Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2020 | Jul. 31, 2020 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-39144 | |
Entity Registrant Name | DISH Network Corporation | |
Entity Tax Identification Number | 88-0336997 | |
Entity Incorporation, State or Country Code | NV | |
Entity Address, Address Line One | 9601 South Meridian Boulevard | |
Entity Address, City or Town | Englewood | |
Entity Address, State or Province | CO | |
Entity Address, Postal Zip Code | 80112 | |
City Area Code | 303 | |
Local Phone Number | 723-1000 | |
Title of 12(b) Security | Class A common stock, $0.01 par value | |
Trading Symbol | DISH | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001001082 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Class A common stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 286,869,973 | |
Class B common stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 238,435,208 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Current Assets: | ||
Cash and cash equivalents | $ 2,589,817 | $ 2,443,643 |
Marketable investment securities | 40,202 | 416,704 |
Trade accounts receivable, net of allowance for credit losses and allowance for doubtful accounts of $49,068 and $19,280, respectively | 531,827 | 588,358 |
Inventory | 315,369 | 322,898 |
Other current assets | 631,359 | 243,497 |
Total current assets | 4,108,574 | 4,015,100 |
Noncurrent Assets: | ||
Restricted cash, cash equivalents and marketable investment securities | 61,349 | 61,067 |
Property and equipment, net | 2,271,425 | 2,706,182 |
FCC authorizations | 26,431,094 | 25,779,503 |
Other investment securities | 147,863 | 160,074 |
Operating lease assets | 113,852 | 144,330 |
Other noncurrent assets, net | 363,317 | 364,679 |
Total noncurrent assets | 29,388,900 | 29,215,835 |
Total assets | 33,497,474 | 33,230,935 |
Current Liabilities: | ||
Trade accounts payable | 372,266 | 280,645 |
Deferred revenue and other | 659,500 | 681,484 |
Accrued programming | 1,683,468 | 1,308,531 |
Accrued interest | 226,390 | 236,087 |
Other accrued expenses | 765,176 | 817,978 |
Current portion of long-term debt and finance lease obligations | 2,073,410 | 1,171,366 |
Total current liabilities | 5,780,210 | 4,496,091 |
Long-Term Obligations, Net of Current Portion: | ||
Long-term debt and finance lease obligations, net of current portion | 10,985,852 | 12,968,229 |
Deferred tax liabilities | 2,992,146 | 2,870,655 |
Operating lease liabilities | 77,713 | 84,795 |
Long-term deferred revenue and other long-term liabilities | 896,201 | 695,018 |
Total long-term obligations, net of current portion | 14,951,912 | 16,618,697 |
Total liabilities | 20,732,122 | 21,114,788 |
Commitments and Contingencies (Note 10) | ||
Redeemable noncontrolling interests (Note 2) | 605,815 | 552,075 |
Stockholders' Equity (Deficit): | ||
Additional paid-in capital | 5,019,179 | 4,947,007 |
Accumulated other comprehensive income (loss) | (2,664) | (18) |
Accumulated earnings (deficit) | 7,137,744 | 6,612,302 |
Total DISH Network stockholders' equity (deficit) | 12,159,505 | 11,564,521 |
Noncontrolling interests | 32 | (449) |
Total stockholders' equity (deficit) | 12,159,537 | 11,564,072 |
Total liabilities and stockholders' equity (deficit) | 33,497,474 | 33,230,935 |
Class A common stock | ||
Stockholders' Equity (Deficit): | ||
Common stock | 2,862 | 2,846 |
Class B common stock | ||
Stockholders' Equity (Deficit): | ||
Common stock | $ 2,384 | $ 2,384 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Current Assets: | ||
Allowance for doubtful accounts on trade accounts receivable | $ 49,068 | $ 19,280 |
Common stock par value (in dollars per share) | $ 86.08 | |
Class A common stock | ||
Current Assets: | ||
Common stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 1,600,000,000 | 1,600,000,000 |
Common stock, shares issued | 286,125,660 | 284,603,818 |
Common stock, shares outstanding | 286,125,660 | 284,603,818 |
Class B common stock | ||
Current Assets: | ||
Common stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 800,000,000 | 800,000,000 |
Common stock, shares issued | 238,435,208 | 238,435,208 |
Common stock, shares outstanding | 238,435,208 | 238,435,208 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Revenue: | ||||
Total revenue | $ 3,187,090 | $ 3,211,312 | $ 6,404,479 | $ 6,398,456 |
Costs and Expenses (exclusive of depreciation shown separately below - Note 7): | ||||
Subscriber-related expenses | 1,884,743 | 2,000,961 | 3,845,409 | 4,005,968 |
Satellite and transmission expenses | 71,406 | 138,008 | 146,258 | 277,509 |
Cost of sales - equipment and other | 29,319 | 51,073 | 71,029 | 91,457 |
Subscriber acquisition costs: | ||||
Cost of sales - subscriber promotion subsidies | 1,159 | 3,007 | 10,048 | 9,524 |
Other subscriber acquisition costs | 109,055 | 108,289 | 222,957 | 188,764 |
Subscriber acquisition advertising | 89,510 | 126,782 | 220,592 | 233,689 |
Total subscriber acquisition costs | 199,724 | 238,078 | 453,597 | 431,977 |
General and administrative expenses | 212,124 | 202,758 | 431,096 | 401,672 |
Depreciation and amortization (Note 7) | 152,124 | 149,702 | 318,944 | 302,841 |
Impairment of long-lived assets (Note 2) | 356,418 | |||
Total costs and expenses | 2,549,440 | 2,780,580 | 5,622,751 | 5,511,424 |
Operating income (loss) | 637,650 | 430,732 | 781,728 | 887,032 |
Other Income (Expense): | ||||
Interest income | 5,578 | 18,476 | 19,794 | 33,643 |
Interest expense, net of amounts capitalized | (11,494) | (5,650) | (27,100) | (11,571) |
Other, net | 16 | 2,832 | 1,608 | 11,920 |
Total other income (expense) | (5,900) | 15,658 | (5,698) | 33,992 |
Income (loss) before income taxes | 631,750 | 446,390 | 776,030 | 921,024 |
Income tax (provision) benefit, net | (151,344) | (105,824) | (196,350) | (219,159) |
Net income (loss) | 480,406 | 340,566 | 579,680 | 701,865 |
Less: Net income (loss) attributable to noncontrolling interests, net of tax | 28,063 | 23,523 | 54,238 | 45,061 |
Net income (loss) attributable to DISH Network | $ 452,343 | $ 317,043 | $ 525,442 | $ 656,804 |
Weighted-average common shares outstanding - Class A and B common stock: | ||||
Basic (in shares) | 524,292 | 469,655 | 523,722 | 468,809 |
Diluted (in shares) | 582,619 | 527,983 | 582,071 | 527,107 |
Earnings per share - Class A and B common stock: | ||||
Basic net income (loss) per share attributable to DISH Network (in dollars per share) | $ 0.86 | $ 0.68 | $ 1 | $ 1.40 |
Diluted net income (loss) per share attributable to DISH Network (in dollars per share) | $ 0.78 | $ 0.60 | $ 0.90 | $ 1.25 |
Comprehensive Income (Loss): | ||||
Net income (loss) | $ 480,406 | $ 340,566 | $ 579,680 | $ 701,865 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustments | (3,521) | 138 | (3,146) | 185 |
Unrealized holding gains (losses) on available-for-sale debt securities | 167 | 385 | (41) | 1,391 |
Recognition of previously unrealized (gains) losses on available-for-sale securities included in net income (loss) | (54) | (296) | (54) | (296) |
Deferred income tax (expense) benefit, net | 546 | (21) | 595 | (257) |
Total other comprehensive income (loss), net of tax | (2,862) | 206 | (2,646) | 1,023 |
Comprehensive income (loss) | 477,544 | 340,772 | 577,034 | 702,888 |
Less: Comprehensive income (loss) attributable to noncontrolling interests, net of tax | 28,063 | 23,523 | 54,238 | 45,061 |
Comprehensive income (loss) attributable to DISH Network | 449,481 | 317,249 | 522,796 | 657,827 |
Subscriber-related revenue | ||||
Revenue: | ||||
Total revenue | 3,149,813 | 3,162,572 | 6,315,854 | 6,310,342 |
Equipment sales and other revenue | ||||
Revenue: | ||||
Total revenue | $ 37,277 | $ 48,740 | $ 88,625 | $ 88,114 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands | Class A and B Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Earnings (Deficit) | Noncontrolling Interest | Redeemable Noncontrolling Interest | Total |
Balance at Dec. 31, 2018 | $ 4,679 | $ 3,379,093 | $ (874) | $ 5,212,790 | $ (1,499) | $ 460,068 | $ 8,594,189 |
Issuance of Class A common stock: | |||||||
Exercise of stock awards | 227 | 227 | |||||
Employee Stock Purchase Plan | 2 | 4,520 | 4,522 | ||||
Non-cash, stock-based compensation | 11,537 | 11,537 | |||||
Change in unrealized holding gains (losses) on available-for-sale debt securities, net | 1,006 | 1,006 | |||||
Deferred income tax (expense) benefit attributable to unrealized gains (losses) on available-for-sale securities | (236) | (236) | |||||
Foreign currency translation | 47 | 47 | |||||
Net income (loss) attributable to noncontrolling interests | 164 | 21,374 | 164 | ||||
Net income (loss) attributable to DISH Network | 339,761 | 339,761 | |||||
Balance at Mar. 31, 2019 | 4,681 | 3,395,377 | (57) | 5,552,551 | (1,335) | 481,442 | 8,951,217 |
Balance at Dec. 31, 2018 | 4,679 | 3,379,093 | (874) | 5,212,790 | (1,499) | 460,068 | 8,594,189 |
Issuance of Class A common stock: | |||||||
Deferred income tax (expense) benefit attributable to unrealized gains (losses) on available-for-sale securities | (257) | ||||||
Foreign currency translation | 185 | ||||||
Net income (loss) attributable to DISH Network | 656,804 | ||||||
Balance at Jun. 30, 2019 | 4,699 | 3,457,135 | 149 | 5,869,594 | (1,066) | 504,696 | 9,330,511 |
Balance at Mar. 31, 2019 | 4,681 | 3,395,377 | (57) | 5,552,551 | (1,335) | 481,442 | 8,951,217 |
Issuance of Class A common stock: | |||||||
Exercise of stock awards | 6 | 18,620 | 18,626 | ||||
Employee benefits | 11 | 26,993 | 27,004 | ||||
Employee Stock Purchase Plan | 1 | 4,040 | 4,041 | ||||
Non-cash, stock-based compensation | 12,105 | 12,105 | |||||
Change in unrealized holding gains (losses) on available-for-sale debt securities, net | 89 | 89 | |||||
Deferred income tax (expense) benefit attributable to unrealized gains (losses) on available-for-sale securities | (21) | (21) | |||||
Foreign currency translation | 138 | 138 | |||||
Net income (loss) attributable to noncontrolling interests | 269 | 23,254 | 269 | ||||
Net income (loss) attributable to DISH Network | 317,043 | 317,043 | |||||
Balance at Jun. 30, 2019 | 4,699 | 3,457,135 | 149 | 5,869,594 | (1,066) | 504,696 | 9,330,511 |
Balance at Dec. 31, 2019 | 5,230 | 4,947,007 | (18) | 6,612,302 | (449) | 552,075 | 11,564,072 |
Issuance of Class A common stock: | |||||||
Exercise of stock awards | 395 | 395 | |||||
Employee Stock Purchase Plan | 3 | 5,127 | 5,130 | ||||
Non-cash, stock-based compensation | 16,418 | 16,418 | |||||
Change in unrealized holding gains (losses) on available-for-sale debt securities, net | (208) | (208) | |||||
Deferred income tax (expense) benefit attributable to unrealized gains (losses) on available-for-sale securities | 49 | 49 | |||||
Foreign currency translation | 375 | 375 | |||||
Net income (loss) attributable to noncontrolling interests | 263 | 263 | |||||
Net income (loss) attributable to DISH Network | 73,099 | 25,912 | 73,099 | ||||
Balance at Mar. 31, 2020 | 5,233 | 4,968,947 | 198 | 6,685,401 | (186) | 577,987 | 11,659,593 |
Balance at Dec. 31, 2019 | 5,230 | 4,947,007 | (18) | 6,612,302 | (449) | 552,075 | 11,564,072 |
Issuance of Class A common stock: | |||||||
Deferred income tax (expense) benefit attributable to unrealized gains (losses) on available-for-sale securities | 595 | ||||||
Foreign currency translation | (3,146) | ||||||
Net income (loss) attributable to DISH Network | 525,442 | ||||||
Balance at Jun. 30, 2020 | 5,246 | 5,019,179 | (2,664) | 7,137,744 | 32 | 605,815 | 12,159,537 |
Balance at Mar. 31, 2020 | 5,233 | 4,968,947 | 198 | 6,685,401 | (186) | 577,987 | 11,659,593 |
Issuance of Class A common stock: | |||||||
Exercise of stock awards | 3 | (663) | (660) | ||||
Employee benefits | 8 | 28,293 | 28,301 | ||||
Employee Stock Purchase Plan | 2 | 4,209 | 4,211 | ||||
Non-cash, stock-based compensation | 18,393 | 18,393 | |||||
Change in unrealized holding gains (losses) on available-for-sale debt securities, net | 113 | 113 | |||||
Deferred income tax (expense) benefit attributable to unrealized gains (losses) on available-for-sale securities | 546 | 546 | |||||
Foreign currency translation | (3,521) | (3,521) | |||||
Net income (loss) attributable to noncontrolling interests | 235 | 235 | |||||
Net income (loss) attributable to DISH Network | 452,343 | 27,828 | 452,343 | ||||
Other | (17) | (17) | |||||
Balance at Jun. 30, 2020 | $ 5,246 | $ 5,019,179 | $ (2,664) | $ 7,137,744 | $ 32 | $ 605,815 | $ 12,159,537 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Cash Flows From Operating Activities: | ||
Net income (loss) | $ 579,680 | $ 701,865 |
Adjustments to reconcile net income (loss) to net cash flows from operating activities: | ||
Depreciation and amortization | 318,944 | 302,841 |
Impairment of long-lived assets (Note 2) | 356,418 | |
Realized and unrealized losses (gains) on investments | (90) | (3,455) |
Non-cash, stock-based compensation | 34,811 | 23,642 |
Deferred tax expense (benefit) | 122,086 | 114,033 |
Allowance for credit losses and allowance for doubtful accounts, respectively | 29,788 | 1,109 |
Other, net | 7,867 | (19,425) |
Change in long-term deferred revenue and other long-term liabilities | 103,927 | (5,177) |
Changes in current assets and current liabilities, net | 157,465 | 230,886 |
Net cash flows from operating activities | 1,710,896 | 1,346,319 |
Cash Flows From Investing Activities: | ||
Purchases of marketable investment securities | (432,173) | (512,742) |
Sales and maturities of marketable investment securities | 807,569 | 868,069 |
Purchases of property and equipment | (196,717) | (281,722) |
Capitalized interest related to FCC authorizations (Note 2) | (403,512) | (445,684) |
Purchases of FCC authorizations, including deposits (Note 10) | (134,602) | (6,734) |
Other, net | (78,116) | 17,243 |
Net cash flows from investing activities | (437,551) | (361,570) |
Cash Flows From Financing Activities: | ||
Redemption and repurchases of senior notes | (1,100,000) | (22,365) |
Repayment of long-term debt and finance lease obligations | (35,576) | (11,506) |
Net proceeds from Class A common stock options exercised and stock issued under the Employee Stock Purchase Plan | 9,076 | 27,416 |
Other, net | 1 | 49,501 |
Net cash flows from financing activities | (1,126,499) | 43,046 |
Net increase (decrease) in cash, cash equivalents, restricted cash and cash equivalents | 146,846 | 1,027,795 |
Cash, cash equivalents, restricted cash and cash equivalents, beginning of period (Note 5) | 2,504,320 | 887,924 |
Cash, cash equivalents, restricted cash and cash equivalents, end of period (Note 5) | $ 2,651,166 | $ 1,915,719 |
Organization and Business Activ
Organization and Business Activities | 6 Months Ended |
Jun. 30, 2020 | |
Organization and Business Activities | |
Organization and Business Activities | 1. Organization and Business Activitie s Principal Business DISH Network Corporation is a holding company. Its subsidiaries (which together with DISH Network Corporation are referred to as “DISH Network,” the “Company,” “we,” “us” and/or “our,” unless otherwise required by the context) operate Pay-TV We offer pay-TV services under the DISH ® brand and the SLING ® brand (collectively “Pay-TV” services). The DISH branded pay-TV service consists of, among other things, FCC licenses authorizing us to use direct broadcast satellite (“DBS”) and Fixed Satellite Service (“FSS”) spectrum, our owned and leased satellites, receiver systems, broadcast operations, customer service facilities, a leased fiber optic network, in-home service and call center operations, and certain other assets utilized in our operations (“DISH TV”). We also design, develop and distribute receiver systems and provide digital broadcast operations, including satellite uplinking/downlinking, transmission and other services to third-party pay-TV providers. The SLING branded pay-TV services consist of, among other things, multichannel, live-linear streaming OTT Internet-based domestic, international and Latino video programming services (“SLING TV”). As of June 30, 2020, we had 11.272 million Pay-TV subscribers in the United States, including 9.017 million DISH TV subscribers and 2.255 million SLING TV subscribers. Recent Developments Sprint Asset Acquisition Asset Purchase Agreement On July 26, 2019, we entered into an Asset Purchase Agreement (the “APA”) with T-Mobile US, Inc. (“TMUS”) and Sprint Corporation (“Sprint” and together with TMUS, the “Sellers” and given the consummation of the Sprint-TMUS merger, sometimes referred to as “NTM”) to acquire from NTM certain assets and liabilities associated with Sprint’s Boost Mobile and Sprint-branded prepaid mobile services businesses (the “Prepaid Business”) for an aggregate purchase price of $1.4 billion as adjusted for specific categories of net working capital on the Closing Date (the “Prepaid Business Sale”). Effective July 1, 2020 (the “Closing Date”), upon the terms and subject to the conditions set forth in the APA and in accordance with the Final Judgment (as defined below), we and NTM completed the Prepaid Business Sale. Our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the quarter ending September 30, 2020 will include the results of the Prepaid Business from the Closing Date forward. Our Condensed Consolidated Balance Sheets for the quarter ending September 30, 2020 will include the assets and liabilities of the Prepaid Business, which will be appraised by a third-party, and will include various assumptions in determining fair value. These assets and liabilities may include intangible assets associated with the MNSA, the Option Agreement, the Spectrum Purchase Agreement, and the TSA, each as further discussed below. Pursuant to certain accounting rules, the purchase price for the acquisition of the Prepaid Business will be adjusted for, among other things, specific categories of net working capital and certain payments from third parties. In connection with the Prepaid Business Sale and the consummation of the Sprint-TMUS merger, we, TMUS, Sprint, Deutsche Telekom AG (“DT”) and SoftBank Group Corporation (“SoftBank”) came to an agreement with the United States Department of Justice (the “DOJ”) on key terms and approval of the Transaction Agreements (as defined below) and our wireless service business and spectrum. On July 26, 2019, we, TMUS, Sprint, DT and SoftBank (collectively, the “Defendants”) entered into a Stipulation and Order (the “Stipulation and Order”) with the DOJ binding the Defendants to a Proposed Final Judgment (the “Proposed Final Judgment”) which memorialized the agreement between the DOJ and the Defendants. The Stipulation and Order and the Proposed Final Judgment were filed in the United States District Court for the District of Columbia (the “District Court”) on July 26, 2019 and on April 1, 2020, the Proposed Final Judgment was entered with the District Court (the Proposed Final Judgment as so entered with the District Court, the “Final Judgment”) and the Sellers consummated the Sprint-TMUS merger. The term of the Final Judgment is seven years from the date of its entry with the District Court or five years if the DOJ gives notice that the divestitures, build- outs and other requirements have been completed to its satisfaction. A Monitoring Trustee has been appointed by the District Court that has the power and authority to monitor the Defendants’ compliance with the Final Judgment and settle disputes among the Defendants regarding compliance with the provisions of the Final Judgment and may recommend action to the DOJ in the event a party fails to comply with the Final Judgment. Also in connection with the closing of the Prepaid Business Sale, we and NTM entered into a transition services agreement under which we will receive certain transitional services (the “TSA”), a master network services agreement for the provision of network services by NTM to us (the “MNSA”), an option agreement entitling us to acquire certain decommissioned cell sites and retail stores of NTM (the “Option Agreement”) and an agreement under which we would purchase all of Sprint’s 800 MHz spectrum licenses, totaling approximately 13.5 MHz of nationwide wireless spectrum for an additional approximately $3.59 billion (the “Spectrum Purchase Agreement” and together with the APA, the TSA, the MNSA and the Option Agreement, the “Transaction Agreements”). See Note 10 for further information on the Transaction Agreements. Agreement with the DOJ: The Stipulation and Order and the Final Judgment Certain of the provisions of the Stipulation and Order and the Final Judgment are also reflected in the terms of the Transaction Agreements. In addition to the terms reflected in the Transaction Agreements, the Stipulation and Order and the Final Judgment provide for other rights and obligations of the Sellers and us, including the following: ● For a period of one year after the Closing Date, if we determine that certain assets not included in the divestiture were previously used by the Prepaid Business and are reasonably necessary for the continued competitiveness of the Prepaid Business, subject to certain carve-outs, we may request that such assets be transferred to us, which the DOJ can approve or deny in its sole discretion. ● Within one year of the Closing Date, we are required to offer nationwide postpaid retail mobile wireless service. ● If we elect not to purchase the 800 MHz licenses pursuant to the Spectrum Purchase Agreement, we must pay $360 million (equal to 10% of the Spectrum Purchase Agreement purchase price) to the United States. However, we will not be required to make such payment if we have deployed a core network and offered 5G service to at least 20% of the U.S. population within three years of the Closing Date. ● If we buy the 800 MHz spectrum pursuant to the Spectrum Purchase Agreement but fail to deploy all of the 800 MHz spectrum licenses for use in the provision of retail mobile wireless services by the expiration of the Final Judgment, the DOJ may require us to forfeit to the FCC any of the 800 MHz licenses for spectrum that are not being used to provide retail mobile wireless services, unless we are already providing nationwide retail wireless service. ● We and NTM must negotiate in good faith to reach an agreement for NTM to lease some or all of our 600 MHz spectrum licenses for deployment to retail consumers by NTM. We and NTM must report on the status of the negotiations within 90 days after the filing of the Final Judgment. If no agreement has been reached by 180 days following the filing of the Final Judgment, the DOJ may resolve any dispute in its sole discretion, provided that such resolution must be on commercially reasonable terms to both parties. Since it has been 180 days since the filing of the Final Judgment, we are waiting a decision from the DOJ. ● We and NTM must agree to support eSIM technology on smartphones. ● The Sellers must introduce the suppliers and distributors of the Prepaid Business to us and the Sellers may not interfere in our negotiations with such suppliers and distributors. ● On the first day of the fiscal quarter following the entry of the Final Judgment and of each 180 -day period thereafter, we will be obligated to provide the DOJ with a description of our deployment efforts over the prior quarter including: (i) the number of towers and small cells deployed, (ii) the spectrum bands on which we have deployed equipment, (iii) progress in obtaining devices that operate on our spectrum frequencies, (iv) POPs coverage of our network, (v) the number of our mobile wireless subscriptions, (vi) the amount of traffic transmitted to our subscribers using our network and using NTM’s network, and (vii) whether there are or have been any efforts by NTM to interfere with our efforts to deploy and operate our network. ● We cannot sell, lease or otherwise provide the right to use any of the divested assets to any national facilities-based mobile wireless provider and may not sell any of the divested assets or similar assets back to TMUS during the term of the Final Judgment, except that we may lease back to NTM up to 4 MHz of the 800 MHz spectrum we will acquire (as discussed above). ● We must comply with the June 14, 2023 AWS-4, Lower 700 MHz E Block, AWS H Block, and nationwide 5G broadband network build- out commitments made to the FCC, subject to verification by the FCC (as described below). If we fail to comply with such build-out commitments, we may be subject to civil contempt in addition to the substantial voluntary contributions and license forfeitures described below if we fail to meet these commitments (as described below). FCC Build-Out Commitments In a letter filed with the FCC on