Will receivers be upgraded to MPEG4 free?

[meatman]

Well has anyone heard if dish is going to do free upgrades for the mpeg 4 hd recievers or not?

[James Long]

Nobody knows and anyone who claims one way or another is guessing.

JL

[boylehome]

Originally Posted by meatman

Well has anyone heard if dish is going to do free upgrades for the mpeg 4 hd recievers or not?

My guess is they will want $$$$.

[Stewart Vernon]

Nobody knows for sure, including probably Charlie and the rest of Echostar.

My guess would be that it would be a combination... Upgrades for the early adopters who just can't wait for some cost... but eventually a free swap for the rest of the customers if they want to completely switch to MPEG4 across the board.

Too many folks would bolt if they all had to pay... and too many folks to swap out for free... but a happy medium somewhere in there if Dish can get a bunch of us to pay for early adoption to help offset costs for later.

[dwcobb]

I would be stunned and shocked. I sincerely hope they work with existing customers to moderate the costs, but the receivers are NOT free for them to build, and they will want to recover at least part of that expense.

The more new features a new box has, the less likely it is they will cut a deal, both because each feature will make the box more expensive and because the more new things the box can do the more justifiable it is to charge someone (you would not be getting the same box in a new format, but something that does more for you).

My best hope is that it will cost about $200 or so. But honestly, I am not even expecting anything that generous.

And as JL says, no one really knows. But I simply can't imagine a "free" upgrade on this one.

[Link]

If their service becomes MPEG-4 only, then I'd think they'd have to replace the receivers. Otherwise who is going to stay with their service if they have to pay out a lot of money to get new receivers?? Many will not understand the new technology and not want to change anything with their current systems. I don't think it will be an easy transition.

[KingLoop]

All I know is this, if it is a free upgrade, our bills are going up!.

[moman19]

Originally Posted by KingLoop

All I know is this, if it is a free upgrade, our bills are going up!.

Maybe not, if swapping out all existing HD boxes (a relatively small percentage of all E* subs) for new MPEG4 units opens up large quantities of bandwidth for the HD masses. That bandwidth is golden. It makes little sense for them to suport HD on BOTH formats.

Wishful thinking..................................

[kckucera]

I would be pleased if MPEG 4 were used to improve picture quality. OK, OK, I know I am dreaming, but what if DISH actually did the right thing for once and stopped pandering to obscure ethinic groups in favor of enhanced HD and SD image quality? Imagine a world without 921 woe, a world where the MPEG 4 transistion was not at the expense of early adopters getting hosed for $1000 cash investment on a semi working product. What if DISH actually assisted those of us 921 victums by giving us a free upgrade for our pain and suffering? End of rant.

[sledhead 700]

Originally Posted by kckucera

I would be pleased if MPEG 4 were used to improve picture quality. OK, OK, I know I am dreaming, but what if DISH actually did the right thing for once and stopped pandering to obscure ethinic groups in favor of enhanced HD and SD image quality? Imagine a world without 921 woe, a world where the MPEG 4 transistion was not at the expense of early adopters getting hosed for $1000 cash investment on a semi working product. What if DISH actually assisted those of us 921 victums by giving us a free upgrade for our pain and suffering? End of rant.

Amen!!

[dwcobb]

Originally Posted by moman19

Maybe not, if swapping out all existing HD boxes (a relatively small percentage of all E* subs) for new MPEG4 units opens up large quantities of bandwidth for the HD masses. That bandwidth is golden. It makes little sense for them to suport HD on BOTH formats.

Wishful thinking..................................

I am not sure that the HD subscribers are still "relatively small." I would bet that it is a much higher % than you would guess. But even if it is, that doesn' treally matter. It is bad business to let most of your customers absorb overhead related to serving a segment of them. Yes, it is true that is how programming in general works, but for boxes, why would they want to make their business less profitable to keep things cheap for what is certainly their most affluent customer segment?

Second, you are implying that more bandwidth means more programming automatically. More HD locals, maybe. But more programming means more expense for them to carry programming, which would again mean that eventually, HD rates would have to go up to cover the extra programming expense.

The only model that really works as free is if somehow the free box increased their business. Swapping existing boxes won't do that. I just won't believe they will go that way.

It does make sense for them to cut a very good deal to help ensure they don't LOSE customers, and maybe even build loyalty. But I doubt there would be a measureable difference in their customer retention rates between a "Free" box and a $200 one.

And yes, this comes from someone who has a particularly shoddy 921.

I wouldn't build any plans around the free route. I don't expect it will happen, and if it doesn't it will only piss you off more if you build up an expectation.

