Property and Equipment

6 Months Ended

Jun. 30, 2016

Property and Equipment

Property and Equipment

6.Property and Equipment

Depreciation and amortization expense consisted of the following:

	For the Three Months				For the Six Months Ended
	Ended June 30,				Ended June 30,
	2016		2015		2016		2015
	(In thousands)
Equipment leased to customers	$	197,352	$	206,314	$	378,003	$	398,067
Satellites		15,262		15,261		30,523		30,522
Buildings, furniture, fixtures, equipment and other		16,349		15,673		32,691		32,554
Total depreciation and amortization	$	228,963	$	237,248	$	441,217	$	461,143

Cost of sales and operating expense categories included in our accompanying Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) do not include depreciation expense related to satellites or equipment leased to customers.

Pay-TV Satellites.  We currently utilize 12 satellites in geostationary orbit approximately 22,300 miles above the equator, one of which we own and depreciate over its estimated useful life.  We currently utilize certain capacity on nine satellites that we lease from EchoStar, which are accounted for as operating leases.  We also lease two satellites from third parties, which are accounted for as capital leases and are depreciated over the shorter of the economic life or the term of the satellite agreement.

As of June 30, 2016, our pay-TV satellite fleet consisted of the following:

			Estimated
			Useful Life
			(Years)/
		Degree	Lease
	Launch	Orbital	Termination
Satellites	Date	Location	Date
Owned:
EchoStar XV	July 2010	61.5	15
EchoStar XVIII (1)	June 2016	61.5	15
Leased from EchoStar (2):
EchoStar VII (3)	February 2002	119	June 2017
EchoStar IX	August 2003	121	Month to month
EchoStar X (3)	February 2006	110	February 2021
EchoStar XI (3)	July 2008	110	September 2021
EchoStar XII (3)	July 2003	61.5	September 2017
EchoStar XIV (3)	March 2010	119	February 2023
EchoStar XVI (4)	November 2012	61.5	January 2018
Nimiq 5	September 2009	72.7	September 2019
QuetzSat-1	September 2011	77	November 2021
Leased from Other Third Party:
Anik F3	April 2007	118.7	April 2022
Ciel II	December 2008	129	January 2019

(1) The EchoStar XVIII satellite was launched on June 18, 2016 and is expected to become operational at the 61.5 degree orbital location during the third quarter 2016.  The EchoStar XVIII satellite is currently owned by an indirect subsidiary of DISH Network.

(2) See Note 10 for further information on our Related Party Transactions with EchoStar.

(3) We generally have the option to renew each lease on a year-to-year basis through the end of the useful life of the respective satellite.

(4) We have the option to renew this lease for an additional five-year period.  If we exercise our five-year renewal option, we have the option to renew this lease for an additional five years.