July 26, 2019, we voluntarily committed to deploy a nationwide 5G broadband network and meet revised timelines relating to the build-out of our AWS-4, Lower 700 MHz E Block, AWS H Block and 600 MHz spectrum assets, subject to certain penalties. Pursuant to these commitments, we requested multi-year extensions to deploy our AWS-4, Lower 700 MHz E Block, and AWS H Block spectrum, and we have committed to build-out our 600 MHz licenses on an accelerated schedule to better align with our 5G deployment. We have also committed to offer 5G broadband service to certain population coverage targets, along with minimum core network, tower and spectrum use targets, and have waived our right to deploy any technology of our choice under the FCC’s “flexible use” rules with respect to these spectrum bands. Failure to meet the various commitments would require us to pay voluntary contributions totaling up to $2.2 billion to the FCC and would subject certain licenses in the AWS-4, Lower 700 MHz E Block, and AWS H Block spectrum to forfeiture. We have also agreed not to sell our AWS-4 and 600 MHz spectrum for six years without prior DOJ and FCC approval (unless such sale is part of a change of control of DISH Network). Additionally, we have agreed not to lease a certain percentage of network capacity on our AWS-4 and 600 MHz spectrum for six years to the three largest U.S. wireless carriers (i.e., AT&T, Verizon and NTM), without prior FCC approval. On November 5, 2019, the FCC released an Order that, among other things, approved the Sprint-TMUS merger, tolled our existing March 7, 2020 build-out deadline for our AWS-4 and Lower 700 MHz E Block Licenses, and directed the FCC’s Wireless Telecommunications Bureau to adopt our commitments after a 30 day review period (the “FCC Merger Order”). Upon the FCC issuing its Order effectuating these commitments, our 5G deployment commitments for each of the four spectrum bands will be generally as set forth below. We cannot predict with any degree of certainty the timing of the FCC issuing its Order effectuating these commitments. ● With respect to the 600 MHz licenses, we committed to offer 5G broadband service to at least 70% of the U.S. population and to have deployed a core network no later than June 14, 2023, and to offer 5G broadband service to at least 75% of the population in each Partial Economic Area (which are service areas established by the FCC) no later than June 14, 2025. Note that these commitments are earlier than the current 600 MHz Final Build-Out Requirement date of June 2029. See Note 10 for further information. ● With respect to the AWS-4 licenses, we committed to offer 5G broadband service to at least 20% of the U.S. population and to have deployed a core network no later than June 14, 2022, and to offer 5G broadband service to at least 70% of the U.S. population no later than June 14, 2023. ● With respect to the Lower 700 MHz E Block licenses, we committed to offer 5G broadband service to at least 20% of the U.S. population who are covered by such licenses and to have deployed a core network no later than June 14, 2022, and to offer 5G broadband service to at least 70% of the U.S. population who are covered by such licenses no later than June 14, 2023. ● With respect to the AWS H Block licenses, we committed to offer 5G broadband service to at least 20% of the U.S. population and to have deployed a core network no later than June 14, 2022, and to offer 5G broadband service to at least 70% of the U.S. population no later than June 14, 2023. Wireless Since 2008, we have directly invested over $11 billion to acquire certain wireless spectrum licenses and related assets and made over $10 billion in non-controlling investments in certain entities, for a total of over $21 billion. The capitalized interest DISH Network Spectrum We have directly invested over $11 billion to acquire certain wireless spectrum licenses and related assets. These wireless spectrum licenses are subject to certain interim and final build-out requirements, as well as certain renewal requirements . In March 2017, we notified the FCC that we planned to deploy a narrowband IoT network on certain of these wireless licenses, which was to be the first phase of our network deployment (“First Phase”). We expected to complete the First Phase by March 2020, with subsequent phases to be completed thereafter. In light of, among other things, certain developments related to the Sprint-TMUS merger, during the first quarter 2020, we determined that the revision of certain of our build-out deadlines was probable and, therefore, we no longer intended to complete our narrowband IoT deployment. As a result, during the first quarter 2020, we impaired certain assets that w ould not be utilized in our 5G broadband network deployment (“5G Network Deployment”), resulting in a $253 million non-cash impairment charge in “Impairment of long-lived assets” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) . We have issued RFI/Ps to various vendors in the wireless industry as we move forward with our 5G Network Deployment. We currently expect expenditures for our wireless projects to be between $250 million and $500 million during 2020, excluding capitalized interest. We currently expect expenditures for our 5G Network Deployment to be approximately $10 billion, excluding capitalized interest. We will need to make significant additional investments or partner with others to, among other things, commercialize, build-out, and integrate these licenses and related assets, and any additional acquired licenses and related assets; and comply with regulations applicable to such licenses. Depending on the nature and scope of such commercialization, build-out, integration efforts, and regulatory compliance, any such investments or partnerships could vary significantly. In addition, as we consider our options for the commercialization of our wireless spectrum, we will incur significant additional expenses and will have to make significant investments related to, among other things, research and development, wireless testing and wireless network infrastructure. We may also determine that additional wireless spectrum licenses may be required to commercialize our wireless business and to compete with other wireless service providers. See Note 2 and Note 10 for further information. DISH Network Non-Controlling Investments in the Northstar Entities and the SNR Entities Related to AWS-3 Wireless Spectrum Licenses During 2015, through our wholly-owned subsidiaries American AWS-3 Wireless II L.L.C. (“American II”) and American AWS-3 Wireless III L.L.C. (“American III”), we initially made over $10 billion in certain non-controlling investments in Northstar Spectrum, LLC (“Northstar Spectrum”), the parent company of Northstar Wireless, L.L.C. (“Northstar Wireless,” and collectively with Northstar Spectrum, the “Northstar Entities”), and in SNR Wireless HoldCo, LLC (“SNR HoldCo”), the parent company of SNR Wireless LicenseCo, LLC (“SNR Wireless,” and collectively with SNR HoldCo, the “SNR Entities”), respectively. On October 27, 2015, the FCC granted certain AWS-3 wireless spectrum licenses (the “AWS-3 Licenses”) to Northstar Wireless and to SNR Wireless, respectively, which are recorded in “FCC authorizations” on our Condensed Consolidated Balance Sheets. Under the applicable accounting guidance in Accounting Standards Codification 810, Consolidation (“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 consolidate these entities into our financial statements. See Note 2 for further information. The AWS-3 Licenses are subject to certain interim and final build-out requirements, as well as certain renewal requirements . The Northstar Entities and/or the SNR Entities may need to raise significant additional capital in the future, which may be obtained from third party sources or from us, so that the Northstar Entities and the SNR Entities may commercialize, build-out and integrate these AWS-3 Licenses, comply with regulations applicable to such AWS-3 Licenses, and make any potential Northstar Re-Auction Payment and SNR Re-Auction Payment for the AWS-3 licenses retained by the FCC. Depending upon the nature and scope of such commercialization, build-out, integration efforts, regulatory compliance, and potential Northstar Re-Auction Payment and SNR Re-Auction Payment, any loans, equity contributions or partnerships could vary significantly. There can be no assurance that we will be able to obtain a profitable return on our non-controlling investments in the Northstar Entities and the SNR Entities. See Note 10 for further information. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2020 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and with the instructions to Form 10-Q and Article 10 of Regulation S-X for interim financial information. Accordingly, these statements do not include all of the information and notes required for complete financial statements prepared under GAAP. In our opinion, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Our results of operations for the interim periods presented are not necessarily indicative of the results that may be expected for the full year. For further information, refer to the Consolidated Financial Statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019. Certain prior period amounts have been reclassified to conform to the current period presentation. Principles of Consolidation We consolidate all majority owned subsidiaries, investments in entities in which we have controlling influence and variable interest entities where we have been determined to be the primary beneficiary. Minority interests are recorded as noncontrolling interests or redeemable noncontrolling interests. See below for further information. Non-consolidated investments are accounted for using the equity method when we have the ability to significantly influence the operating decisions of the investee. When we do not have the ability to significantly influence the operating decisions of an investee, these equity securities are classified as either marketable investment securities or other investments and recorded at fair value with changes recognized in “Other, net” within “Other Income (Expense)” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). All significant intercompany accounts and transactions have been eliminated in consolidation. Redeemable Noncontrolling Interests Northstar Wireless . Northstar Wireless is a wholly-owned subsidiary of Northstar Spectrum, which is an entity owned by Northstar Manager, LLC (“Northstar Manager”) and us. Under the applicable accounting guidance in ASC 810, Northstar Spectrum is considered a variable interest entity and, based on the characteristics of the structure of this entity and in accordance with the applicable accounting guidance, we consolidate Northstar Spectrum into our financial statements. The Northstar Operative Agreements, as amended, provide for, among other things, that after the fifth and sixth anniversaries of the grant of the AWS-3 Licenses to Northstar Wireless (and in certain circumstances, prior to the fifth anniversary of the grant of the AWS-3 Licenses to Northstar Wireless), Northstar Manager has the ability, but not the obligation, to require Northstar Spectrum to purchase Northstar Manager’s ownership interests in Northstar Spectrum (the “Northstar Put Right”) for a purchase price that equals its equity contribution to Northstar Spectrum plus a fixed annual rate of return. The fifth and sixth anniversaries of the grant of the AWS-3 Licenses to Northstar Wireless are in the fourth quarter 2020 and fourth quarter 2021, respectively. In the event that the Northstar Put Right is exercised by Northstar Manager, the consummation of the sale will be subject to FCC approval. Northstar Spectrum does not have a call right with respect to Northstar Manager’s ownership interests in Northstar Spectrum. Although Northstar Manager is the sole manager of Northstar Spectrum, Northstar Manager’s ownership interest is considered temporary equity under the applicable accounting guidance and is thus recorded as part of “Redeemable noncontrolling interests” in the mezzanine section of our Condensed Consolidated Balance Sheets. Northstar Manager’s ownership interest in Northstar Spectrum was initially accounted for at fair value. Subsequently, Northstar Manager’s ownership interest in Northstar Spectrum is increased by the fixed annual rate of return through “Redeemable noncontrolling interests” on our Condensed Consolidated Balance Sheets, with the offset recorded in “Net income (loss) attributable to noncontrolling interests, net of tax” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The operating results of Northstar Spectrum attributable to Northstar Manager are recorded as “Redeemable noncontrolling interests” on our Condensed Consolidated Balance Sheets, with the offset recorded in “Net income (loss) attributable to noncontrolling interests, net of tax” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 10 for further information. SNR Wireless . SNR Wireless is a wholly-owned subsidiary of SNR HoldCo, which is an entity owned by SNR Wireless Management, LLC (“SNR Management”) and us. Under the applicable accounting guidance in ASC 810, SNR HoldCo is considered a variable interest entity and, based on the characteristics of the structure of this entity and in accordance with the applicable accounting guidance, we consolidate SNR HoldCo into our financial statements. The SNR Operative Agreements, as amended, provide for, among other things, that after the fifth sixth anniversaries of the grant of the AWS-3 Licenses to SNR Wireless (and in certain circumstances, prior to the fifth anniversary of the grant of the AWS-3 Licenses to SNR Wireless), SNR Management has the ability, but not the obligation, to require SNR HoldCo to purchase SNR Management’s ownership interests in SNR HoldCo (the “SNR Put Right”) for a purchase price that equals its equity contribution to SNR HoldCo plus a fixed annual rate of return. The fifth and sixth anniversaries of the grant of the AWS-3 Licenses to SNR Wireless are in the fourth quarter 2020 and fourth quarter 2021, respectively. In the event that the SNR Put Right is exercised by SNR Management, the consummation of the sale will be subject to FCC approval. SNR HoldCo does not have a call right with respect to SNR Management’s ownership interests in SNR HoldCo. Although SNR Management is the sole manager of SNR HoldCo, SNR Management’s ownership interest is considered temporary equity under the applicable accounting guidance and is thus recorded as part of “Redeemable noncontrolling interests” in the mezzanine section of our Condensed Consolidated Balance Sheets. SNR Management’s ownership interest in SNR HoldCo was initially accounted for at fair value. Subsequently, SNR Management’s ownership interest in SNR HoldCo is increased by the fixed annual rate of return through “Redeemable noncontrolling interests” on our Condensed Consolidated Balance Sheets, with the offset recorded in “Net income (loss) attributable to noncontrolling interests, net of tax” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The operating results of SNR HoldCo attributable to SNR Management are recorded as “Redeemable noncontrolling interests” on our Condensed Consolidated Balance Sheets, with the offset recorded in “Net income (loss) attributable to noncontrolling interests, net of tax” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 10 for further information. As of June 30, 2020 and December 31, 2019, Northstar Manager’s ownership interest in Northstar Spectrum Use of Estimates The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense for each reporting period. Estimates are used in accounting for, among other things, allowances for credit losses, self-insurance obligations, deferred taxes and related valuation allowances, uncertain tax positions, loss contingencies, fair value of financial instruments, fair value of options granted under our stock-based compensation plans, fair value of assets and liabilities acquired in business combinations, relative standalone selling prices of performance obligations, finance leases, asset impairments, estimates of future cash flows used to evaluate and recognize impairments, useful lives of property, equipment and intangible assets, independent third-party retailer incentives, programming expenses and subscriber lives. Economic conditions may increase the inherent uncertainty in the estimates and assumptions indicated above. Actual results may differ from previously estimated amounts, and such differences may be material to our condensed consolidated financial statements. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected prospectively in the period they occur. Marketable Investment Securities All equity securities are carried at fair value, with changes in fair value recognized in “Other, net” within “Other Income (Expense)” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). All debt securities are classified as available-for-sale and are recorded at fair value. Historically, we reported temporary unrealized gains and losses as a separate component of “Accumulated other comprehensive income (loss)” within “Total stockholders’ equity (deficit),” net of related deferred income tax on our Condensed Consolidated Balance Sheets. Subsequent to the adoption of ASU 2016-13 Financial Instruments – Credit Losses, Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”) during the first quarter of 2020, we report the temporary unrealized gains and losses related to changes in market conditions of marketable debt securities as a separate component of “Accumulated other comprehensive income (loss)” within “Total stockholders’ equity (deficit),” net of related deferred income tax on our Condensed Consolidated Balance Sheets. The corresponding changes in the fair value of marketable debt securities, which are determined to be company specific credit losses are recorded in “Other, net” within “Other Income (Expense)” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). We evaluate our debt investment portfolio to determine whether declines in the fair value of these securities are related to credit loss. Management estimates credit losses on marketable debt securities utilizing a credit loss impairment model on a quarterly basis. We estimate the expected credit losses, measured over the contractual life of marketable debt securities considering relevant issuer specific factors, including, but not limited to, a decrease in credit ratings or an entities ability to pay. Trade Accounts Receivable Prior to January 1, 2020, management estimated the amount of allowance for doubtful accounts for potential non-collectability of accounts receivable based upon past collection experience and consideration of other relevant factors. Subsequent to January 1, 2020 due to the adoption of ASU 2016-13, trade accounts receivable are recorded at amortized cost less an allowance for expected credit losses that are not expected to be recovered. We maintain allowances for credit losses resulting from the expected failure or inability of our customers to make required payments. We recognize the allowance for expected credit losses at inception and reassess quarterly based on management’s expectation of the asset’s collectability. Management estimates credit losses on financial assets, including our trade accounts receivable, utilizing a current expected credit loss impairment model. We estimate the expected credit losses, measured over the contractual life of an asset considering relevant historical loss information, credit quality of the customer base, current economic conditions and forecasts of future economic conditions. In determining the allowance for credit losses, management groups similar types of financial assets with consistent risk characteristics. Pools identified by management include but are not limited to residential customers, commercial customers and advertising services. The risk characteristics of the financial asset portfolios are monitored by management and reviewed periodically. The forecasts for future economic conditions are based on several factors including, but not limited to, changes in the unemployment rate, external economic forecasts and current collection rates. Our estimates of the allowance for credit losses may not be indicative of our actual credit losses requiring additional charges to be incurred to reflect the actual amount collected. Impairment of Long-Lived Assets We review our long-lived assets and identifiable finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. For assets which are held and used in operations, the asset would be impaired if the carrying amount of the asset (or asset group) exceeded its undiscounted future net cash flows. Once an impairment is determined, the actual impairment recognized is the difference between the carrying amount and the fair value as estimated using one of the following approaches: income, cost and/or market. Assets which are to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. The carrying amount of a long-lived asset or asset group is considered impaired when the anticipated undiscounted cash flows from such asset or asset group is less than its carrying amount. In that event, a loss is recorded in “Impairment of long-lived assets” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) based on the amount by which the carrying amount exceeds the fair value of the long-lived asset or asset group. Fair value, using the income approach, is determined primarily using a discounted cash flow model that uses the estimated cash flows associated with the asset or asset group under review, discounted at a rate commensurate with the risk involved. Fair value, utilizing the cost approach, is determined based on the replacement cost of the asset reduced for, among other things, depreciation and obsolescence. Fair value, utilizing the market approach, benchmarks the fair value against the carrying amount. See Note 7 for further information. DBS Satellites . We currently evaluate our DBS satellite fleet for impairment as one asset group whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. We do not believe any triggering event has occurred which would indicate impairment as of June 30, 2020 or December 31, 2019. We will continue to monitor the DBS satellite fleet for indicators of impairment, including monitoring the impact of the COVID-19 pandemic on all aspects of our business. AWS-4 Satellites. We currently evaluate our AWS-4 satellite fleet for impairment whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. In light of, among other things, certain developments related to the Sprint-TMUS merger, during the first quarter 2020, we determined that revisions to the AWS-4 build-out deadlines were probable, which we determined to be a triggering event. Accordingly, we quantitatively assessed the value of the AWS-4 satellites (T1 and D1) and wrote down the fair value of the satellites to their estimated fair value of million non-cash impairment charge in “Impairment of long-lived assets” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). We did not believe any triggering event occurred which would indicate impairment as of December 31, 2019. See Note 7 for further information. Narrowband IoT network. As discussed in Note 10, we were in the process of deploying a narrowband IoT network. We paused work on the narrowband IoT deployment in October 2019. In light of, among other things, certain developments related to the Sprint-TMUS merger, during the first quarter 2020, we determined that the revision of certain of our build-out deadlines were probable. Based on this, we no longer intended to complete our narrowband IoT deployment, which we considered a triggering event. As such, during the first quarter 2020, we reviewed the capitalized costs of equipment, labor and other assets related to the narrowband IoT deployment, including our operating lease assets, and impaired those items that would not be utilized in our ongoing 5G Network Deployment, resulting in a million non-cash impairment charge in “Impairment of long-lived assets” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 7 and Note 8 for further information. Impairment of long-lived assets recorded during the first quarter 2020 consisted of the following: For the Six Months Ended June 30, 2020 (In thousands) T1 satellite $ 48,120 D1 satellite 55,000 Construction in progress related to narrowband IoT deployment 226,742 Operating lease assets related to narrowband IoT deployment 26,556 