Segment Reporting

3 Months Ended

Mar. 31, 2013

Segment Reporting

Segment Reporting

13.          Segment Reporting

Operating segments are components of an enterprise for which separate financial information is available and regularly evaluated by the chief operating decision maker(s) of an enterprise.  Operating income is the primary measure used by our chief operating decision maker to evaluate segment operating performance.  We operate three primary business segments.

· DISH.  The DISH branded DBS pay-TV service had 14.092 million subscribers in the United States as of March 31, 2013.  The DISH branded pay-TV service consists of FCC licenses authorizing us to use DBS and FSS spectrum, our owned and leased satellites, receiver systems, third party broadcast operations, customer service facilities, a leased fiber network, in-home service and call center operations, and certain other assets utilized in our operations.  In addition, we market broadband services under the dishNET brand.

·      Blockbuster.  On April 26, 2011, we completed the Blockbuster Acquisition.  The financial results of our Blockbuster operations are included in our financial results beginning April 26, 2011.  Blockbuster primarily offers movies and video games for sale and rental through multiple distribution channels such as retail stores, by-mail, digital devices, the blockbuster.com website and the BLOCKBUSTER On Demand service.

· Wireless.  In 2008, we paid $712 million to acquire certain 700 MHz wireless spectrum licenses, which were granted to us by the FCC in February 2009.  On March 9, 2012, we completed the DBSD Transaction and the TerreStar Transaction, pursuant to which we acquired, among other things, 40 MHz of 2 GHz wireless spectrum licenses held by DBSD North America and TerreStar.  The financial results of DBSD North America and TerreStar are included in our financial results beginning March 9, 2012.  The total consideration to acquire the DBSD North America and TerreStar assets was approximately $2.860 billion.  See Note 8 for further information.

We currently generate an immaterial amount of revenue and incur operating expenses associated with certain satellite operations and regulatory compliance matters from our wireless spectrum assets.  As we review our options for the commercialization of this wireless spectrum, we may incur significant additional expenses and may have to make significant investments related to, among other things, research and development, wireless testing and construction of a wireless network.

The total assets, revenue and operating income by segment are as follows:

	As of
	March 31,			December 31,
	2013			2012
	(In thousands)
Total assets:
DISH	$	13,946,338		$	13,568,087
Blockbuster (1)	278,710			357,267
Wireless	4,087,404			4,062,383
Eliminations	(658,053		)	(608,129		)
Total assets	$	17,654,399		$	17,379,608

	For the Three Months
	Ended March 31,
	2013			2012
	(In thousands)
Revenue:
DISH	$	3,379,043		$	3,252,922
Blockbuster (1)	180,324			333,991
Wireless (2)	650			33
Eliminations	(4,793		)	(5,077		)
Total revenue	$	3,555,224		$	3,581,869
Operating income (loss):
DISH	$	469,632		$	566,545
Blockbuster	623			13,957
Wireless (2)	(18,002		)	(8,091		)
Total operating income (loss)	$	452,253		$	572,411

(1) The decrease for the three months ended March 31, 2013 primarily related to the deconsolidation of Blockbuster UK on January 16, 2013.  See Note 9 for further information.

(2) The three months ended March 31, 2012 includes Wireless results from the acquisitions of DBSD North America and TerreStar on March 9, 2012.

Geographic Information.  Revenues are attributed to geographic regions based upon the location where the products are delivered and services are provided.  The following table summarizes revenue attributed to the United States and foreign locations.

	For the Three Months Ended March 31,
	2013		2012
	(In thousands)
Revenue:
United States	$	3,490,475	$	3,457,835
United Kingdom (1)	10,883		70,711
Mexico	45,329		41,306
Other	8,537		12,017
Total revenue	$	3,555,224	$	3,581,869

(1) The decrease for the three months ended March 31, 2013 primarily related to the deconsolidation of Blockbuster UK on January 16, 2013.  See Note 9 for further information.