[AllieVi]

If DISH switches everyone to MPEG4, the cost of doing so will be staggering. Tens of millions of older receivers like mine would have to be replaced. Even if the cost to DISH was only $100 each, the total would come to several billion dollars that I doubt DISH will be willing to absorb. The real numbers will probably be much higher. If customers are asked to ante-up funds, many will switch to something else.

Every time it looks like the satellite companies may be able to make money, an expense like this seems to come along. Fiber-optic service will take away large numbers of existing customers as it rolls out across the country in future years and cable is improving as it delivers digital signals. It's getting harder to be bullish on either satellite service.

[Ghostwriter]

Well IMO they will only be offering the newer MPEG4 receivers to new customers where the HD LiL rollout starts. I guess they hope there are more than a few "gotta have it now at whatever price" customers out there. Personally I think HD subs are a very small percentage of the E* subs as of today, and most of the "regular" SD customers will not throw E* money for their new MPEG4 receiver considering D* at this moment is actually giving you a dollar for their MPEG4 receiver.


E* has to watch where they tread here. Considering D* already has a small head start it HD LIL rollout and obtaining the 1st receiver at no cost, E* has to have a solid plan for new subs and a fair upgrade option for existing subs.

[rocatman]

Folks need to look at the transition to MPEG-4 as actually two transitions as was somewhat mentioned in the November Technical Chat. HD channels will be migrated to MPEG-4 while SD channels will be migrated to 8PSK from QPSK. This latter transition provides Dish with a 33 - 50 percent increase in bandwidth capacity i.e., from 12 SD channels/TP to 16 - 18 SD channels/TP. For example for the 119 W slot, Dish uses 16 TPs for SD CONUS channels. With just a 33% increase in bandwidth using 8PSK, Dish would only have to use 12 TPs freeing up 4 TPs. I believe this transition to 8PSK for the SD channels would also allow Dish to put both HD/MPEG-4/8PSK channels and SD/MPEG-2/8PSK channels on a single TP which can result in a better utilization in TP capacity. For example, currently Dish jams 3 HD channels/TP using MPEG-2/8PSK because otherwise they would throw away a significant amount of bandwidth putting only 2 HD channels/TP. Now if Dish can put both HD and SD channels on a single TP they may be able increase the resolution of the HD channels by putting fewer HD channels per TP and then backfill what is left with SD channels that require less bandwidth.

I know the discussion has been focused on the swapout of receivers but one needs to understand the two transitions to understand what Dish can and needs to do regarding receiver swapouts. Dish needs to start eliminating non-MPEG-4 HD receivers as well as non-8PSK receivers. Realize though that non-MPEG-4 HD receivers can be used to replace non-8PSK receivers. I am sure there are a number of folks who would gladly have there old 2000, 3000, 4000 series receivers replaced with a used 811 that would give them the ability to receive HD OTA channels and have a faster programming guide. I am sure some 5xx owners would gladly pay something to swap their DVR for a used 942 even if the ability to receive satellite HD channels was disabled. By doing this Dish can defray some of their transition costs and keep costs lower for their subscribers.

[James Long]

I realize that next month's chat is supposed to be a HD chat - but I would really be happy to see E* go back to the November Tech Forum HD answer and explain that "Turbo" coding that is expected to give 30-50% more efficiency on 10 million existing receivers. There is something to what was said - but something wrong too.

I don't see E* using the "hand me down" receiver approach. I believe they will do their best to keep as many current receivers working and limit the need to upgrade to special cases (with a special offer) and bleeding edge consumers who will pay full price. They do need to get the four digit receivers off of the system.

JL

[Rob O]

It seems to me that at least a portion of the E* strategy would be to start bringing in new HD subscribers with the offering of the local HD networks and better national HD offerings (major advertising campaign). I for one have been sitting on the fence about subscribing because of the lack of the local HD's. I can not get them OTA without significant investment in an antenna setup.

It seems like E* might be able to recoup some of their investment in new MPEG-4 receivers by increasing HD subscribers and providing upgrades at some reasonable expense to new subscribers as well as existing HD subs (at least I can hope so !)

[Codeman00]

Originally Posted by James Long

I realize that next month's chat is supposed to be a HD chat - JL

When is the HD chat?

[navychop]

Next HD chat is 1/9/06

[navychop]

AllieVi-

DISH has about 12 million subs. Let's say that translates into roughly 25 million receivers. At $100 @ (your estimate), that's about $2,500,000,000. In other words, 2.5 billion in American English, or 25 hundred million in British English. This assumes every single receiver must be replaced, without discussing over how many years.

So what is the alternative? Buying and launching a satellite? Obtaining licenses, setting up more uplink capacity (to aim at another satellite), and many other expenses? Several hundred million, at least.

It may not cost them as much, considering the offsetting savings of NOT launching a satellite or 2. Plus, the new receivers will offer the potential for more income- HD, VOD (ok- "sorta-VOD"), and perhaps other, possibly interactive features.