Impairment of long-lived assets $ 356,418 Capitalized Interest We capitalize interest associated with the acquisition or construction of certain assets, including, among other things, our wireless spectrum licenses, build-out costs associated with our network deployment and satellites. Capitalization of interest begins when, among other things, steps are taken to prepare the asset for its intended use and ceases when the asset is ready for its intended use or when these activities are substantially suspended. We are currently preparing for the commercialization of our AWS-4, H Block, 700 MHz, 600 MHz and MVDDS wireless spectrum licenses, and interest expense related to their carrying amount is being capitalized. In addition, the FCC has granted certain AWS-3 Licenses to Northstar Wireless and to SNR Wireless, respectively, in which we have made certain non-controlling investments. Northstar Wireless and SNR Wireless are preparing for the commercialization of their AWS-3 Licenses and interest expense related to their carrying amount is also being capitalized. As the carrying amount of the licenses, discussed above, exceeded the carrying value of our long-term debt and finance lease obligations, materially all of our interest expense is being capitalized. Fair Value Measurements We determine fair value based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. Market or observable inputs are the preferred source of values, followed by unobservable inputs or assumptions based on hypothetical transactions in the absence of market inputs. We apply the following hierarchy in determining fair value: ● Level 1, defined as observable inputs being quoted prices in active markets for identical assets; ● Level 2, defined as observable inputs other than quoted prices included in Level 1, including quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar instruments in markets that are not active; and derivative financial instruments indexed to marketable investment securities; and ● Level 3, defined as unobservable inputs for which little or no market data exists, consistent with reasonably available assumptions made by other participants therefore requiring assumptions based on the best information available. As of June 30, 2020 and December 31, 2019, the carrying amount for cash and cash equivalents, trade accounts receivable (net of allowance for credit losses or net of allowance for doubtful accounts) and current liabilities (excluding the “Current portion of long-term debt and finance lease obligations”) was equal to or approximated fair value due to their short-term nature or proximity to current market rates. See Note 5 for the fair value of our marketable investment securities and derivative financial instruments. Fair values for our publicly traded debt securities are based on quoted market prices, when available. The fair values of private debt are based on, among other things, available trade information, and/or an analysis in which we evaluate market conditions, related securities, various public and private offerings, and other publicly available information. In performing this analysis, we make various assumptions regarding, among other things, credit spreads, and the impact of these factors on the value of the debt securities. See Note 9 for the fair value of our long-term debt. Revenue Recognition Our revenue is primarily derived from Pay-TV programming services that we provide to our subscribers. We also generate revenue from equipment rental fees and other hardware related fees, including DVRs and fees from subscribers with multiple receivers; advertising services; fees earned from our in-home service operations; broadband services; warranty services; sales of digital receivers and related equipment to third-party pay-TV providers; satellite uplink and telemetry, tracking and control (“TT&C”) services; and revenue from in-home services. See Note 11 Our residential video subscribers contract for individual services or combinations of services, as discussed above, the majority of which are generally distinct and are accounted for as separate performance obligations. We consider our installations for first time DISH TV subscribers to be a service. However, since we provide a significant integration service combining the installation with programming services, we have concluded that the installation is not distinct from programming and thus the installation and programming services are accounted for as a single performance obligation. We generally satisfy these performance obligations and recognize revenue as the services are provided, for example as the programming is broadcast to subscribers, as this best represents the transfer of control of the services to the subscriber. In cases where a subscriber is charged certain nonrefundable upfront fees, those fees are generally considered to be material rights to the subscriber related to the subscriber’s option to renew without having to pay an additional fee upon renewal. These fees are deferred and recognized over the estimated period of time during which the fee remains material to the customer, which we estimate to be less than one year. Revenues arising from our in-home services that are separate from the initial installation, such as mounting a TV on a subscriber’s wall, are generally recognized when these services are performed. For our residential video subscribers, we have concluded that the contract term under Accounting Standard Codification Topic 606, Revenue from Contracts with Customers is one month and as a result the revenue recognized for these subscribers for a given month is equal to the amount billed in that month, except for certain nonrefundable upfront fees that are accounted for as material rights, as discussed above. Revenues from our advertising services are typically recognized as the advertisements are broadcast. Sales of equipment to subscribers or other third parties are recognized when control is transferred under the contract. Revenue from our commercial video subscribers typically follows the residential model described above, with the exception that the contract term for most of our commercial subscribers exceeds one month and can be multiple years in length. However, commercial subscribers typically do not receive time-limited discounts or free service periods and accordingly, while they may have multiple performance obligations, revenue is equal to the amount billed in a given month. Contract Balances The timing of revenue recognition generally differs from the timing of invoicing to customers. When revenue is recognized prior to invoicing, we record a receivable. When revenue is recognized subsequent to invoicing, we record deferred revenue. Our residential video subscribers are typically billed monthly, and the contract balances for those customers arise from the timing of the monthly billing cycle. We do not adjust the amount of consideration for financing impacts as we apply a practical expedient when we anticipate that the period between transfer of goods and services and eventual payment for those goods and services will be less than year. See Note 12 for further information, including balance and activity detail about our allowance for credit losses and deferred revenue related to contracts with subscribers. Assets Recognized Related to the Costs to Obtain a Contract with a Subscriber We recognize an asset for the incremental costs of obtaining a contract with a subscriber if we expect the benefit of those costs to be longer than one year. We have determined that certain sales incentive programs, including those with our independent third-party retailers, meet the requirements to be capitalized, and payments made under these programs are capitalized and amortized to expense over the estimated subscriber life. During the three months ended June 30, 2020 and 2019, we capitalized $44 million and $55 million, respectively, under these programs. The amortization expense related to these programs was $29 million and $17 million for the three months ended June 30, 2020 and 2019, respectively. During the six months ended June 30, 2020 and 2019, we capitalized million, respectively, under these programs. The amortization expense related to these programs was Leases We enter into operating and finance leases for, among other things, satellites, office space, warehouses and distribution centers, vehicles, wireless towers and other equipment. Our leases have remaining lease terms from one some renewal options options terminate within We determine if an arrangement is a lease and classify that lease as either an operating or finance lease at inception. Operating leases are included in “Operating lease assets,” “Other accrued expenses” and “Operating lease liabilities” on our Condensed Consolidated Balance Sheets. Finance leases are included in “Property and equipment, net,” “Current portion of long-term debt and finance lease obligations” and “Long-term debt and finance lease obligations, net of current portion” on our Condensed Consolidated Balance Sheets. Leases with an initial term of 12 months or less are not recorded on the balance sheet and we recognize lease expense for these leases on a straight-line basis over the lease term on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 8 for further information on our lease expenses. Right of use (“ROU”) assets represent our right to use an underlying asset for the lease term and lease liabilities represent the present value of our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. When our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The operating lease ROU asset also includes the impact of prepaid or deferred lease payments. The length of our lease term may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term. We currently lease and historically have leased certain assets from EchoStar, including, among other things, satellites, office space and data centers. See Note 13 for further information on our Related Party Transactions with EchoStar. On May 19, 2019, we entered into a Master Transaction Agreement with EchoStar and effective September 10, 2019, certain satellites and real estate assets leased from EchoStar were transferred to us. See Note 13 for further information on the Master Transaction Agreement. We have lease agreements with lease and non-lease components, which are generally accounted for separately. Our variable lease payments are immaterial and our lease agreements do not contain any material residual value guarantees or material restrictive covenants. DISH TV subscribers have the choice of leasing or purchasing the satellite receiver and other equipment necessary to receive our DISH TV services. Most of our new DISH TV subscribers choose to lease equipment and thus we retain title to such equipment. Equipment leased to new and existing DISH TV subscribers is capitalized and depreciated over their estimated useful lives. For equipment leased to new and existing DISH TV subscribers, we made an accounting policy election to combine the equipment with our programming services as a single performance obligation in accordance with the revenue recognition guidance as the programming services are the predominant component. The revenue related to equipment leased to new and existing DISH TV subscribers would have otherwise been accounted for as an operating lease. Impact of Adoption of ASU 2016-02 In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-02 Leases (“ASU 2016-02”) and has modified the standard thereafter. We adopted ASU 2016-02, as modified, on January 1, 2019 using the modified retrospective method. Under the modified retrospective method, we applied the new guidance to all leases that commenced before and were existing as of January 1, 2019. The adoption of ASU 2016-02 had no impact on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) and cash flows from operating, investing and financing activities on our Condensed Consolidated Statements of Cash Flows. Research and Development Research and development costs are expensed as incurred. Research and development costs totaled $ 5 million for the three months ended June 30, 2020 and 2019, respectively. Research and development costs totaled $11 million for each of the six months ended June 30, 2020 and 2019. |
Basic and Diluted Net Income (L
Basic and Diluted Net Income (Loss) Per Share | 6 Months Ended |
Jun. 30, 2020 | |
Basic and Diluted Net Income (Loss) Per Share | |
Basic and Diluted Net Income (Loss) Per Share | 3. Basic and Diluted Net Income (Loss) Per Share We present both basic earnings per share (“EPS”) and diluted EPS. Basic EPS excludes potential dilution and is computed by dividing “Net income (loss) attributable to DISH Network” by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if stock awards were exercised and if our Convertible Notes were converted. The potential dilution from stock awards is accounted for using the treasury stock method based on the average market value of our Class A common stock. The potential dilution from conversion of the Convertible Notes is accounted for using the if-converted method, which requires that all of the shares of our Class A common stock issuable upon conversion of the Convertible Notes will be included in the calculation of diluted EPS assuming conversion of the Convertible Notes at the beginning of the reporting period (or at time of issuance, if later). The following table presents EPS amounts for all periods and the basic and diluted weighted-average shares outstanding used in the calculation. For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 (In thousands, except per share amounts) Net income (loss) $ 480,406 $ 340,566 $ 579,680 $ 701,865 Less: Net income (loss) attributable to noncontrolling interests, net of tax 28,063 23,523 54,238 45,061 Net income (loss) attributable to DISH Network - Basic 452,343 317,043 525,442 656,804 Interest on dilutive Convertible Notes, net of tax (1) — — — — Net income (loss) attributable to DISH Network - Diluted $ 452,343 $ 317,043 $ 525,442 $ 656,804 Weighted-average common shares outstanding - Class A and B common stock: Basic (2) 524,292 469,655 523,722 468,809 Dilutive impact of Convertible Notes 58,192 58,192 58,192 58,192 Dilutive impact of stock awards outstanding 135 136 157 106 Diluted 582,619 527,983 582,071 527,107 Earnings per share - Class A and B common stock: Basic net income (loss) per share attributable to DISH Network $ 0.86 $ 0.68 $ 1.00 $ 1.40 Diluted net income (loss) per share attributable to DISH Network $ 0.78 $ 0.60 $ 0.90 $ 1.25 (1) For both the three and six months ended June 30, 2020 and 2019 , materially all of our interest expense was capitalized. See Note 2 for further information. (2) The increase resulted from the Master Transaction Agreement, as discussed in Note 13, and the stock rights offering as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2019. Certain stock awards to acquire our Class A common stock are not included in the weighted-average common shares outstanding above, as their effect is anti-dilutive. In addition, vesting of performance based options and rights to acquire shares of our Class A common stock granted pursuant to our performance based stock incentive plans (“Restricted Performance Units”) are both contingent upon meeting certain goals, some of which are not yet probable of being achieved. Furthermore, the warrants that we issued to certain option counterparties in connection with the Convertible Notes due 2026 are only exercisable at their expiration if the market price per share of our Class A common stock is greater than the strike price of the warrants, which is approximately per share, subject to adjustments. As a consequence, the following are not included in the diluted EPS calculation. As of June 30, 2020 2019 (In thousands) Anti-dilutive stock awards 6,570 5,115 Performance based options (1) 6,618 8,582 Restricted Performance Units/Awards (1) 1,146 1,589 Common stock warrants 46,029 46,029 Total 60,363 61,315 (1) The decrease primarily resulted from certain performance based options and Restricted Performance Units/Awards that vested during the three months ended June 30, 2020. |
Supplemental Data - Statements
Supplemental Data - Statements of Cash Flows | 6 Months Ended |
Jun. 30, 2020 | |
Supplemental Data - Statements of Cash Flows | |
Supplemental Data - Statements of Cash Flows | 4. Supplemental Data - Statements of Cash Flows The following table presents certain supplemental cash flow and other non-cash data. See Note 8 for supplemental cash flow and non-cash data related to leases. For the Six Months Ended June 30, 2020 2019 (In thousands) Cash paid for interest (including capitalized interest) $ 404,158 $ 445,713 Cash received for interest 5,153 12,962 Cash paid for income taxes 4,294 18,350 Capitalized interest (1) 451,026 500,222 Employee benefits paid in Class A common stock 28,301 27,004 Reclassification of a receivable from noncurrent to current — 140,810 Tax impact of the CARES Act 97,256 — (1) See Note 2 for further information. |
Marketable Investment Securitie
Marketable Investment Securities, Restricted Cash and Cash Equivalents, and Other Investment Securities | 6 Months Ended |
Jun. 30, 2020 | |
Marketable Investment Securities, Restricted Cash and Cash Equivalents, and Other Investment Securities | |
Marketable Investment Securities, Restricted Cash and Cash Equivalents, and Other Investment Securities | 5. Marketable Investment Securities, Restricted Cash and Cash Equivalents, and Other Investment Securities Our marketable investment securities, restricted cash and cash equivalents, and other investment securities consisted of the following: As of June 30, December 31, 2020 2019 (In thousands) Marketable investment securities: Current marketable investment securities: Strategic - available-for-sale $ 189 $ 196 Other 40,013 416,508 Total current marketable investment securities 40,202 416,704 Restricted marketable investment securities (1) — 390 Total marketable investment securities 40,202 417,094 Restricted cash and cash equivalents (1) 61,349 60,677 Other investment securities: Other investment securities 147,863 160,074 Total other investment securities 147,863 160,074 Total marketable investment securities, restricted cash and cash equivalents, and other investment securities $ 249,414 $ 637,845 (1) Restricted marketable investment securities and restricted cash and cash equivalents are included in “Restricted cash, cash equivalents and marketable investment securities” on our Condensed Consolidated Balance Sheets. Marketable Investment Securities Our marketable investment securities portfolio may consist of debt and equity instruments. All equity securities are carried at fair value, with changes in fair value recognized in “Other, net” within “Other Income (Expense)” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). All debt securities are classified as available-for-sale and are recorded at fair value. We report the temporary unrealized gains and losses related to changes in market conditions of marketable debt securities as a separate component of “Accumulated other comprehensive income (loss)” within “Total stockholders’ equity (deficit),” net of related deferred income tax on our Condensed Consolidated Balance Sheets. The corresponding changes in the fair value of marketable debt securities, which are determined to be company specific credit losses are recorded in “Other, net” within “Other Income (Expense)” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 2 for further information. Current Marketable Investment Securities Strategic Our current strategic marketable investment securities portfolio includes and may include strategic and financial debt and/or equity investments in private and public companies that are highly speculative and have experienced and continue to experience volatility. As of , this portfolio consisted of securities of a small number of issuers, and as a result the value of that portfolio depends, among other things, on the performance of those issuers. The fair value of certain of the debt and equity securities in this portfolio can be adversely impacted by, among other things, the issuers’ respective performance and ability to obtain any necessary additional financing on acceptable terms, or at all. Current Marketable Investment Securities - Other Our current other marketable investment securities portfolio includes investments in various debt instruments including, among others, commercial paper, corporate securities and United States treasury and/or agency securities. Commercial paper consists mainly of unsecured short-term, promissory notes issued primarily by corporations with maturities ranging up to 365 days . Corporate securities consist of debt instruments issued by corporations with various maturities normally less than 18 months . U.S. Treasury and agency securities consist of debt instruments issued by the federal government and other government agencies. Restricted Cash, Cash Equivalents and Marketable Investment Securities As of June 30, 2020 and December 31, 2019, our restricted marketable investment securities, together with our restricted cash and cash equivalents, included amounts required as collateral for our letters of credit and trusts. Other Investment Securities We have strategic investments in certain debt and/or equity securities that are included in noncurrent “Other investment securities” on our Condensed Consolidated Balance Sheets. Our debt securities are classified as available-for-sale and our equity securities are accounted for using the equity method of accounting or recorded at fair value. Certain of our equity method investments are detailed below. NagraStar L.L.C. As a result of the completion of the share exchange on February 28, 2017, we own a 50 % interest in NagraStar L.L.C. (“NagraStar”), a joint venture that is our primary provider of encryption and related security systems intended to assure that only authorized customers have access to our programming. Invidi Technologies Corporation . In November 2016, we, DIRECTV, LLC, a wholly-owned indirect subsidiary of AT&T Inc., and Cavendish Square Holding B.V., an affiliate of WPP plc, entered into a series of agreements to acquire Invidi Technologies Corporation (“Invidi”), an entity that provides proprietary software for the addressable advertising market. The transaction closed in January 2017. TerreStar Solutions, Inc. Our ability to realize value from our strategic investments in securities that are not publicly traded depends on the success of the issuers’ businesses and their ability to obtain sufficient capital, on acceptable terms or at all, and to execute their business plans. Because private markets are not as liquid as public markets, there is also increased risk that we will not be able to sell these investments, or that when we desire to sell them we will not be able to obtain fair value for them. Unrealized Gains (Losses) on Marketable Investment Securities As of June 30, 2020 and December 31, 2019, we had zero accumulated net unrealized gains and/or losses and accumulated net unrealized gains of less than $1 million, respectively. These amounts, net of related tax effect, were zero accumulated net unrealized gains and/or losses and accumulated net unrealized gains of less than $1 million, respectively. All of these amounts are included in “Accumulated other comprehensive income (loss)” within “Total stockholders’ equity (deficit).” The components of our available-for-sale investments are summarized in the table below. As of June 30, As of December 31, 2020 2019 Marketable Marketable Investment Unrealized Investment Unrealized Securities Gains Losses Net Securities Gains Losses Net (In thousands) Debt securities (including restricted): U.S. Treasury and agency securities $ — $ — $ — $ — $ 10,016 $ 32 $ — $ 32 Commercial paper 40,000 — — — 369,397 2 — 2 Corporate securities — — — — 28,796 4 (1) 3 Other 202 — — — 8,885 58 — 58 Total $ 40,202 $ — $ — $ — $ 417,094 $ 96 $ (1) $ 95 As of June 30, 2020, restricted and non-restricted marketable investment securities included debt securities of $40 million with contractual maturities within one year. Actual maturities may differ from contractual maturities as a result of our ability to sell these securities prior to maturity. Fair Value Measurements Our investments measured at fair value on a recurring basis were as follows: As of June 30, 2020 December 31, 2019 Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 (In thousands) Cash equivalents (including restricted) $ 2,604,019 $ 1,833,706 $ 770,313 $ — $ 2,436,545 $ 246,876 $ 2,189,669 $ — Debt securities (including restricted): U.S. Treasury and agency securities $ — $ — $ — $ — $ 10,016 $ 10,016 $ — $ — Commercial paper 40,000 — 40,000 — 369,397 — 369,397 — Corporate securities — — — — 28,796 — 28,796 — Other 202 — 13 189 8,885 — 8,689 196 Total $ 40,202 $ — $ 40,013 $ 189 $ 417,094 $ 10,016 $ 406,882 $ 196 Gains and Losses on Sales and Changes in Carrying Amounts of Investments “Other, net” within “Other Income (Expense)” included on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) is as follows: For the Three Months Ended For the Six Months Ended June 30, June 30, Other, net: 2020 2019 2020 2019 (In thousands) Marketable investment securities - realized and unrealized gains (losses) $ 32 $ 838 $ 90 $ 3,894 Costs related to early redemption of debt — — — (439) Equity in earnings of affiliates (264) 2,056 603 991 Other 248 (62) 915 7,474 Total $ 16 $ 2,832 $ 1,608 $ 11,920 |
