many factors, including among
others, the following:
 difficulties and delays in the development, production, timely completion, testing and marketing
of products and services;
 the cost of the products and services;
 proper identification of customer need and customer acceptance of products and services;
 the development of, approval of and compliance with industry standards;
 the significant amount of resources we must devote to the development of new technologies; and
 the ability to differentiate our products and services and compete with other companies in the
same markets.
If our products and services, including without limitation, our Hopper and Joey set-top boxes, are not competitive or
do not work properly, our business could suffer and our financial performance could be negatively impacted. If the
quality of our products and services do not meet our customers’ expectations or our products are found to be
defective, then our sales and revenues, and ultimately our reputation, could be negatively impacted.
Technology in our industry changes rapidly and our inability to offer new subscribers and upgrade existing
subscribers with more advanced equipment could cause our products and services to become obsolete.
Technology in the pay-TV industry changes rapidly as new technologies are developed, which could cause our
products and services to become obsolete. We and our suppliers may not be able to keep pace with technological
developments. If the new technologies on which we intend to focus our research and development investments fail
to achieve acceptance in the marketplace, our competitive position could be negatively impacted causing a reduction
in our revenues and earnings. We may also be at a competitive disadvantage in developing and introducing complex
new products and services because of the substantial costs we may incur in making these products or services
available across our installed base of approximately 14 million subscribers. For example, our competitors could use
proprietary technologies that are perceived by the market as being superior. Further, after we have incurred
substantial costs, one or more of the products or services under our development, or under development by one or
more of our strategic partners, could become obsolete prior to it being widely adopted.
In addition, our competitive position depends in part on our ability to offer new subscribers and upgrade existing
subscribers with more advanced equipment, such as receivers with DVR and HD technology and by otherwise
making additional infrastructure investments, such as those related to our information technology and call centers.
Furthermore, the continued demand for HD programming continues to require investments in additional satellite
capacity. We may not be able to pass on to our subscribers the entire cost of these upgrades and infrastructure
investments.