All new DISH receivers will be 8PSK, HD, and MPEG-4 capable. I suspect they will all have ethernet also, after the 411. About half the receivers out there now are 8PSK capable. The faster they complete the rollout, the faster they can reap the benefits. But it costs them more up front to roll out the new receivers quickly.

I'll bet they don't have a firm timetable. They will replace current offerings to new subs with new, fully capable receivers. People adding HD-LiLs and later, new HD, will get some sort of deal on new receivers- after MPEG-4 encoders get efficient enough and DISH starts broadcasting in that mode. As the efficiency goes up, receiver costs go down (MPEG-4 chips are new and pricey), and enticement programs pull obsolete receivers out of circulation, DISH can plan the phase in. Plus, the success or failure of Echostar X will no doubt be a factor.

The previously expected, 3 year timetable may not be long enough. Over some period of years, as the number of subs increases and people upgrade or replace for other reasons, the % of receivers with the new capabilities will grow, and the absolute number of old receivers will dwindle. So while I expect essentially all transmissions to eventually move to MPEG-4 encoding with 8PSK modulation, the SD changeover may be long in coming.

Since all equipment has an expected lifespan, DISH may consider the 4 digit receivers to all be past reasonable use and feel no obligation to replace them. But I'll bet they'll offer some deal anyway- customer satisfaction and the chance to increase revenue from those customers, who would (presumably) get new capabilities with the new receivers. The replacements will all no doubt be the low end, cheapest receivers. It's the DVR folks they need to entice to upgrade before any offers come out, to minimize their costs.

More guessing: Let's pull a SWAG and estimate that on 1/1/10 DISH will have about 18-20 million subs, and 5-10 million non-MPEG-4 receivers in use. They can spread that, oh, say approximately 1 billion dollar cost, over 50% to 100% more subs. It may well be less, because electronics, including hard drives, continue to decline in price. Any they will have deferred a satellite launch or two.

Same story, different thread.

[SHS]

DISH may have about 12+ million subs but that translates more like 3x that with avg house hold having about 2 receiver with maybe about 30% of that 3 to 4+ receiver.
And if I unstand the rules you can only have 2 HD receiver per house hold but hopely Dish will change this after all everything is going by HD by 2008/9.

[LtMunst]

Originally Posted by SHS

And if I unstand the rules you can only have 2 HD receiver per house hold but hopely Dish will change this after all everything is going by HD by 2008/9.

The law says everything must be Digital by 2009, not HD. All Dish channels are already Digital.

[navychop]

Everything going HD may mean all the receivers being shipped being HD capable.

I figured an average of about 2 receivers per sub, total 25 million receivers. That may be high- a LOT of subs have just the one receiver. Anyone know of a source for good figures on this?

Even if there are 30 or 40 million receivers out there today, in 3 or 4 years, that number will be WAY down. And the number of subs will be way up. The E* strategy of putting this off and phasing in slowly will likely save them money at little or no loss to the subs.

There is no 2 receiver per household limit that I know of. I think it's 6, maybe 8, HD or not. Someone have definite knowledge on this?

[AllieVi]

Originally Posted by navychop

... So what is the alternative? Buying and launching a satellite? Obtaining licenses, setting up more uplink capacity (to aim at another satellite), and many other expenses? Several hundred million, at least. ...

My post was intended to show the magnitude of the expense DISH will incur. My estimate of $100 per receiver was simply to make the math easy and not intended to be realistic. I expect the numbers would be much higher.

My post was more for the benefit of DISH investors, not customers. I don't believe delivery of satellite programming will be a profitable business in the future as things stand. In the early days, satellite had a better picture and offered more channels than cable, so customers came running (particularly in remote areas).

I doubt the customer numbers will increase dramatically in the future, though. Fiber and digital cable options will change the landscape. I've read that fiber bandwidth may allow channels to be provided without the need for the compression that will cost satellite billions. Ain't that a kick in the head?

[navychop]

Satellite will beat coax cable indefinitely. Nature of the delivery system- coax transmission paths require too much maintenance and tweaking. Fiber is another story. But getting fiber out to a significant portion of the population will take many, many years. I live in northern VA and in my neighborhood, it's 3-7 years out. Think how long it will take to get to areas with smaller population densities. Satellite has a lot of growth still remaining, for years to come. I think microwave delivery systems may become yet another competitor- but not a killer.

[tnsprin]

Originally Posted by navychop

AllieVi-

...As the efficiency goes up, receiver costs go down (MPEG-4 chips are new and pricey), ...

Actually the new MPEG-4 chips, I believe they are using the ones from Broadcom (BCM7411?), are not that pricey.

Its having to replace the whole works and redo software to support it that is pricey.