Inventory
Inventory | 6 Months Ended |
Jun. 30, 2020 | |
Inventory | |
Inventory | 6. Inventory Inventory consisted of the following: As of June 30, December 31, 2020 2019 (In thousands) Finished goods $ 263,533 $ 255,155 Work-in-process and service repairs 34,245 34,120 Raw materials 17,591 33,623 Total inventory $ 315,369 $ 322,898 |
Property and Equipment
Property and Equipment | 6 Months Ended |
Jun. 30, 2020 | |
Property and Equipment | |
Property and Equipment | 7. Property and Equipment Property and equipment consisted of the following: Depreciable As of Life June 30, December 31, (In Years) 2020 2019 (In thousands) Equipment leased to customers 2 - 5 $ 1,799,429 $ 1,861,668 Satellites (1) 2 - 15 1,734,025 1,855,096 Satellites acquired under finance lease agreements 10 - 15 888,940 888,940 Furniture, fixtures, equipment and other 2 - 20 2,042,017 2,010,094 Buildings and improvements 5 - 40 354,274 349,347 Land - 17,810 17,810 Construction in progress (1) - 95,418 278,083 Total property and equipment 6,931,913 7,261,038 Accumulated depreciation (4,660,488) (4,554,856) Property and equipment, net $ 2,271,425 $ 2,706,182 (1) During the six months ended June 30, 2020, we wrote down the T1 satellite net book value of $48 million (net of accumulated depreciation of $18 million) and the D1 satellite net book value of $55 million to their estimated fair value of zero . In addition, during the six months ended June 30, 2020, we impaired $227 million for capitalized costs of equipment, labor and other assets related to the narrowband IoT deployment that would not be utilized in our 5G Network Deployment. As a result, we recorded a $ 330 million non-cash impairment charge in “Impairment of long-lived assets” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 2 for further information. Construction in progress consisted of the following: As of June 30, December 31, 2020 2019 (In thousands) Software $ 48,862 $ 51,493 Wireless (1) 28,028 207,814 Other 18,528 18,776 Total construction in progress $ 95,418 $ 278,083 (1) During the six months ended June 30, 2020, we impaired the capitalized costs of equipment, labor and other assets related to the narrowband IoT deployment that would not be utilized in our 5G Network Deployment, resulting in a $227 million non-cash impairment charge in “Impairment of long-lived assets” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 2 for further information. Depreciation and amortization expense consisted of the following: For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 (In thousands) Equipment leased to customers $ 69,515 $ 86,865 $ 149,229 $ 196,019 Satellites (1) 50,193 17,156 102,337 37,635 Buildings, furniture, fixtures, equipment and other 32,416 45,681 67,378 69,187 Total depreciation and amortization $ 152,124 $ 149,702 $ 318,944 $ 302,841 (1) The increase resulted from the Master Transaction Agreement pursuant to which, on September 10, 2019, certain satellites were transferred to us. See Note 13 for further information. 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 of which we own and depreciate over their estimated useful life. We currently utilize certain capacity on satellite that we lease from EchoStar, which is accounted for as an operating lease. We also lease satellites from third parties: Ciel II, which is accounted for as an operating lease, and Anik F3, Nimiq 5 and QuetzSat-1, which are accounted for as financing leases and are depreciated over their economic life. As of June 30, 2020, our pay-TV satellite fleet consisted of the following: Degree Lease Launch Orbital Termination Satellites Date Location Date Owned: EchoStar VII (1) February 2002 119 N/A EchoStar X (1) February 2006 110 N/A EchoStar XI (1) July 2008 110 N/A EchoStar XIV (1) March 2010 119 N/A EchoStar XV July 2010 61.5 N/A EchoStar XVI (1) November 2012 61.5 N/A EchoStar XVIII June 2016 61.5 N/A EchoStar XXIII (1) March 2017 67.9 N/A Leased from EchoStar (2): EchoStar IX August 2003 121 Month to month Leased from Other Third Party: Anik F3 April 2007 118.7 April 2022 Ciel II December 2008 129 January 2021 Nimiq 5 (1) September 2009 72.7 September 2024 QuetzSat-1 (1) September 2011 77 November 2021 (1) Pursuant to the Master Transaction Agreement, on September 10, 2019, these satellites and satellite service agreements were transferred to us. See Note 13 for further information. (2) See Note 13 for further information on our Related Party Transactions with EchoStar. Effective September 10, 2019, pursuant to the Master Transaction Agreement, the EchoStar XII satellite was transferred to us. During October 2019, the EchoStar XII satellite was de-orbited. ● |
Leases
Leases | 6 Months Ended |
Jun. 30, 2020 | |
Leases | |
Leases | 8. Leases We enter into operating and finance leases for, among other things, satellites, office space, warehouses and distribution centers, vehicles, wireless towers and other equipment. Our leases have remaining lease one some renewal options options terminate within Our Anik F3, Nimiq 5 and QuetzSat-1 satellites are accounted for as financing leases. Substantially all of our remaining leases are accounted for as operating leases. The components of lease expense were as follows: For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 (In thousands) Operating lease cost (1) $ 18,118 $ 83,914 $ 35,849 $ 164,984 Short-term lease cost (2) 2,891 3,742 5,558 6,226 Finance lease cost: Amortization of right-of-use assets 17,755 3,805 35,659 9,913 Interest on lease liabilities 5,443 1,099 11,256 2,280 Total finance lease cost 23,198 4,904 46,915 12,193 Total lease costs $ 44,207 $ 92,560 $ 88,322 $ 183,403 (1) Pursuant to the Master Transaction Agreement, effective September 10, 2019, approximately $495 million of previously reported operating lease assets and the related liabilities for satellites and real estate assets were transferred to us. See Note 13 for further information. These satellite and real estate assets are no longer included in “Operating lease assets,” “Other current liabilities” and “Operating lease liabilities,” but rather in “Property and equipment, net” on our Condensed Consolidated Balance Sheets. Lease expense related to these satellites and real estate assets for the three and six months ended June 30, 2019 was $67 million and $134 million, respectively. (2) Leases that have terms of 12 months or less. Supplemental cash flow information related to leases was as follows: For the Six Months Ended June 30, 2020 2019 (In thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 35,977 $ 168,668 Operating cash flows from finance leases $ 11,256 $ 2,295 Financing cash flows from finance leases $ 31,181 $ 10,454 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 22,708 $ 89,554 Finance leases $ — $ — Right-of-use assets and liabilities recognized at January 1, 2019 upon adoption of ASC 842 $ 733,584 Supplemental balance sheet information related to leases was as follows: As of June 30, December 31, 2020 2019 (In thousands) Operating Leases: Operating lease assets (1) $ 113,852 $ 144,330 Other current liabilities $ 58,625 $ 57,910 Operating lease liabilities 77,713 84,795 Total operating lease liabilities $ 136,338 $ 142,705 Finance Leases: Property and equipment, gross $ 889,708 $ 890,598 Accumulated depreciation (718,633) (683,271) Property and equipment, net $ 171,075 $ 207,327 Other current liabilities $ 64,501 $ 61,493 Other long-term liabilities 136,770 171,706 Total finance lease liabilities $ 201,271 $ 233,199 Weighted Average Remaining Lease Term: Operating leases 2.9 years 3.1 years Finance leases 3.4 years 3.8 years Weighted Average Discount Rate: Operating leases 4.6% 5.0% Finance leases 10.3% 10.2% (1) During the six months ended June 30, 2020, we impaired the operating lease assets related to the narrowband IoT deployment that would not be utilized in our 5G Network Deployment, resulting in a $27 million non-cash impairment charge in “Impairment of long-lived assets” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 2 for further information. Maturities of lease liabilities as of June 30, 2020 : Maturities of Lease Liabilities Operating Finance For the Years Ending December 31, Leases Leases Total (In thousands) 2020 (remaining six months) $ 33,509 $ 37,765 $ 71,274 2021 55,402 82,610 138,012 2022 30,511 48,307 78,818 2023 13,498 40,942 54,440 2024 8,367 30,707 39,074 Thereafter 3,346 — 3,346 Total lease payments 144,633 240,331 384,964 Less: Imputed interest (8,295) (39,060) (47,355) Total 136,338 201,271 337,609 Less: Current portion (58,625) (64,501) (123,126) Long-term portion of lease obligations $ 77,713 $ 136,770 $ 214,483 |
Long-Term Debt and Finance Leas
Long-Term Debt and Finance Lease Obligations | 6 Months Ended |
Jun. 30, 2020 | |
Long-Term Debt and Finance Lease Obligations | |
Long-Term Debt and Finance Lease Obligations | 9. Long-Term Debt and Finance Lease Obligations Fair Value of our Long-Term Debt The following table summarizes the carrying amount and fair value of our debt facilities as of June 30, 2020 and December 31, 2019: As of June 30, 2020 December 31, 2019 Carrying Fair Value Carrying Fair Value (In thousands) 5 1/8% Senior Notes due 2020 (1) $ — $ — $ 1,100,000 $ 1,110,208 6 3/4% Senior Notes due 2021 (2) 2,000,000 2,045,100 2,000,000 2,109,420 5 7/8% Senior Notes due 2022 2,000,000 2,043,040 2,000,000 2,129,580 5% Senior Notes due 2023 1,500,000 1,495,545 1,500,000 1,543,770 5 7/8% Senior Notes due 2024 2,000,000 2,000,340 2,000,000 2,049,080 2 3/8% Convertible Notes due 2024 1,000,000 895,980 1,000,000 918,720 7 3/4% Senior Notes due 2026 2,000,000 2,130,880 2,000,000 2,128,900 3 3/8% Convertible Notes due 2026 3,000,000 2,722,500 3,000,000 2,907,870 Other notes payable 67,298 67,298 70,946 70,946 Subtotal 13,567,298 $ 13,400,683 14,670,946 $ 14,968,494 Unamortized debt discount on the Convertible Notes (684,123) (735,811) Unamortized deferred financing costs and other debt discounts, net (25,184) (28,739) Finance lease obligations (3) 201,271 233,199 Total long-term debt and finance lease obligations (including current portion) $ 13,059,262 $ 14,139,595 (1) On May 1, 2020, we redeemed the principal balance of our 5 1/8% Senior Notes due 2020. (2) Our 6 3/4% Senior Notes due 2021 mature on June 1, 2021 and have been reclassified to “Current portion of long-term debt and finance lease obligations” on our Condensed Consolidated Balance Sheets as of June 30, 2020. (3) Disclosure regarding fair value of finance leases is not required. We estimated the fair value of our publicly traded long-term debt using market prices in less active markets (Level 2). |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies | |
Commitments and Contingencies | 10. Commitments and Contingencies Commitments Sprint Asset Acquisition Asset Purchase Agreement On July 26, 2019, we entered into the APA with the Sellers, sometimes referred to as NTM, to acquire from NTM certain assets and liabilities associated with the Prepaid Business for an aggregate purchase price of $1.4 billion as adjusted for specific categories of net working capital. Effective on the Closing Date, upon the terms and subject to the conditions set forth in the APA and in accordance with the Final Judgment, we and NTM completed the Prepaid Business Sale. Our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the quarter ending September 30, 2020 will include the results of the Prepaid Business from the Closing Date forward. Our Condensed Consolidated Balance Sheets for the quarter ending September 30, 2020 will include the assets and liabilities of the Prepaid Business, which will be appraised by a third-party, and will include various assumptions in determining fair value. These assets and liabilities may include intangible assets associated with the MNSA, the Option Agreement, the Spectrum Purchase Agreement, and the TSA, each as further discussed below. Pursuant to certain accounting rules, the purchase price for the acquisition of the Prepaid Business will be adjusted for, among other things, specific categories of net working capital and certain payments from third parties. In connection with the Prepaid Business Sale and the consummation of the Sprint-TMUS merger, we, TMUS, Sprint, DT and SoftBank came to an agreement with the DOJ on key terms and approval of the Transaction Agreements and our wireless service business and spectrum. On July 26, 2019, the Defendants entered into the Stipulation and Order with the DOJ binding the Defendants to the Proposed Final Judgment, which memorialized the agreement between the DOJ and the Defendants. The Stipulation and Order and the Proposed Final Judgment were filed in the District Court on July 26, 2019 and on April 1, 2020, the Final Judgment was entered with the District Court and . The term of the Final Judgment is seven years from the date of its entry with the District Court or five years if the DOJ gives notice that the divestitures, build- outs and other requirements have been completed to its satisfaction. A Monitoring Trustee has been appointed by the District Court that has the power and authority to monitor the Defendants’ compliance with the Final Judgment and settle disputes among the Defendants regarding compliance with the provisions of the Final Judgment and may recommend action to the DOJ in the event a party fails to comply with the Final Judgment. Also in connection with the closing of the Prepaid Business Sale, we and NTM entered into the TSA, the MNSA, the Option Agreement, and the Spectrum Purchase Agreement for an additional approximately $3.59 billion. Transition Services Agreement TMUS and DISH Network entered into a TSA upon the Closing Date of the Prepaid Business Sale, pursuant to which TMUS provides certain transition services to us for the Prepaid Business for a period of two years from July 1, 2020. Additionally, under the Final Judgment, we may apply to the DOJ for one or more extensions of the term of the TSA, which the DOJ can approve or deny in its sole discretion, and the TSA contemplates the option to renew the TSA for a third or additional years. The transition services are provided at cost, which shall not exceed a specific amount in the first year, plus certain pass-through costs and out-of-pocket expenses, during the first two years . If any transition services are renewed for a third year, the transition services will be provided at cost plus a certain mark-up, plus certain additional costs. Master Network Services Agreement TMUS and DISH Network entered into an MNSA upon the Closing Date of the Prepaid Business Sale, pursuant to which we also receive network services from NTM for a period of seven years. As set forth in the MNSA, NTM provides to us, among other things, (i) legacy network services for Boost Mobile and certain other prepaid end users on the Sprint network, (ii) NTM network services for certain end users that have been migrated to the NTM network or provisioned on the NTM network by or on behalf of us and (iii) infrastructure mobile network operator services to assist in the access and integration of our network. Pursuant to the terms of the MNSA, we face certain restrictions on making offerings that may combine the access to services provided under the MNSA with access to the facilities or services provided by certain third parties, subject to certain exceptions and carve-outs. We have the right to offer differentiated pricing, products and features to our end users under our brands in conjunction with the services provided under the MNSA, subject to certain qualifications and restrictions. We have certain restrictions on our ability to wholesale, sub-distribute or resell the services provided under the MNSA to third parties. During and after the term of the MNSA, NTM has agreed to certain restrictions with respect to the use of certain information in the targeting of customers. In the event of a “change of control” of DISH Network, the MNSA will terminate upon the earlier of two years following the consummation of the change of control or the date on which the MNSA would have otherwise terminated or expired in accordance with its terms. However, we would remain able to provision new users for after the change of control and also retain access to roaming services on the NTM network for both new and existing users for the remainder of the original term of the MNSA. Generally, a change of control would occur in the first of our wireless communications business assets (excluding our wireless terrestrial spectrum licenses and entities that own our wireless terrestrial spectrum licenses). A permitted owner generally includes Charles W. Ergen (including his family and certain related trusts and entities) and certain financial investors. Following the first a majority of our wireless communications business assets (excluding our wireless terrestrial spectrum licenses and entities that own our wireless terrestrial spectrum licenses). A “restricted person” generally includes certain U.S. wireless providers and U.S. cable companies (with certain exceptions), as well as any other entities that do not enter into a network usage agreement with NTM restricting such person from generally engaging in certain activities that are detrimental to the NTM network. Spectrum Purchase Agreement Pursuant to the Spectrum Purchase Agreement that was entered into upon the Closing Date of the Prepaid Business Sale, we are expected to purchase all of Sprint’s 800 MHz spectrum (approximately 13.5 MHz of nationwide spectrum). The covered spectrum must be divested within the later of three years from the Closing Date and five days after receipt of FCC approval for the transfer, following an application for FCC approval to be filed three years following the closing of the Sprint-TMUS merger. The DOJ may in its sole discretion agree to extend the deadline for the spectrum divestiture for up to 60 days pursuant to the Final Judgment. NTM may exercise an option to lease back 4 MHz (2 MHz downlink + 2 MHz uplink) of the spectrum for two years following the closing of the 800 MHz spectrum sale at the same per-Pop rate used to calculate the purchase price paid by us to NTM – a rate of approximately $68 million per year. We and NTM have made customary representations, warranties and covenants pursuant to the Spectrum Purchase Agreement, including representations by NTM regarding the validity of the licenses for the purchased spectrum. Pursuant to the Spectrum Purchase Agreement, we and NTM each indemnify the other against losses suffered as a result of breaches of the other’s representations and warranties or covenants. The indemnification provisions are subject to certain deductible and cap limitations and time limitations with respect to recovery for losses. If we breach the Spectrum Purchase Agreement prior to the closing or fail to deliver the purchase price following the satisfaction or waiver of all closing conditions, our sole liability to NTM will be to pay NTM a fee of approximately $72 million. If NTM fails to sell the spectrum to us following the satisfaction or waiver of all closing conditions, our sole recourse will be to seek specific performance, and if (and only if) specific performance is unavailable, to seek damages of up to approximately Option Agreement The Option Agreement, which was entered into upon the Closing Date of the Prepaid Business Sale, provides us an exclusive option to assume certain assets and liabilities under certain circumstances for any of the cell sites and retail stores that NTM decommissions during the term of the Option Agreement. NTM must make a minimum of 20,000 cell sites and 400 retail stores available to us pursuant to the Final Judgment. With respect to each decommissioned site, we may choose to acquire: (a) only the lease for such site, (b) the lease and a predetermined list of equipment at the site or (c) the lease and all of the equipment at the site. Under the Final Judgment, NTM must provide a detailed schedule which identifies each cell site that is scheduled to be decommissioned within five years of the Closing Date. The Option Agreement will remain in place for five years following the Closing Date. Agreement with the DOJ: The Stipulation and Order and the Final Judgment Certain of the provisions of the Stipulation and Order and the Final Judgment are also reflected in the terms of the Transaction Agreements. In addition to the terms reflected in the Transaction Agreements, the Stipulation and Order and the Final Judgment provide for other rights and obligations of the Sellers and us, including the following: ● For a period of one year after the Closing Date, if we determine that certain assets not included in the divestiture were previously used by the Prepaid Business and are reasonably necessary for the continued competitiveness of the Prepaid Business, subject to certain carve-outs, we may request that such assets be transferred to us, which the DOJ can approve or deny in its sole discretion. ● Within one year of the Closing Date, we are required to offer nationwide postpaid retail mobile wireless service. ● If we elect not to purchase the 800 MHz licenses pursuant to the Spectrum Purchase Agreement, we must pay $360 million (equal to 10% of the Spectrum Purchase Agreement purchase price) to the United States. However, we will not be required to make such payment if we have deployed a core network and offered 5G service to at least 20% of the U.S. population within three years of the Closing Date. ● If we buy the 800 MHz spectrum pursuant to the Spectrum Purchase Agreement but fail to deploy all of the 800 MHz spectrum licenses for use in the provision of retail mobile wireless services by the expiration of the Final Judgment, the DOJ may require us to forfeit to the FCC any of the 800 MHz licenses for spectrum that are not being used to provide retail mobile wireless services, unless we are already providing nationwide retail wireless service. ● We and NTM must negotiate in good faith to reach an agreement for NTM to lease some or all of our 600 MHz spectrum licenses for deployment to retail consumers by NTM. We and NTM must report on the status of the negotiations within 90 days after the filing of the Final Judgment. If no agreement has been reached by 180 days following the filing of the Final Judgment, the DOJ may resolve any dispute in its sole discretion, provided that such resolution must be on commercially reasonable terms to both parties. Since it has been 180 days since the filing of the Final Judgment, we are waiting a decision from the DOJ. ● We and NTM must agree to support eSIM technology on smartphones. ● The Sellers must introduce the suppliers and distributors of the Prepaid Business to us and the Sellers may not interfere in our negotiations with such suppliers and distributors. ● On the first day of the fiscal quarter following the entry of the Final Judgment and of each 180 -day period thereafter, we will be obligated to provide the DOJ with a description of our deployment efforts over the prior quarter including: (i) the number of towers and small cells deployed, (ii) the spectrum bands on which we have deployed equipment, (iii) progress in obtaining devices that operate on our spectrum frequencies, (iv) POPs coverage of our network, (v) the number of our mobile wireless subscriptions, (vi) the amount of traffic transmitted to our subscribers using our network and using NTM’s network, and (vii) whether there are or have been any efforts by NTM to interfere with our efforts to deploy and operate our network. ● We cannot sell, lease or otherwise provide the right to use any of the divested assets to any national facilities-based mobile wireless provider and may not sell any of the divested assets or similar assets back to TMUS during the term of the Final Judgment, except that we may lease back to NTM up to 4 MHz of the 800 MHz spectrum we will acquire (as discussed above). ● We must comply with the June 14, 2023 AWS-4, Lower 700 MHz E Block, AWS H Block, and nationwide 5G broadband network build- out commitments made to the FCC, subject to verification by the FCC (as described below). If we fail to comply with such build-out commitments, we may be subject to civil contempt in addition to the substantial voluntary contributions and license forfeitures described below if we fail to meet these commitments (as described below). FCC Build-Out Commitments In a letter filed with the FCC on July 26, 2019, we voluntarily committed to deploy a nationwide 5G broadband network and meet revised timelines relating to the build-out of our AWS-4, Lower 700 MHz E Block, AWS H Block and 600 MHz spectrum assets, subject to certain penalties. Pursuant to these commitments, we requested multi-year extensions to deploy our AWS-4, Lower 700 MHz E Block, and AWS H Block spectrum, and we have committed to build-out our 600 MHz licenses on an accelerated schedule to better align with our 5G deployment. We have also committed to offer 5G broadband service to certain population coverage targets, along with minimum core network, tower and spectrum use targets, and have waived our right to deploy any technology of our choice under the FCC’s “flexible use” rules with respect to these spectrum bands. Failure to meet the various commitments would require us to pay voluntary contributions totaling up to $2.2 billion to the FCC and would subject certain licenses in the AWS-4, Lower 700 MHz E Block, and AWS H Block spectrum to forfeiture. We have also agreed not to sell our AWS-4 and 600 MHz spectrum for six years without prior DOJ and FCC approval (unless such sale is part of a change of control of DISH Network). Additionally, we have agreed not to lease a certain percentage of network capacity on our AWS-4 and 600 MHz spectrum for six years to the three largest U.S. wireless carriers (i.e., AT&T, Verizon and NTM), without prior FCC approval. On November 5, 2019, the FCC released the FCC Merger Order. Upon the FCC issuing its Order effectuating these commitments, our 5G deployment commitments for each of the four spectrum bands will be generally as set forth below. We cannot predict with any degree of certainty the timing of the FCC issuing its Order effectuating these commitments. ● With respect to the 600 MHz licenses, we committed to offer 5G broadband service to at least 70% of the U.S. population and to have deployed a core network no later than June 14, 2023, and to offer 5G broadband service to at least 75% of the population in each Partial Economic Area (which are service areas established by the FCC) no later than June 14, 2025. Note that these commitments are earlier than the current 600 MHz Final Build-Out Requirement date of June 2029. See below for further information. ● With respect to the AWS-4 licenses, we committed to offer 5G broadband service to at least 20% of the U.S. population and to have deployed a core network no later than June 14, 2022, and to offer 5G broadband service to at least 70% of the U.S. population no later than June 14, 2023. ● With respect to the Lower 700 MHz E Block licenses, we committed to offer 5G broadband service to at least 20% of the U.S. population who are covered by such licenses and to have deployed a core network no later than June 14, 2022, and to offer 5G broadband service to at least 70% of the U.S. population who are covered by such licenses no later than June 14, 2023. ● With respect to the AWS H Block licenses, we committed to offer 5G broadband service to at least 20% of the U.S. population and to have deployed a core network no later than June 14, 2022, and to offer 5G broadband service to at least 70% of the U.S. population no later than June 14, 2023. Wireless Since 2008, we have directly invested over $11 billion to acquire certain wireless spectrum licenses and related assets and made over $10 billion in non-controlling investments in certain entities, for a total of over $21 billion. The capitalized interest Recent Wireless Spectrum Acquisitions 37 GHz, 39 GHz and 47 GHz . The auction million. On October 22, 2019, we paid $68 million to the FCC as a deposit for Auction 103. On April 9, 2020, we paid the remaining balance of our winning bids of approximately $135 million. On Wireless Spectrum Licenses These wireless spectrum licenses are subject to certain interim and final build-out requirements, as well as certain renewal requirements that are summarized in the table below : As of June 30, 2020 Build-Out Deadlines Carrying Expiration Amount Interim Final Date (In thousands) Owned: DBS Licenses (1) $ 677,409 700 MHz Licenses 711,871 June 14, 2022 (2) June 14, 2023 (5) June 2023 AWS-4 Licenses 1,940,000 June 14, 2022 (2) June 14, 2023 (5) June 2023 H Block Licenses 1,671,506 June 14, 2022 (2) June 14, 2023 (5) June 2023 600 MHz Licenses 6,211,154 June 14, 2023 (3) June 14, 2025 (6) June 2029 MVDDS Licenses (1) 24,000 August 2024 LMDS Licenses (1) — September 2028 28 GHz Licenses 2,883 October 2, 2029 (7) October 2029 24 GHz Licenses 11,772 December 11, 2029 (7) December 2029 37 GHz, 30 GHz and 47 GHz Licenses 202,533 June 4, 2030 (7) June 2030 Subtotal 11,453,128 Non-controlling Investments: AWS-3 Licenses 9,890,389 October 2021 (4) October 2027 (8) October 2027 (8) Capitalized Interest 5,087,577 Total $ 26,431,094 (1) The build-out deadlines for these licenses have been met. (2) For these licenses, we are committed to offer 5G broadband service to at least 20% of the U.S. population and to have developed a core network by this date. (3) For these licenses, we are committed to offer 5G broadband service to at least 70% of the U.S. population and to have developed a core network by this date. (4) For these licenses, Northstar Wireless and SNR Wireless must provide reliable signal coverage and offer service to at least 40% of the population of each license area by this date. (5) For these licenses, we are committed to offer 5G broadband service to 70% of the U.S. population by this date. (6) For these licenses, we are committed to offer 5G broadband service to at least 75% of the population in each Partial Economic Area (which are service areas established by the FCC) by this date. (7) There are a variety of build-out options and associated build-out metrics associated with these licenses. (8) For these licenses, Northstar Wireless and SNR Wireless must provide reliable signal coverage and offer service to at least 75% of the population of each license area by this date. If the AWS-3 interim build-out requirement is not met, the AWS-3 expiration date and the AWS-3 final build-out requirement may be accelerated by two years (from October 2027 to October 2025) for each AWS-3 License area in which Northstar Wireless and SNR Wireless do not meet the requirement. Commercialization of Our Wireless Spectrum Licenses and Related Assets. In March 2017, we notified the FCC that we planned to deploy a narrowband IoT network on certain of these wireless licenses, which was to be the First Phase. We expected to complete the First Phase by March 2020, with subsequent phases to be completed thereafter. In light of, among other things, certain developments related to the Sprint-TMUS merger, during the first quarter 2020, we determined that the revision of certain of our build-out deadlines was probable and, therefore, we no longer intended to complete our narrowband IoT deployment. As a result, during the first quarter 2020, we impaired certain assets that would not be utilized in our 5G Network Deployment, resulting in a $253 million non-cash impairment charge in “Impairment of long-lived assets” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). We have issued RFI/Ps to various 5G Network Deployment We currently expect expenditures for our wireless projects to be between $250 million and $500 million during 2020, excluding capitalized interest. We currently expect expenditures for our 5G Network Deployment to be approximately $10 billion, excluding capitalized interest. See Note 2 for further information. We will need to make significant additional investments or partner with others to, among other things, commercialize, build-out, and integrate these licenses and related assets, and any additional acquired licenses and related assets; and comply with regulations applicable to such licenses. Depending on the nature and scope of such commercialization, build-out, integration efforts, and regulatory compliance, any such investments or partnerships could vary significantly. In addition, as we consider our options for the commercialization of our wireless spectrum, we will incur significant additional expenses and will have to make significant investments related to, among other things, research and development, wireless testing and wireless network infrastructure. We may also determine that additional wireless spectrum licenses may be required to commercialize our wireless business and to compete with other wireless service providers. For example, on May 7, 2020, we filed an application with the FCC to participate as a potential bidder in the upcoming wireless spectrum auction for the Priority Access Licenses for the 3550-3650 MHz band (“Auction 105”). On July 1, 2020, the FCC announced that we and 271 other applicants were qualified to participate in Auction 105. The auction commenced on July 23, 2020. The FCC determined that bidding in this auction will be “anonymous,” which means that prior to and during the course of 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 will be able to develop and implement a business model that will realize a return on these wireless spectrum licenses or that we 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. DISH Network Non-Controlling Investments in the Northstar Entities and the SNR Entities Related to AWS-3 Wireless Spectrum Licenses Non-Controlling Investments During 2015, through our wholly-owned subsidiaries American II and American III, we initially made over $10 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. 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 consolidate these entities into our financial statements. See Note 2 for further information. Northstar Investment. Through American II, we own a non-controlling interest in Northstar Spectrum, which is comprised of 85% of the Class B Common Interests and 100% of the Class A Preferred Interests of Northstar Spectrum. Northstar Manager is the sole manager of Northstar Spectrum and owns a controlling interest in Northstar Spectrum, which is comprised of 15% of the Class B Common Interests of Northstar Spectrum. As of March 31, 2018, the total equity contributions from American II and Northstar Manager to Northstar Spectrum were approximately $7.621 billion and $133 million, respectively. As of March 31, 2018, the total loans from American II to Northstar Wireless under the Northstar Credit Agreement (as defined below) for payments to the FCC related to the Northstar Licenses (as defined below) were approximately $500 million. See below for further information. SNR Investment. Through American III, we own a non-controlling interest in SNR HoldCo, which is comprised of of the Class A Preferred Interests of SNR HoldCo. SNR Management is the sole manager of SNR HoldCo and owns a controlling interest in SNR HoldCo, which is comprised of 15% of the Class B Common Interests of SNR HoldCo. As of March 31, 2018, the total equity contributions from American III and SNR Management to SNR HoldCo were approximately million, respectively. As of March 31, 2018, the total loans from American III to SNR Wireless under the SNR Credit Agreement (as defined below) for payments to the FCC related to the SNR Licenses (as defined below) were approximately million. See below for further information. AWS-3 Auction Northstar Wireless and SNR Wireless each filed applications with the FCC to participate in Auction 97 (the “AWS-3 Auction”) for the purpose of acquiring certain AWS-3 Licenses. Each of Northstar Wireless and SNR Wireless applied to receive bidding credits of 25 % as designated entities under applicable FCC rules. Northstar Wireless was the winning bidder for AWS-3 Licenses with gross winning bid amounts totaling approximately $7.845 billion, which after taking into account a 25% bidding credit, was approximately $5.884 billion. SNR Wireless was the winning bidder for AWS-3 Licenses with gross winning bid amounts totaling approximately $5.482 billion, which after taking into account a 25% bidding credit, was approximately $4.112 billion. In addition to the net winning bids, SNR Wireless made a bid withdrawal payment of approximately $8 million. FCC Order and October 2015 Arrangements. Memorandum Opinion and Order which Letters Exchanged between Northstar Wireless and the FCC Wireless Bureau. As outlined in letters exchanged between Northstar Wireless and the Wireless Telecommunications Bureau of the FCC (the “FCC Wireless Bureau”), Northstar Wireless paid the gross winning bid amounts for 261 AWS-3 Licenses (the “Northstar Licenses”) totaling approximately $5.619 billion through the application of funds already on deposit with the FCC. Northstar Wireless also notified the FCC that it would not be paying the gross winning bid amounts for 84 AWS-3 Licenses totaling approximately $2.226 billion. As a result of the nonpayment of those gross winning bid amounts, the FCC retained those licenses and Northstar Wireless owed the FCC an additional interim payment of approximately $334 million (the “Northstar Interim Payment”), which is equal to 15% of $2.226 billion. The Northstar Interim Payment was recorded as an expense during the fourth quarter 2015. Northstar Wireless immediately satisfied the Northstar Interim Payment through the application of funds already on deposit with the FCC and an additional loan from American II of approximately $69 million. As a result, the FCC will not deem Northstar Wireless to be a “current defaulter” under applicable FCC rules. In addition, the FCC Wireless Bureau acknowledged that Northstar Wireless’ nonpayment of those gross winning bid amounts does not constitute action involving gross misconduct, misrepresentation or bad faith. Therefore, the FCC concluded that such nonpayment will not affect the eligibility of Northstar Wireless, its investors (including DISH Network) or their respective affiliates to participate in future spectrum auctions (including Auction 1000 and any re-auction of the AWS-3 licenses retained by the FCC). At this time, DISH Network (through itself, a subsidiary or another entity in which it may hold a direct or indirect interest) expects to participate in any re-auction of those AWS-3 licenses. If the winning bids from re-auction or other award of the AWS-3 licenses retained by the FCC are greater than or equal to the winning bids of Northstar Wireless, no additional amounts will be owed to the FCC. However, if those winning bids are less than the winning bids of Northstar Wireless, then Northstar Wireless will be responsible for the difference less any overpayment of the Northstar Interim Payment (which will be recalculated as 15% of the winning bids from re-auction or other award) (the “Northstar Re-Auction Payment”). For example, if the winning bids in a re-auction are $1, the Northstar Re-Auction Payment would be approximately $1.892 billion, which is calculated as the difference between $2.226 billion (the Northstar winning bid amounts) and $1 (the winning bids from re-auction) less the resulting $334 million overpayment of the Northstar Interim Payment. As discussed above, at this time, DISH Network (through itself, a subsidiary or another entity in which it may hold a direct or indirect interest) expects to participate in any re-auction. We cannot predict with any degree of certainty the timing or outcome of any re-auction or the amount of any Northstar Re-Auction Payment. DISH Network Guaranty in Favor of the FCC for Certain Northstar Wireless Obligations . On October 1, 2015, DISH Network entered into a guaranty in favor of the FCC (the “FCC Northstar Guaranty”) with respect to the Northstar Interim Payment (which was satisfied on October 1, 2015) and any Northstar Re-Auction Payment. The FCC Northstar Guaranty provides, among other things, that during the period between the due date for the payments guaranteed under the FCC Northstar Guaranty and the date such guaranteed payments are paid: (i) Northstar Wireless’ payment obligations to American II under the Northstar Credit Agreement will be subordinated to such guaranteed payments; and (ii) DISH Network or American II will withhold exercising certain rights as a creditor of Northstar Wireless. Letters Exchanged between SNR Wireless and the FCC Wireless Bureau. million). SNR Wireless also notified the FCC that it would not be paying the gross winning bid amounts for 113 AWS-3 Licenses totaling approximately $1.211 billion. As a result of the nonpayment of those gross winning bid amounts, the FCC retained those licenses and SNR Wireless owed the FCC an additional interim payment of approximately $182 million (the “SNR Interim Payment”), which is equal to 15% of $1.211 billion. The SNR Interim Payment was recorded as an expense during the fourth quarter 2015. SNR Wireless immediately satisfied the SNR Interim Payment through a portion of an additional loan from American III in an aggregate amount of approximately $344 million. As a result, the FCC will not deem SNR Wireless to be a “current defaulter” under applicable FCC rules. In addition, the FCC Wireless Bureau acknowledged that SNR Wireless’ nonpayment of those gross winning bid amounts does not constitute action involving gross misconduct, misrepresentation or bad faith. Therefore, the FCC concluded that such nonpayment will not affect the eligibility of SNR Wireless, its investors (including DISH Network) or their respective affiliates to participate in future spectrum auctions (including Auction 1000 and any re-auction of the AWS-3 licenses retained by the FCC). At this time, DISH Network (through itself, a subsidiary or another entity in which it may hold a direct or indirect interest) expects to participate in any re-auctio |
Segment Reporting
Segment Reporting | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting | |
Segment Reporting | 11. 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 currently operate two primary business segments: (1) Pay-TV; and (2) Wireless. See Note 1 for further information. All other and eliminations primarily include intersegment eliminations related to intercompany debt and the related interest income and interest expense, which are eliminated in consolidation. The total assets, revenue and operating income by segment were as follows: As of June 30, December 31, 2020 2019 (In thousands) Total assets: Pay-TV $ 32,152,834 $ 31,531,612 Wireless 26,278,932 25,686,381 Eliminations (24,934,292) (23,987,058) Total assets $ 33,497,474 $ 33,230,935 For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 (In thousands) Revenue: Pay-TV $ 3,186,444 $ 3,211,836 $ 6,404,468 $ 6,400,005 Wireless 1,279 120 2,381 123 Eliminations (633) (644) (2,370) (1,672) Total revenue $ 3,187,090 $ 3,211,312 $ 6,404,479 $ 6,398,456 Operating income (loss): Pay-TV $ 693,511 $ 457,114 $ 1,235,153 $ 914,483 Wireless (1) (55,861) (26,382) (453,425) (27,451) Total operating income (loss) $ 637,650 $ 430,732 $ 781,728 $ 887,032 (1) The six months ended June 30, 2020 were negatively impacted by “Impairment of long-lived assets” of $356 million , resulting from non-cash impairments of the T1 satellite and D1 satellites, as well as capitalized costs of equipment, labor and other assets and operating lease assets related to the narrowband IoT deployment that would not be utilized in our 5G Network Deployment. See Note 2 for further information. Geographic Information. Revenue is attributed to geographic regions based upon the location where the goods and services are provided. All subscriber-related revenue was derived from the United States. Substantially all of our long-lived assets reside in the United States. The following table summarizes revenue by geographic region: For the Three Months Ended For the Six Months Ended June 30, June 30, Revenue: 2020 2019 2020 2019 (In thousands) United States $ 3,181,999 $ 3,200,541 $ 6,383,447 $ 6,376,794 Canada and Mexico 5,091 10,771 21,032 21,662 Total revenue $ 3,187,090 $ 3,211,312 $ 6,404,479 $ 6,398,456 The revenue from external customers disaggregated by major revenue source was as follows: For the Three Months Ended For the Six Months Ended June 30, June 30, Category: 2020 2019 2020 2019 (In thousands) Pay-TV video and related revenue $ 3,117,334 $ 3,117,065 $ 6,248,234 $ 6,215,001 Broadband revenue 32,479 45,507 67,620 95,341 Equipment sales and other revenue 37,277 48,740 88,625 88,114 Total $ 3,187,090 $ 3,211,312 $ 6,404,479 $ 6,398,456 All revenues during the three and six months ended June 30, 2020 and 2019 were primarily derived from our Pay-TV segment. |
Contract Balances
Contract Balances | 6 Months Ended |
Jun. 30, 2020 | |
Contract Balances | |
Contract Balances | 12. Contract Balances Our valuation and qualifying accounts as of June 30, 2020 were as follows: Allowance for credit losses Balance at Current Period Provision for Expected Credit Losses Write-offs Charged Against Allowance Balance at (In thousands) For the six months ended June 30, 2020 $ 19,280 $ 51,762 $ (21,974) $ 49,068 Deferred revenue related to contracts with our customers is recorded in “Deferred revenue and other” and “Long-term deferred revenue and other long-term liabilities” on our Condensed Consolidated Balance Sheets. Changes in deferred revenue related to contracts with our customers were as follows: Contract Liabilities (In thousands) Balance as of December 31, 2019 $ 613,272 Recognition of unearned revenue (2,995,089) Deferral of revenue 2,967,820 Balance as of June 30, 2020 $ 586,003 We apply a practical expedient and do not disclose the value of the remaining performance obligations for contracts that are less than one year in duration, which represent a substantial majority of our revenue. As such, the amount of revenue related to unsatisfied performance obligations is not necessarily indicative of our future revenue. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2020 | |
Related Party Transactions | |
Related Party Transactions | 13. Related Party Transactions Master Transaction Agreement On May 19, 2019, we entered into the Master Transaction Agreement with EchoStar. Pursuant to the Master Transaction Agreement, among other things: (i) EchoStar carried out an internal reorganization in which certain assets and liabilities of the EchoStar Satellite Services segment, the business segment of EchoStar that provides broadcast satellite operations and satellite services, as well as certain related licenses, real estate properties and employees (together, the “BSS Business”) were transferred to Newco (the “Pre-Closing Restructuring”); (ii) EchoStar distributed all outstanding shares of common stock, par value per share, of EchoStar; and (iii) upon the consummation of the Pre-Closing Restructuring and the Distribution, Merger Sub merged with and into Newco (the “Merger”) such that, upon consummation of the Merger, Merger Sub ceased to exist and Newco continued as our wholly-owned subsidiary. Effective September 10, 2019, pursuant to the terms and subject to the conditions set forth in the Master Transaction Agreement, in consideration for the Merger, we issued 22,937,188 shares of our Class A common stock to the holders of Newco Common Stock at a ratio of 0.23523769 of our Class A common stock for each outstanding share of Newco Common Stock. The transaction was structured as a tax-free spin-off and merger. In addition, as the result of the Merger, we, EchoStar and, as relevant, certain of our or their respective subsidiaries, entered into ancillary agreements involving tax, employment and intellectual property matters, which set forth certain rights and obligations of us and EchoStar and our and their respective subsidiaries related to the Merger with respect to, among other things: (i) the payment of tax liability refunds, and the filing of tax returns related to Newco and the BSS Business; (ii) the allocation of employment-related assets and liabilities between us and EchoStar; (iii) certain employee compensation, equity awards, benefit plans, programs and arrangements relating to employees who are expected to be transferred to us pursuant to the Merger; (iv) a cross-license between us and EchoStar for certain intellectual property either transferred to us as part of the Merger or retained by EchoStar that is also used in the BSS Business; and (v) the provision of certain telemetry, tracking and control services by us and our subsidiaries to EchoStar and its subsidiaries. The description of the Master Transaction Agreement in this section is qualified in its entirety by reference to the complete text of the Master Transaction Agreement, a copy of which is filed as Exhibit 2.1 to our Quarterly Report on Form 10-Q for the quarter ended June 30, 2019. The Merger was accounted for as an asset purchase, as substantially all of the fair value of the gross assets acquired was concentrated in a group of similar identifiable assets. As the Merger was between entities that were under common control, we recorded the assets and liabilities received under the Merger at EchoStar’s historical cost basis, with the offsetting amount recorded in “Additional paid-in capital” on our Condensed Consolidated Balance Sheets. A significant portion of the assets received under the Merger were historically leased to us by EchoStar. As these assets and the related liabilities have been transferred to us pursuant to the Master Transaction Agreement, they are no longer be included in “Operating lease assets,” “Other current liabilities” and “Operating lease liabilities,” but rather in “Property and equipment, net” on our Condensed Consolidated Balance Sheets. Spin-off from EchoStar Following the Spin-off, we and EchoStar have operated as separate publicly-traded companies and neither entity has any ownership interest in the other. However, a substantial majority of the voting power of the shares of both companies is owned beneficially by Charles W. Ergen, our Chairman, and by certain entities established by Mr. Ergen for the benefit of his family. Related Party Transactions with EchoStar In connection with and following the Spin-off, we and EchoStar have entered into certain agreements pursuant to which we obtain certain products, services and rights from EchoStar, EchoStar obtains certain products, services and rights from us, and we and EchoStar have indemnified each other against certain liabilities arising from our respective businesses. Pursuant to the Share Exchange Agreement, among other things, EchoStar transferred to us certain assets and liabilities of the EchoStar technologies and EchoStar broadcasting businesses. Pursuant to the Master Transaction Agreement, among other things, EchoStar transferred to us certain assets and liabilities of its EchoStar Satellite Services segment. In connection with the Share Exchange and the Master Transaction Agreement, we and EchoStar and certain of their subsidiaries entered into certain agreements covering, among other things, tax matters, employee matters, intellectual property matters and the provision of transitional services. In addition, certain agreements that we had with EchoStar have terminated, and we entered into certain new agreements with EchoStar. We also may enter into additional agreements with EchoStar in the future. The following is a summary of the terms of our principal agreements with EchoStar that may have an impact on our financial condition and results of operations. “Trade accounts receivable” As of June 30, 2020 and December 31, 2019, trade accounts receivable from EchoStar was $4 million and $1 million, respectively. These amounts are recorded in “Trade accounts receivable” on our Condensed Consolidated Balance Sheets. “Trade accounts payable” As of June 30, 2020 and December 31, 2019, trade accounts payable to EchoStar was $25 million and $10 million, respectively. These amounts are recorded in “Trade accounts payable” on our Condensed Consolidated Balance Sheets. “Equipment sales and other revenue” During the three months ended June 30, 2020 and 2019, we received $2 million and $1 million, respectively, for services provided to EchoStar. During the six months ended June 30, 2020 and 2019, we received million, respectively, for services provided to EchoStar. These amounts are recorded in “Equipment sales and other revenue” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The agreements pertaining to these revenues are discussed below. Real Estate Lease Agreements. We have entered into lease agreements pursuant to which we lease certain real estate to EchoStar. The rent on a per square foot basis for each of the leases is comparable to per square foot rental rates of similar commercial property in the same geographic areas, and EchoStar is responsible for its portion of the taxes, insurance, utilities and maintenance of the premises. The term of each lease is set forth below: ● El Paso Lease Agreement. During 2012, we began leasing certain space at 1285 Joe Battle Blvd., El Paso, Texas to EchoStar for an initial period ending on August 1, 2015, which also provides EchoStar with renewal options for four consecutive three-year terms. During the second quarter 2015, EchoStar exercised its first renewal option for a period ending on August 1, 2018 and in April 2018 EchoStar exercised its second renewal option for a period ending in August 2021. ● 90 Inverness Lease Agreement . In connection with the completion of the Share Exchange, effective March 1, 2017, EchoStar leases certain space from us at 90 Inverness Circle East, Englewood, Colorado for a period ending in February 2022. EchoStar has the option to renew this lease for four three-year periods. ● Cheyenne Lease Agreement . In connection with the completion of the Share Exchange, effective March 1, 2017, EchoStar leases certain space from us at 530 EchoStar Drive, Cheyenne, Wyoming for a period ending in February 2019. In August 2018, EchoStar exercised its option to renew this lease for a one-year period ending in February 2020. EchoStar has the option to renew this lease for 12 one-year periods. In connection with the Master Transaction Agreement, we and EchoStar amended this lease to provide EchoStar with certain space for a period ending in September 2021, with the option for EchoStar to renew for a one-year period upon 180 days’ written notice prior to the end of the term. ● Gilbert Lease Agreement . In connection with the completion of the Share Exchange, effective March 1, 2017, EchoStar leases certain space from us at 801 N. DISH Dr., Gilbert, Arizona for a period ending in March 2019. EchoStar exercised its option to renew this lease for a one-year period ending in February 2020. This lease was terminated effective September 10, 2019. ● American Fork Occupancy License Agreement. In connection with the completion of the Share Exchange, effective March 1, 2017, we acquired the lease for certain space at 796 East Utah Valley Drive, American Fork, Utah, and we sublease certain space at this location to EchoStar for a period ending in August 2017. In June 2017, EchoStar exercised its five-year renewal option for a period ending in August 2022. This lease was terminated effective March 2019. Collocation and Antenna Space Agreements 1, 2017, we entered into certain agreements pursuant to which we will provide certain collocation and antenna space to HNS through February 2022 at the following locations: Cheyenne, Wyoming; Gilbert, Arizona; New Braunfels, Texas; Monee, Illinois; Englewood, Colorado; and Spokane, Washington. During August 2017, we entered into certain other agreements pursuant to which we will provide certain collocation and antenna space to HNS through August 2022 at the following locations: Monee, Illinois and Spokane, Washington. HNS has the option to renew each of these agreements for periods. HNS may terminate certain of these agreements with days’ prior written notice to us at the following locations: New Braunfels, Texas; Englewood, Colorado; and Spokane, Washington. In September 2019, in connection with the Master Transaction Agreement, we entered into an agreement pursuant to which we provide HNS with certain additional collocation space in Cheyenne, Wyoming for a period ending in September 2020, with the option for HNS to renew for a prior to the end of the term. In October 2019, HNS provided a termination notice for its New Braunfels, Texas agreement to be effective May 2020. The fees for the services provided under these agreements depend, among other things, on the number of racks leased and/or antennas present at the location. Also in connection with the Master Transaction Agreement, in September 2019, we entered into an agreement pursuant to which we will provide HNS with antenna space and power in Cheyenne, Wyoming for a period of five years commencing no later than October 2020, with four three-year renewal terms, with prior written notice no more than 120 days but no less than 90 days prior to the end of the then-current term. TT&C Agreement – Master Transaction Agreement . In September 2019, in connection with the Master Transaction Agreement, we entered into an agreement pursuant to which we provide TT&C services to EchoStar for a period ending in September 2021, with the option for EchoStar to renew for a prior to the initial expiration (the “MTA TT&C Agreement”). The fees for services provided under the MTA TT&C Agreement are calculated at either: (i) a fixed fee or (ii) cost plus a fixed margin, which will vary depending on the nature of the services provided. Either party is able to terminate the MTA TT&C Agreement for any reason upon “Subscriber-related expenses” During the three months ended June 30, 2020 and 2019 , we incurred $4 million and $7 million, respectively, of subscriber-related expenses for services provided to us by EchoStar. , we incurred $9 million and $14 million, respectively, of subscriber-related expenses for services provided to us by EchoStar. These amounts are recorded in “Subscriber-related expenses” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The agreements pertaining to these expenses are discussed below. Hughes Broadband Distribution Agreement . Effective October 1, 2012, dishNET Satellite Broadband L.L.C. (“dishNET Satellite Broadband”), our indirect wholly-owned subsidiary, and HNS entered into a Distribution Agreement (the “Distribution Agreement”) pursuant to which dishNET Satellite Broadband has the right, but not the obligation, to market, sell and distribute the HNS satellite Internet service (the “Service”). dishNET Satellite Broadband pays HNS a monthly per subscriber wholesale service fee for the Service based upon the subscriber’s service level, and, beginning January 1, 2014, certain volume subscription thresholds. The Distribution Agreement also provides that dishNET Satellite Broadband has the right, but not the obligation, to purchase certain broadband equipment from HNS to support the sale of the Service. On February 20, 2014, dishNET Satellite Broadband and HNS amended the Distribution Agreement which, among other things, extended the initial term of the Distribution Agreement through March 1, 2024. Thereafter, the Distribution Agreement automatically renews for successive one year terms unless either party gives written notice of its intent not to renew to the other party at least 180 days before the expiration of the then-current term. Upon expiration or termination of the Distribution Agreement, the parties will continue to provide the Service to the then-current dishNET subscribers pursuant to the terms and conditions of the Distribution Agreement. During the first quarter 2017, we transitioned our wholesale arrangement with Hughes under the Distribution Agreement to an authorized representative arrangement and entered into the MSA with HNS. See “ Hughes Broadband Master Services Agreement” “Satellite and transmission expenses” During the three months ended June 30, 2020 and 2019 , we incurred expenses of $1 million and $73 million, respectively, for satellite capacity leased from EchoStar and telemetry, tracking and control and other professional services provided to us by EchoStar. , we incurred expenses of $2 million and $146 million, respectively, for satellite capacity leased from EchoStar and telemetry, tracking and control and other professional services provided to us by EchoStar. EchoStar was the supplier of the vast majority of our transponder capacity. On May 19, 2019, we entered into a Master Transaction Agreement pursuant to which, on September 10, 2019, certain of these satellites were transferred to us (see below). See above for further information on the Master Transaction Agreement. These amounts are recorded in “Satellite and transmission expenses” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The agreements pertaining to these expenses are discussed below. Satellite Capacity Leased from EchoStar. We have entered into certain satellite capacity agreements pursuant to which we lease certain capacity on certain satellites owned or leased by EchoStar. The fees for the services provided under these satellite capacity agreements depend, among other things, upon the orbital location of the applicable satellite, the number of transponders that are leased on the applicable satellite and the length of the lease. See “Pay-TV Satellites” in Note 7 for further information. The term of each lease is set forth below: ● EchoStar VII, X, XI and XIV . On March 1, 2014, we began leasing all available capacity from EchoStar on the EchoStar VII, X, XI and XIV satellites. The term of each satellite capacity agreement generally terminates upon the earlier of: (i) the end-of-life of the satellite; (ii) the date the satellite fails; or (iii) a certain date, which depends upon, among other things, the estimated useful life of the satellite. We generally have the option to renew each satellite capacity agreement on a year-to-year basis through the end of the respective satellite’s life. There can be no assurance that any options to renew such agreements will be exercised. The satellite capacity agreement for EchoStar VII expired on June 30, 2018. On May 19, 2019, we entered into a Master Transaction Agreement pursuant to which, on September 10, 2019, these satellites were transferred to us. See above for further information on the Master Transaction Agreement. ● EchoStar IX . We lease certain satellite capacity from EchoStar on EchoStar IX. Subject to availability, we generally have the right to continue to lease satellite capacity from EchoStar on EchoStar IX on a month-to-month basis. ● EchoStar XVI. In December 2009, we entered into a transponder service agreement with EchoStar to lease all of the capacity on EchoStar XVI, a DBS satellite, after its service commencement date. EchoStar XVI was launched in November 2012 to replace EchoStar XV at the 61.5 degree orbital location and is currently in service. Effective December 21, 2012, we and EchoStar amended the transponder service agreement to, among other things, change the initial term to generally expire upon the earlier of: (i) the end-of-life or replacement of the satellite; (ii) the date the satellite fails; (iii) the date the transponder(s) on which service is being provided under the agreement fails; or (iv) four years following the actual service commencement date. In July 2016, we and EchoStar amended the transponder service agreement to, among other things, extend the initial term by one additional year and to reduce the term of the first renewal option by one year. Prior to expiration of the initial term, we had the option to renew for an additional five-year period. In May 2017, we exercised our first renewal option for an additional five-year period ending in January 2023. We also have the option to renew for an additional five-year period prior to expiration of the first renewal period in January 2023. There can be no assurance that the option to renew this agreement will be exercised. During 2018, we and EchoStar further amended the agreement to, among other things, allow us to place and use certain satellites at the 61.5 degree orbital location. On May 19, 2019, we entered into a Master Transaction Agreement pursuant to which, on September 10, 2019, this satellite was transferred to us. See above for further information on the Master Transaction Agreement. Nimiq 5 Agreement . During 2009, EchoStar entered into a DBS transponders on the Nimiq 5 satellite at the 72.7 degree orbital location (the “Telesat Transponder Agreement”). During 2009, EchoStar also entered into a satellite service agreement (the “DISH Nimiq 5 Agreement”) with us, pursuant to which we received service from EchoStar on all 32 of the DBS transponders covered by the Telesat Transponder Agreement. Under the terms of the DISH Nimiq 5 Agreement, we made certain monthly payments to EchoStar that commenced in 2009 when the Nimiq 5 satellite was placed into service and continued through the service term, which expired ten years following the date the Nimiq 5 satellite was placed into service. Upon expiration of the initial term, we have the option to renew on a year-to-year basis through the end-of-life of the Nimiq 5 satellite. On May 19, 2019, we entered into a Master Transaction Agreement pursuant to which, on September 10, 2019, the Telesat Transponder Agreement was transferred to us. In September 2019, we and EchoStar entered into an agreement whereby we compensate EchoStar for retaining certain obligations to Telesat related to our performance under the Telesat Transponder Agreement. See above for further information on the Master Transaction Agreement. QuetzSat-1 Lease Agreement. During 2008, EchoStar entered into a ten-year satellite service agreement with SES Latin America S.A. (“SES”), which provided, among other things, for the provision by SES to EchoStar of service on 32 DBS transponders on the QuetzSat-1 satellite (“SES Transponder Agreement”). During 2008, EchoStar also entered into a transponder service agreement (“QuetzSat-1 Transponder Agreement”) with us pursuant to which we received service from EchoStar on 24 DBS transponders. QuetzSat-1 was launched on September 29, 2011 and was placed into service during the fourth quarter 2011 at the 67.1 degree orbital location. In January 2013, QuetzSat-1 was moved to the 77 degree orbital location and we commenced commercial operations at that location in February 2013. During the first quarter 2013, we and EchoStar entered into an agreement pursuant to which we subleased five DBS transponders back to EchoStar. Unless earlier terminated under the terms and conditions of the SES Transponder Agreement and QuetzSat-1 Transponder Agreement, the initial service term will expire in November 2021. Upon expiration of the initial term, we have the option to renew the SES Transponder Agreement on a year-to-year basis through the end-of-life of the QuetzSat-1 satellite. There can be no assurance that any options to renew the SES Transponder Agreement will be exercised. On May 19, 2019, we entered into a Master Transaction Agreement pursuant to which, on September 10, 2019, the SES Transponder Agreement was transferred to us. See above for further information on the Master Transaction Agreement. TT&C Agreement. Effective January 1, 2012, we entered into a TT&C agreement pursuant to which we receive TT&C services from EchoStar for certain satellites (the “TT&C Agreement”). In February 2018, we amended the TT&C Agreement to, among other things, extend the term for one-year with four automatic one-year renewal periods. The fees for services provided under the TT&C Agreement are calculated at either: (i) a fixed fee; or (ii) cost plus a fixed margin, which will vary depending on the nature of the services provided. We and EchoStar are able to terminate the TT&C Agreement for any reason upon 12 months’ notice. On May 19, 2019, we entered into a Master Transaction Agreement pursuant to which, on September 10, 2019, the assets and employees that provide these services were transferred to us. See above for further information on the Master Transaction Agreement. “Cost of sales – equipment and other” During the three months ended June 30, 2020 and 2019, we incurred $1 million and zero, respectively, for satellite hosting, operations and maintenance services as well as transmission of certain data. During the six months ended June 30, 2020 and 2019, we incurred $2 million and zero, respectively, for satellite hosting, operations and maintenance services as well as transmission of certain data. These amounts are recorded in “Cost of sales – equipment and other” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The agreements pertaining to these expenses are discussed below. DBSD North America Agreement. On March 9, 2012, we completed the DBSD Transaction. During the second quarter 2011, EchoStar acquired Hughes. Prior to our acquisition of DBSD North America and EchoStar’s acquisition of Hughes, DBSD North America and HNS entered into an agreement pursuant to which HNS provides, among other things, hosting, operations and maintenance services for DBSD North America’s satellite gateway and associated ground infrastructure. This agreement generally may be terminated by us at any time for convenience. TerreStar Agreement . On March 9, 2012, we completed the TerreStar Transaction. Prior to our acquisition of substantially all the assets of TerreStar and EchoStar’s acquisition of Hughes, TerreStar and HNS entered into various agreements pursuant to which HNS provides, among other things, hosting, operations and maintenance services for TerreStar’s satellite gateway and associated ground infrastructure. These agreements generally may be terminated by us at any time for convenience. Hughes Equipment and Services Agreement. In February 2019, we and HNS entered into an agreement pursuant to which HNS will provide us with HughesNet Service and HughesNet equipment for the transmission of certain data related to our 5G Network Deployment. This agreement has an initial term of five years with automatic renewal for successive one-year terms unless terminated by DISH Network with at least 180 days’ written notice to us or by us with at least 365 days’ written notice to DISH Network. “General and administrative expenses” During the three months ended June 30, 2020 and 2019, we incurred $3 million and $6 million, respectively, for general and administrative expenses for services provided to us by EchoStar. During the six months ended June 30, 2020 and 2019, we incurred $7 million and $11 million, respectively, for general and administrative expenses for services provided to us by EchoStar. These amounts are recorded in “General and administrative expenses” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The agreements pertaining to these expenses are discussed below. Real Estate Lease Agreements. We have entered into lease agreements pursuant to which we lease certain real estate from EchoStar. The rent on a per square foot basis for each of the leases is comparable to per square foot rental rates of similar commercial property in the same geographic area, and EchoStar is responsible for its portion of the taxes, insurance, utilities and maintenance of the premises. The term of each lease is set forth below: ● Meridian Lease Agreement. The lease for all of 9601 S. Meridian Blvd. in Englewood, Colorado was for a period ending on December 31, 2019. In December 2019, we and EchoStar amended this lease to, among other things, extend the term thereof for one additional year until December 31, 2020. ● Santa Fe Lease Agreement. The lease for all of 5701 S. Santa Fe Dr. in Littleton, Colorado was for a period ending on December 31, 2018. In December 2018, we and EchoStar amended this lease to, among other things, extend the term thereof for one additional year until December 31, 2019. On May 19, 2019, we entered into a Master Transaction Agreement pursuant to which, on September 10, 2019, this real estate was transferred to us. See above for further information on the Master Transaction Agreement. ● Cheyenne Lease Agreement. The lease for certain space at 530 EchoStar Drive in Cheyenne, Wyoming is for a period ending on December 31, 2031. In connection with the completion of the Share Exchange, EchoStar transferred ownership of a portion of this property to us, and, effective March 1, 2017, we and EchoStar amended this lease agreement to (i) terminate the lease of certain space at the portion of the property that was transferred to us and (ii) provide for the continued lease to us of certain space at the portion of the property that EchoStar retained. On May 19, 2019, we entered into a Master Transaction Agreement pursuant to which, on September 10, 2019, this real estate was transferred to us. See above for further information on the Master Transaction Agreement. ● 100 Inverness Lease Agreement . In connection with the completion of the Share Exchange, effective March 1, 2017, we lease certain space from EchoStar at 100 Inverness Terrace East, Englewood, Colorado for a period ending in December 2020. This agreement may be terminated by either party upon 180 days’ prior notice. Professional Services Agreement. Prior to 2010, in connection with the Spin-off, we entered into various agreements with EchoStar including the Transition Services Agreement, Satellite Procurement Agreement and Services Agreement, which all expired on January 1, 2010 and were replaced by a Professional Services Agreement. During 2009, we and EchoStar agreed that EchoStar shall continue to have the right, but not the obligation, to receive the following services from us, among others, certain of which were previously provided under the Transition Services Agreement: information technology, travel and event coordination, internal audit, legal, accounting and tax, benefits administration, program acquisition services and other support services. Additionally, we and EchoStar agreed that we shall continue to have the right, but not the obligation, to engage EchoStar to manage the process of procuring new satellite capacity for us (previously provided under the Satellite Procurement Agreement) and receive logistics, procurement and quality assurance services from EchoStar (previously provided under the Services Agreement) and other support services. The Professional Services Agreement renewed on January 1, 2020 for an additional one-year period until January 1, 2021 and renews automatically for successive one-year periods thereafter, unless terminated earlier by either party upon at least 60 days’ notice. However, either party may terminate the Professional Services Agreement in part with respect to any particular service it receives for any reason upon at least 30 days’ notice. In connection with the completion of the Share Exchange on February 28, 2017, DISH Network and EchoStar amended the Professional Services Agreement to, among other things, provide certain transition services to each other related to the Share Exchange Agreement. In addition, on May 19, 2019, we entered into a Master Transaction Agreement, pursuant to which, effective September 10, 2019, DISH Network and EchoStar amended the Professional Services Agreement to, among other things, provide certain transition services to each other related to the Master Transaction Agreement and to remove certain services no longer necessary as a result of the Master Transaction Agreement. See above for further information on the Master Transaction Agreement. During March 2020, we and EchoStar added a service under the Professional Services Agreement whereby we provide EchoStar with rights to use certain satellite capacity in exchange for certain credits to amounts owed by us to EchoStar under the TerreStar Agreement described above. Revenue for services provided by us to EchoStar under the Professional Services Agreement is recorded in “Equipment sales and other revenue” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). Other Agreements - EchoStar Tax Sharing Agreement. In connection with the Spin-off, we entered into a tax sharing agreement (the “Tax Sharing Agreement”) with EchoStar which governs our respective rights, responsibilities and obligations after the Spin-off with respect to taxes for the periods ending on or before the Spin-off. Generally, all pre-Spin-off taxes, including any taxes that are incurred as a result of restructuring activities undertaken to implement the Spin-off, are borne by us, and we will indemnify EchoStar for such taxes. However, we are not liable for and will not indemnify EchoStar for any taxes that are incurred as a result of the Spin-off or certain related transactions failing to qualify as tax-free distributions pursuant to any provision of Section 355 or Section 361 of the Internal Revenue Code of 1986, as amended (the “Code”) because of: (i) a direct or indirect acquisition of any of EchoStar’s stock, stock options or assets; (ii) any action that EchoStar takes or fails to take; or (iii) any action that EchoStar takes that is inconsistent with the information and representations furnished to the Internal Revenue Service (“IRS”) in connection with the request for the private letter ruling, or to counsel in connection with any opinion being delivered by counsel with respect to the Spin-off or certain related transactions. In such case, EchoStar is solely liable for, and will indemnify us for, any resulting taxes, as well as any losses, claims and expenses. The Tax Sharing Agreement will only terminate after the later of the full period of all applicable statutes of limitations, including extensions, or once all rights and obligations are fully effectuated or performed. In light of the Tax Sharing Agreement, among other things, and in connection with our consolidated federal income tax returns for certain tax years prior to and for the year of the Spin-off, during the third quarter 2013, we and EchoStar agreed upon a supplemental allocation of the tax benefits arising from certain tax items resolved in the course of the IRS’ examination of these consolidated tax returns. As a result, we agreed to pay EchoStar $84 million of the tax benefit we received or will receive. This resulted in a reduction of our recorded unreco |
Subsequent Events
Subsequent Events | 6 Months Ended |
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Subsequent Events | |
Subsequent Events | 14. Subsequent Events 7 3/8% Senior Notes due 2028 On July 1, 2020, we issued $1.0 billion aggregate principal amount of our 7 3/8% Senior Notes due July 1, 2028. Interest accrues at an annual rate of 7 3/8% and is payable semi-annually in cash, in arrears on January 1 and July 1 of each year, commencing on January 1, 2021. The 7 3/8% Senior Notes are redeemable, in whole or in part, at any time prior to July 1, 2023 at a redemption price equal to 100% of the principal amount plus a “make-whole” premium, as defined in the related indenture, together with accrued and unpaid interest. Prior to July 1, 2023, we may also redeem up to 35% of the 7 3/8% Senior Notes at a specified premium with the net cash proceeds from certain equity offerings or capital contributions. Our 7 3/8% Senior ● general unsecured senior obligations of DISH DBS Corporation (“DISH DBS”); ● ranked equally in right of payment with all of DISH DBS’ and the guarantors’ existing and future unsecured senior debt; and ● ranked effectively junior to our and the guarantors’ current and future secured senior indebtedness up to the value of the collateral securing such indebtedness. The indenture related to our 7 3/8% Senior Notes ● incur additional debt; ● pay dividends or make distributions on DISH DBS’ capital stock or repurchase DISH DBS’ capital stock; ● make certain investments; ● create liens or enter into sale and leaseback transactions; ● enter into transactions with affiliates; ● merge or consolidate with another company; and ● transfer or sell assets. In the event of a change of control, as defined in the related indenture, we would be required to make an offer to repurchase all or any part of a holder’s 7 3/8% |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and with the instructions to Form 10-Q and Article 10 of Regulation S-X for interim financial information. Accordingly, these statements do not include all of the information and notes required for complete financial statements prepared under GAAP. In our opinion, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Our results of operations for the interim periods presented are not necessarily indicative of the results that may be expected for the full year. For further information, refer to the Consolidated Financial Statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019. Certain prior period amounts have been reclassified to conform to the current period presentation. |
Principles of Consolidation | Principles of Consolidation We consolidate all majority owned subsidiaries, investments in entities in which we have controlling influence and variable interest entities where we have been determined to be the primary beneficiary. Minority interests are recorded as noncontrolling interests or redeemable noncontrolling interests. See below for further information. Non-consolidated investments are accounted for using the equity method when we have the ability to significantly influence the operating decisions of the investee. When we do not have the ability to significantly influence the operating decisions of an investee, these equity securities are classified as either marketable investment securities or other investments and recorded at fair value with changes recognized in “Other, net” within “Other Income (Expense)” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). All significant intercompany accounts and transactions have been eliminated in consolidation. |
Redeemable Noncontrolling Interests | Redeemable Noncontrolling Interests Northstar Wireless . Northstar Wireless is a wholly-owned subsidiary of Northstar Spectrum, which is an entity owned by Northstar Manager, LLC (“Northstar Manager”) and us. Under the applicable accounting guidance in ASC 810, Northstar Spectrum is considered a variable interest entity and, based on the characteristics of the structure of this entity and in accordance with the applicable accounting guidance, we consolidate Northstar Spectrum into our financial statements. The Northstar Operative Agreements, as amended, provide for, among other things, that after the fifth and sixth anniversaries of the grant of the AWS-3 Licenses to Northstar Wireless (and in certain circumstances, prior to the fifth anniversary of the grant of the AWS-3 Licenses to Northstar Wireless), Northstar Manager has the ability, but not the obligation, to require Northstar Spectrum to purchase Northstar Manager’s ownership interests in Northstar Spectrum (the “Northstar Put Right”) for a purchase price that equals its equity contribution to Northstar Spectrum plus a fixed annual rate of return. The fifth and sixth anniversaries of the grant of the AWS-3 Licenses to Northstar Wireless are in the fourth quarter 2020 and fourth quarter 2021, respectively. In the event that the Northstar Put Right is exercised by Northstar Manager, the consummation of the sale will be subject to FCC approval. Northstar Spectrum does not have a call right with respect to Northstar Manager’s ownership interests in Northstar Spectrum. Although Northstar Manager is the sole manager of Northstar Spectrum, Northstar Manager’s ownership interest is considered temporary equity under the applicable accounting guidance and is thus recorded as part of “Redeemable noncontrolling interests” in the mezzanine section of our Condensed Consolidated Balance Sheets. Northstar Manager’s ownership interest in Northstar Spectrum was initially accounted for at fair value. Subsequently, Northstar Manager’s ownership interest in Northstar Spectrum is increased by the fixed annual rate of return through “Redeemable noncontrolling interests” on our Condensed Consolidated Balance Sheets, with the offset recorded in “Net income (loss) attributable to noncontrolling interests, net of tax” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The operating results of Northstar Spectrum attributable to Northstar Manager are recorded as “Redeemable noncontrolling interests” on our Condensed Consolidated Balance Sheets, with the offset recorded in “Net income (loss) attributable to noncontrolling interests, net of tax” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 10 for further information. SNR Wireless . SNR Wireless is a wholly-owned subsidiary of SNR HoldCo, which is an entity owned by SNR Wireless Management, LLC (“SNR Management”) and us. Under the applicable accounting guidance in ASC 810, SNR HoldCo is considered a variable interest entity and, based on the characteristics of the structure of this entity and in accordance with the applicable accounting guidance, we consolidate SNR HoldCo into our financial statements. The SNR Operative Agreements, as amended, provide for, among other things, that after the fifth sixth anniversaries of the grant of the AWS-3 Licenses to SNR Wireless (and in certain circumstances, prior to the fifth anniversary of the grant of the AWS-3 Licenses to SNR Wireless), SNR Management has the ability, but not the obligation, to require SNR HoldCo to purchase SNR Management’s ownership interests in SNR HoldCo (the “SNR Put Right”) for a purchase price that equals its equity contribution to SNR HoldCo plus a fixed annual rate of return. The fifth and sixth anniversaries of the grant of the AWS-3 Licenses to SNR Wireless are in the fourth quarter 2020 and fourth quarter 2021, respectively. In the event that the SNR Put Right is exercised by SNR Management, the consummation of the sale will be subject to FCC approval. SNR HoldCo does not have a call right with respect to SNR Management’s ownership interests in SNR HoldCo. Although SNR Management is the sole manager of SNR HoldCo, SNR Management’s ownership interest is considered temporary equity under the applicable accounting guidance and is thus recorded as part of “Redeemable noncontrolling interests” in the mezzanine section of our Condensed Consolidated Balance Sheets. SNR Management’s ownership interest in SNR HoldCo was initially accounted for at fair value. Subsequently, SNR Management’s ownership interest in SNR HoldCo is increased by the fixed annual rate of return through “Redeemable noncontrolling interests” on our Condensed Consolidated Balance Sheets, with the offset recorded in “Net income (loss) attributable to noncontrolling interests, net of tax” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The operating results of SNR HoldCo attributable to SNR Management are recorded as “Redeemable noncontrolling interests” on our Condensed Consolidated Balance Sheets, with the offset recorded in “Net income (loss) attributable to noncontrolling interests, net of tax” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 10 for further information. As of June 30, 2020 and December 31, 2019, Northstar Manager’s ownership interest in Northstar Spectrum |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense for each reporting period. Estimates are used in accounting for, among other things, allowances for credit losses, self-insurance obligations, deferred taxes and related valuation allowances, uncertain tax positions, loss contingencies, fair value of financial instruments, fair value of options granted under our stock-based compensation plans, fair value of assets and liabilities acquired in business combinations, relative standalone selling prices of performance obligations, finance leases, asset impairments, estimates of future cash flows used to evaluate and recognize impairments, useful lives of property, equipment and intangible assets, independent third-party retailer incentives, programming expenses and subscriber lives. Economic conditions may increase the inherent uncertainty in the estimates and assumptions indicated above. Actual results may differ from previously estimated amounts, and such differences may be material to our condensed consolidated financial statements. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected prospectively in the period they occur. |
Marketable Investment Securities | Marketable Investment Securities All equity securities are carried at fair value, with changes in fair value recognized in “Other, net” within “Other Income (Expense)” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). All debt securities are classified as available-for-sale and are recorded at fair value. Historically, we reported temporary unrealized gains and losses as a separate component of “Accumulated other comprehensive income (loss)” within “Total stockholders’ equity (deficit),” net of related deferred income tax on our Condensed Consolidated Balance Sheets. Subsequent to the adoption of ASU 2016-13 Financial Instruments – Credit Losses, Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”) during the first quarter of 2020, we report the temporary unrealized gains and losses related to changes in market conditions of marketable debt securities as a separate component of “Accumulated other comprehensive income (loss)” within “Total stockholders’ equity (deficit),” net of related deferred income tax on our Condensed Consolidated Balance Sheets. The corresponding changes in the fair value of marketable debt securities, which are determined to be company specific credit losses are recorded in “Other, net” within “Other Income (Expense)” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). We evaluate our debt investment portfolio to determine whether declines in the fair value of these securities are related to credit loss. Management estimates credit losses on marketable debt securities utilizing a credit loss impairment model on a quarterly basis. We estimate the expected credit losses, measured over the contractual life of marketable debt securities considering relevant issuer specific factors, including, but not limited to, a decrease in credit ratings or an entities ability to pay. |
Trade Accounts Receivable | Trade Accounts Receivable Prior to January 1, 2020, management estimated the amount of allowance for doubtful accounts for potential non-collectability of accounts receivable based upon past collection experience and consideration of other relevant factors. Subsequent to January 1, 2020 due to the adoption of ASU 2016-13, trade accounts receivable are recorded at amortized cost less an allowance for expected credit losses that are not expected to be recovered. We maintain allowances for credit losses resulting from the expected failure or inability of our customers to make required payments. We recognize the allowance for expected credit losses at inception and reassess quarterly based on management’s expectation of the asset’s collectability. Management estimates credit losses on financial assets, including our trade accounts receivable, utilizing a current expected credit loss impairment model. We estimate the expected credit losses, measured over the contractual life of an asset considering relevant historical loss information, credit quality of the customer base, current economic conditions and forecasts of future economic conditions. In determining the allowance for credit losses, management groups similar types of financial assets with consistent risk characteristics. Pools identified by management include but are not limited to residential customers, commercial customers and advertising services. The risk characteristics of the financial asset portfolios are monitored by management and reviewed periodically. The forecasts for future economic conditions are based on several factors including, but not limited to, changes in the unemployment rate, external economic forecasts and current collection rates. Our estimates of the allowance for credit losses may not be indicative of our actual credit losses requiring additional charges to be incurred to reflect the actual amount collected. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets We review our long-lived assets and identifiable finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. For assets which are held and used in operations, the asset would be impaired if the carrying amount of the asset (or asset group) exceeded its undiscounted future net cash flows. Once an impairment is determined, the actual impairment recognized is the difference between the carrying amount and the fair value as estimated using one of the following approaches: income, cost and/or market. Assets which are to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. The carrying amount of a long-lived asset or asset group is considered impaired when the anticipated undiscounted cash flows from such asset or asset group is less than its carrying amount. In that event, a loss is recorded in “Impairment of long-lived assets” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) based on the amount by which the carrying amount exceeds the fair value of the long-lived asset or asset group. Fair value, using the income approach, is determined primarily using a discounted cash flow model that uses the estimated cash flows associated with the asset or asset group under review, discounted at a rate commensurate with the risk involved. Fair value, utilizing the cost approach, is determined based on the replacement cost of the asset reduced for, among other things, depreciation and obsolescence. Fair value, utilizing the market approach, benchmarks the fair value against the carrying amount. See Note 7 for further information. DBS Satellites . We currently evaluate our DBS satellite fleet for impairment as one asset group whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. We do not believe any triggering event has occurred which would indicate impairment as of June 30, 2020 or December 31, 2019. We will continue to monitor the DBS satellite fleet for indicators of impairment, including monitoring the impact of the COVID-19 pandemic on all aspects of our business. AWS-4 Satellites. We currently evaluate our AWS-4 satellite fleet for impairment whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. In light of, among other things, certain developments related to the Sprint-TMUS merger, during the first quarter 2020, we determined that revisions to the AWS-4 build-out deadlines were probable, which we determined to be a triggering event. Accordingly, we quantitatively assessed the value of the AWS-4 satellites (T1 and D1) and wrote down the fair value of the satellites to their estimated fair value of million non-cash impairment charge in “Impairment of long-lived assets” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). We did not believe any triggering event occurred which would indicate impairment as of December 31, 2019. See Note 7 for further information. Narrowband IoT network. As discussed in Note 10, we were in the process of deploying a narrowband IoT network. We paused work on the narrowband IoT deployment in October 2019. In light of, among other things, certain developments related to the Sprint-TMUS merger, during the first quarter 2020, we determined that the revision of certain of our build-out deadlines were probable. Based on this, we no longer intended to complete our narrowband IoT deployment, which we considered a triggering event. As such, during the first quarter 2020, we reviewed the capitalized costs of equipment, labor and other assets related to the narrowband IoT deployment, including our operating lease assets, and impaired those items that would not be utilized in our ongoing 5G Network Deployment, resulting in a million non-cash impairment charge in “Impairment of long-lived assets” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 7 and Note 8 for further information. Impairment of long-lived assets recorded during the first quarter 2020 consisted of the following: For the Six Months Ended June 30, 2020 (In thousands) T1 satellite $ 48,120 D1 satellite 55,000 Construction in progress related to narrowband IoT deployment 226,742 Operating lease assets related to narrowband IoT deployment 26,556 Impairment of long-lived assets $ 356,418 |
Capitalized Interest | Capitalized Interest We capitalize interest associated with the acquisition or construction of certain assets, including, among other things, our wireless spectrum licenses, build-out costs associated with our network deployment and satellites. Capitalization of interest begins when, among other things, steps are taken to prepare the asset for its intended use and ceases when the asset is ready for its intended use or when these activities are substantially suspended. We are currently preparing for the commercialization of our AWS-4, H Block, 700 MHz, 600 MHz and MVDDS wireless spectrum licenses, and interest expense related to their carrying amount is being capitalized. In addition, the FCC has granted certain AWS-3 Licenses to Northstar Wireless and to SNR Wireless, respectively, in which we have made certain non-controlling investments. Northstar Wireless and SNR Wireless are preparing for the commercialization of their AWS-3 Licenses and interest expense related to their carrying amount is also being capitalized. As the carrying amount of the licenses, discussed above, exceeded the carrying value of our long-term debt and finance lease obligations, materially all of our interest expense is being capitalized. |
Fair Value Measurements | Fair Value Measurements We determine fair value based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. Market or observable inputs are the preferred source of values, followed by unobservable inputs or assumptions based on hypothetical transactions in the absence of market inputs. We apply the following hierarchy in determining fair value: ● Level 1, defined as observable inputs being quoted prices in active markets for identical assets; ● Level 2, defined as observable inputs other than quoted prices included in Level 1, including quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar instruments in markets that are not active; and derivative financial instruments indexed to marketable investment securities; and ● Level 3, defined as unobservable inputs for which little or no market data exists, consistent with reasonably available assumptions made by other participants therefore requiring assumptions based on the best information available. As of June 30, 2020 and December 31, 2019, the carrying amount for cash and cash equivalents, trade accounts receivable (net of allowance for credit losses or net of allowance for doubtful accounts) and current liabilities (excluding the “Current portion of long-term debt and finance lease obligations”) was equal to or approximated fair value due to their short-term nature or proximity to current market rates. See Note 5 for the fair value of our marketable investment securities and derivative financial instruments. Fair values for our publicly traded debt securities are based on quoted market prices, when available. The fair values of private debt are based on, among other things, available trade information, and/or an analysis in which we evaluate market conditions, related securities, various public and private offerings, and other publicly available information. In performing this analysis, we make various assumptions regarding, among other things, credit spreads, and the impact of these factors on the value of the debt securities. See Note 9 for the fair value of our long-term debt. |
Revenue Recognition | Revenue Recognition Our revenue is primarily derived from Pay-TV programming services that we provide to our subscribers. We also generate revenue from equipment rental fees and other hardware related fees, including DVRs and fees from subscribers with multiple receivers; advertising services; fees earned from our in-home service operations; broadband services; warranty services; sales of digital receivers and related equipment to third-party pay-TV providers; satellite uplink and telemetry, tracking and control (“TT&C”) services; and revenue from in-home services. See Note 11 Our residential video subscribers contract for individual services or combinations of services, as discussed above, the majority of which are generally distinct and are accounted for as separate performance obligations. We consider our installations for first time DISH TV subscribers to be a service. However, since we provide a significant integration service combining the installation with programming services, we have concluded that the installation is not distinct from programming and thus the installation and programming services are accounted for as a single performance obligation. We generally satisfy these performance obligations and recognize revenue as the services are provided, for example as the programming is broadcast to subscribers, as this best represents the transfer of control of the services to the subscriber. In cases where a subscriber is charged certain nonrefundable upfront fees, those fees are generally considered to be material rights to the subscriber related to the subscriber’s option to renew without having to pay an additional fee upon renewal. These fees are deferred and recognized over the estimated period of time during which the fee remains material to the customer, which we estimate to be less than one year. Revenues arising from our in-home services that are separate from the initial installation, such as mounting a TV on a subscriber’s wall, are generally recognized when these services are performed. For our residential video subscribers, we have concluded that the contract term under Accounting Standard Codification Topic 606, Revenue from Contracts with Customers is one month and as a result the revenue recognized for these subscribers for a given month is equal to the amount billed in that month, except for certain nonrefundable upfront fees that are accounted for as material rights, as discussed above. Revenues from our advertising services are typically recognized as the advertisements are broadcast. Sales of equipment to subscribers or other third parties are recognized when control is transferred under the contract. Revenue from our commercial video subscribers typically follows the residential model described above, with the exception that the contract term for most of our commercial subscribers exceeds one month and can be multiple years in length. However, commercial subscribers typically do not receive time-limited discounts or free service periods and accordingly, while they may have multiple performance obligations, revenue is equal to the amount billed in a given month. Contract Balances The timing of revenue recognition generally differs from the timing of invoicing to customers. When revenue is recognized prior to invoicing, we record a receivable. When revenue is recognized subsequent to invoicing, we record deferred revenue. Our residential video subscribers are typically billed monthly, and the contract balances for those customers arise from the timing of the monthly billing cycle. We do not adjust the amount of consideration for financing impacts as we apply a practical expedient when we anticipate that the period between transfer of goods and services and eventual payment for those goods and services will be less than year. See Note 12 for further information, including balance and activity detail about our allowance for credit losses and deferred revenue related to contracts with subscribers. Assets Recognized Related to the Costs to Obtain a Contract with a Subscriber We recognize an asset for the incremental costs of obtaining a contract with a subscriber if we expect the benefit of those costs to be longer than one year. We have determined that certain sales incentive programs, including those with our independent third-party retailers, meet the requirements to be capitalized, and payments made under these programs are capitalized and amortized to expense over the estimated subscriber life. During the three months ended June 30, 2020 and 2019, we capitalized $44 million and $55 million, respectively, under these programs. The amortization expense related to these programs was $29 million and $17 million for the three months ended June 30, 2020 and 2019, respectively. During the six months ended June 30, 2020 and 2019, we capitalized million, respectively, under these programs. The amortization expense related to these programs was |
Leases | Leases We enter into operating and finance leases for, among other things, satellites, office space, warehouses and distribution centers, vehicles, wireless towers and other equipment. Our leases have remaining lease terms from one some renewal options options terminate within We determine if an arrangement is a lease and classify that lease as either an operating or finance lease at inception. Operating leases are included in “Operating lease assets,” “Other accrued expenses” and “Operating lease liabilities” on our Condensed Consolidated Balance Sheets. Finance leases are included in “Property and equipment, net,” “Current portion of long-term debt and finance lease obligations” and “Long-term debt and finance lease obligations, net of current portion” on our Condensed Consolidated Balance Sheets. Leases with an initial term of 12 months or less are not recorded on the balance sheet and we recognize lease expense for these leases on a straight-line basis over the lease term on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 8 for further information on our lease expenses. Right of use (“ROU”) assets represent our right to use an underlying asset for the lease term and lease liabilities represent the present value of our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. When our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The operating lease ROU asset also includes the impact of prepaid or deferred lease payments. The length of our lease term may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term. We currently lease and historically have leased certain assets from EchoStar, including, among other things, satellites, office space and data centers. See Note 13 for further information on our Related Party Transactions with EchoStar. On May 19, 2019, we entered into a Master Transaction Agreement with EchoStar and effective September 10, 2019, certain satellites and real estate assets leased from EchoStar were transferred to us. See Note 13 for further information on the Master Transaction Agreement. We have lease agreements with lease and non-lease components, which are generally accounted for separately. Our variable lease payments are immaterial and our lease agreements do not contain any material residual value guarantees or material restrictive covenants. DISH TV subscribers have the choice of leasing or purchasing the satellite receiver and other equipment necessary to receive our DISH TV services. Most of our new DISH TV subscribers choose to lease equipment and thus we retain title to such equipment. Equipment leased to new and existing DISH TV subscribers is capitalized and depreciated over their estimated useful lives. For equipment leased to new and existing DISH TV subscribers, we made an accounting policy election to combine the equipment with our programming services as a single performance obligation in accordance with the revenue recognition guidance as the programming services are the predominant component. The revenue related to equipment leased to new and existing DISH TV subscribers would have otherwise been accounted for as an operating lease. Impact of Adoption of ASU 2016-02 In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-02 Leases (“ASU 2016-02”) and has modified the standard thereafter. We adopted ASU 2016-02, as modified, on January 1, 2019 using the modified retrospective method. Under the modified retrospective method, we applied the new guidance to all leases that commenced before and were existing as of January 1, 2019. The adoption of ASU 2016-02 had no impact on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) and cash flows from operating, investing and financing activities on our Condensed Consolidated Statements of Cash Flows. |
Research and Development | Research and Development Research and development costs are expensed as incurred. Research and development costs totaled $ 5 million for the three months ended June 30, 2020 and 2019, respectively. Research and development costs totaled $11 million for each of the six months ended June 30, 2020 and 2019. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Summary of Significant Accounting Policies | |
Impairment of long-lived assets | For the Six Months Ended June 30, 2020 (In thousands) T1 satellite $ 48,120 D1 satellite 55,000 Construction in progress related to narrowband IoT deployment 226,742 Operating lease assets related to narrowband IoT deployment 26,556 Impairment of long-lived assets $ 356,418 |
Basic and Diluted Net Income _2
Basic and Diluted Net Income (Loss) Per Share (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Basic and Diluted Net Income (Loss) Per Share | |
Table presents EPS amounts for all periods and the basic and diluted weighted-average shares outstanding used in the calculation | For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 (In thousands, except per share amounts) Net income (loss) $ 480,406 $ 340,566 $ 579,680 $ 701,865 Less: Net income (loss) attributable to noncontrolling interests, net of tax 28,063 23,523 54,238 45,061 Net income (loss) attributable to DISH Network - Basic 452,343 317,043 525,442 656,804 Interest on dilutive Convertible Notes, net of tax (1) — — — — Net income (loss) attributable to DISH Network - Diluted $ 452,343 $ 317,043 $ 525,442 $ 656,804 Weighted-average common shares outstanding - Class A and B common stock: Basic (2) 524,292 469,655 523,722 468,809 Dilutive impact of Convertible Notes 58,192 58,192 58,192 58,192 Dilutive impact of stock awards outstanding 135 136 157 106 Diluted 582,619 527,983 582,071 527,107 Earnings per share - Class A and B common stock: Basic net income (loss) per share attributable to DISH Network $ 0.86 $ 0.68 $ 1.00 $ 1.40 Diluted net income (loss) per share attributable to DISH Network $ 0.78 $ 0.60 $ 0.90 $ 1.25 (1) For both the three and six months ended June 30, 2020 and 2019 , materially all of our interest expense was capitalized. See Note 2 for further information. (2) The increase resulted from the Master Transaction Agreement, as discussed in Note 13, and the stock rights offering as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2019. |
Schedule of dilutive securities not included in the diluted EPS calculation | As of June 30, 2020 2019 (In thousands) Anti-dilutive stock awards 6,570 5,115 Performance based options (1) 6,618 8,582 Restricted Performance Units/Awards (1) 1,146 1,589 Common stock warrants 46,029 46,029 Total 60,363 61,315 (1) The decrease primarily resulted from certain performance based options and Restricted Performance Units/Awards that vested during the three months ended June 30, 2020. |
Supplemental Data - Statement_2
Supplemental Data - Statements of Cash Flows (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Supplemental Data - Statements of Cash Flows | |
Schedule of supplemental cash flow and other non-cash data | For the Six Months Ended June 30, 2020 2019 (In thousands) Cash paid for interest (including capitalized interest) $ 404,158 $ 445,713 Cash received for interest 5,153 12,962 Cash paid for income taxes 4,294 18,350 Capitalized interest (1) 451,026 500,222 Employee benefits paid in Class A common stock 28,301 27,004 Reclassification of a receivable from noncurrent to current — 140,810 Tax impact of the CARES Act 97,256 — (1) See Note 2 for further information. |
Marketable Investment Securit_2
Marketable Investment Securities, Restricted Cash and Cash Equivalents, and Other Investment Securities (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Marketable Investment Securities, Restricted Cash and Cash Equivalents, and Other Investment Securities | |
Schedule of marketable investment securities, restricted cash and cash equivalents, and other investment securities | As of June 30, December 31, 2020 2019 (In thousands) Marketable investment securities: Current marketable investment securities: Strategic - available-for-sale $ 189 $ 196 Other 40,013 416,508 Total current marketable investment securities 40,202 416,704 Restricted marketable investment securities (1) — 390 Total marketable investment securities 40,202 417,094 Restricted cash and cash equivalents (1) 61,349 60,677 Other investment securities: Other investment securities 147,863 160,074 Total other investment securities 147,863 160,074 Total marketable investment securities, restricted cash and cash equivalents, and other investment securities $ 249,414 $ 637,845 (1) Restricted marketable investment securities and restricted cash and cash equivalents are included in “Restricted cash, cash equivalents and marketable investment securities” on our Condensed Consolidated Balance Sheets. |
Schedule of components of available-for-sale investments | As of June 30, As of December 31, 2020 2019 Marketable Marketable Investment Unrealized Investment Unrealized Securities Gains Losses Net Securities Gains Losses Net (In thousands) Debt securities (including restricted): U.S. Treasury and agency securities $ — $ — $ — $ — $ 10,016 $ 32 $ — $ 32 Commercial paper 40,000 — — — 369,397 2 — 2 Corporate securities — — — — 28,796 4 (1) 3 Other 202 — — — 8,885 58 — 58 Total $ 40,202 $ — $ — $ — $ 417,094 $ 96 $ (1) $ 95 |
Schedule of fair value measurements | As of June 30, 2020 December 31, 2019 Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 (In thousands) Cash equivalents (including restricted) $ 2,604,019 $ 1,833,706 $ 770,313 $ — $ 2,436,545 $ 246,876 $ 2,189,669 $ — Debt securities (including restricted): U.S. Treasury and agency securities $ — $ — $ — $ — $ 10,016 $ 10,016 $ — $ — Commercial paper 40,000 — 40,000 — 369,397 — 369,397 — Corporate securities — — — — 28,796 — 28,796 — Other 202 — 13 189 8,885 — 8,689 196 Total $ 40,202 $ — $ 40,013 $ 189 $ 417,094 $ 10,016 $ 406,882 $ 196 |
Schedule of gains and losses on sales and changes in carrying amounts of investments | For the Three Months Ended For the Six Months Ended June 30, June 30, Other, net: 2020 2019 2020 2019 (In thousands) Marketable investment securities - realized and unrealized gains (losses) $ 32 $ 838 $ 90 $ 3,894 Costs related to early redemption of debt — — — (439) Equity in earnings of affiliates (264) 2,056 603 991 Other 248 (62) 915 7,474 Total $ 16 $ 2,832 $ 1,608 $ 11,920 |
Inventory (Tables)
Inventory (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Inventory | |
Schedule of inventory | As of June 30, December 31, 2020 2019 (In thousands) Finished goods $ 263,533 $ 255,155 Work-in-process and service repairs 34,245 34,120 Raw materials 17,591 33,623 Total inventory $ 315,369 $ 322,898 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Property and Equipment | |
Schedule of property and equipment | Depreciable As of Life June 30, December 31, (In Years) 2020 2019 (In thousands) Equipment leased to customers 2 - 5 $ 1,799,429 $ 1,861,668 Satellites (1) 2 - 15 1,734,025 1,855,096 Satellites acquired under finance lease agreements 10 - 15 888,940 888,940 Furniture, fixtures, equipment and other 2 - 20 2,042,017 2,010,094 Buildings and improvements 5 - 40 354,274 349,347 Land - 17,810 17,810 Construction in progress (1) - 95,418 278,083 Total property and equipment 6,931,913 7,261,038 Accumulated depreciation (4,660,488) (4,554,856) Property and equipment, net $ 2,271,425 $ 2,706,182 (1) During the six months ended June 30, 2020, we wrote down the T1 satellite net book value of $48 million (net of accumulated depreciation of $18 million) and the D1 satellite net book value of $55 million to their estimated fair value of zero . In addition, during the six months ended June 30, 2020, we impaired $227 million for capitalized costs of equipment, labor and other assets related to the narrowband IoT deployment that would not be utilized in our 5G Network Deployment. As a result, we recorded a $ 330 million non-cash impairment charge in “Impairment of long-lived assets” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 2 for further information. |
Schedule of Construction in progress | As of June 30, December 31, 2020 2019 (In thousands) Software $ 48,862 $ 51,493 Wireless (1) 28,028 207,814 Other 18,528 18,776 Total construction in progress $ 95,418 $ 278,083 (1) During the six months ended June 30, 2020, we impaired the capitalized costs of equipment, labor and other assets related to the narrowband IoT deployment that would not be utilized in our 5G Network Deployment, resulting in a $227 million non-cash impairment charge in “Impairment of long-lived assets” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 2 for further information. |
Schedule of depreciation and amortization expense | For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 (In thousands) Equipment leased to customers $ 69,515 $ 86,865 $ 149,229 $ 196,019 Satellites (1) 50,193 17,156 102,337 37,635 Buildings, furniture, fixtures, equipment and other 32,416 45,681 67,378 69,187 Total depreciation and amortization $ 152,124 $ 149,702 $ 318,944 $ 302,841 (1) The increase resulted from the Master Transaction Agreement pursuant to which, on September 10, 2019, certain satellites were transferred to us. See Note 13 for further information. |
Schedule of pay-TV satellite fleet | Degree Lease Launch Orbital Termination Satellites Date Location Date Owned: EchoStar VII (1) February 2002 119 N/A EchoStar X (1) February 2006 110 N/A EchoStar XI (1) July 2008 110 N/A EchoStar XIV (1) March 2010 119 N/A EchoStar XV July 2010 61.5 N/A EchoStar XVI (1) November 2012 61.5 N/A EchoStar XVIII June 2016 61.5 N/A EchoStar XXIII (1) March 2017 67.9 N/A Leased from EchoStar (2): EchoStar IX August 2003 121 Month to month Leased from Other Third Party: Anik F3 April 2007 118.7 April 2022 Ciel II December 2008 129 January 2021 Nimiq 5 (1) September 2009 72.7 September 2024 QuetzSat-1 (1) September 2011 77 November 2021 (1) Pursuant to the Master Transaction Agreement, on September 10, 2019, these satellites and satellite service agreements were transferred to us. See Note 13 for further information. (2) See Note 13 for further information on our Related Party Transactions with EchoStar. |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Leases | |
Components of Lease Expense | For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 (In thousands) Operating lease cost (1) $ 18,118 $ 83,914 $ 35,849 $ 164,984 Short-term lease cost (2) 2,891 3,742 5,558 6,226 Finance lease cost: Amortization of right-of-use assets 17,755 3,805 35,659 9,913 Interest on lease liabilities 5,443 1,099 11,256 2,280 Total finance lease cost 23,198 4,904 46,915 12,193 Total lease costs $ 44,207 $ 92,560 $ 88,322 $ 183,403 (1) Pursuant to the Master Transaction Agreement, effective September 10, 2019, approximately $495 million of previously reported operating lease assets and the related liabilities for satellites and real estate assets were transferred to us. See Note 13 for further information. These satellite and real estate assets are no longer included in “Operating lease assets,” “Other current liabilities” and “Operating lease liabilities,” but rather in “Property and equipment, net” on our Condensed Consolidated Balance Sheets. Lease expense related to these satellites and real estate assets for the three and six months ended June 30, 2019 was $67 million and $134 million, respectively. (2) Leases that have terms of 12 months or less. |
Summary of Supplemental cash flow information related to leases | For the Six Months Ended June 30, 2020 2019 (In thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 35,977 $ 168,668 Operating cash flows from finance leases $ 11,256 $ 2,295 Financing cash flows from finance leases $ 31,181 $ 10,454 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 22,708 $ 89,554 Finance leases $ — $ — Right-of-use assets and liabilities recognized at January 1, 2019 upon adoption of ASC 842 $ 733,584 |
Summary of supplemental balance sheet information related to leases | As of June 30, December 31, 2020 2019 (In thousands) Operating Leases: Operating lease assets (1) $ 113,852 $ 144,330 Other current liabilities $ 58,625 $ 57,910 Operating lease liabilities 77,713 84,795 Total operating lease liabilities $ 136,338 $ 142,705 Finance Leases: Property and equipment, gross $ 889,708 $ 890,598 Accumulated depreciation (718,633) (683,271) Property and equipment, net $ 171,075 $ 207,327 Other current liabilities $ 64,501 $ 61,493 Other long-term liabilities 136,770 171,706 Total finance lease liabilities $ 201,271 $ 233,199 Weighted Average Remaining Lease Term: Operating leases 2.9 years 3.1 years Finance leases 3.4 years 3.8 years Weighted Average Discount Rate: Operating leases 4.6% 5.0% Finance leases 10.3% 10.2% (1) During the six months ended June 30, 2020, we impaired the operating lease assets related to the narrowband IoT deployment that would not be utilized in our 5G Network Deployment, resulting in a $27 million non-cash impairment charge in “Impairment of long-lived assets” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 2 for further information. |
Summary of maturities of operating lease liabilities | Maturities of Lease Liabilities Operating Finance For the Years Ending December 31, Leases Leases Total (In thousands) 2020 (remaining six months) $ 33,509 $ 37,765 $ 71,274 2021 55,402 82,610 138,012 2022 30,511 48,307 78,818 2023 13,498 40,942 54,440 2024 8,367 30,707 39,074 Thereafter 3,346 — 3,346 Total lease payments 144,633 240,331 384,964 Less: Imputed interest (8,295) (39,060) (47,355) Total 136,338 201,271 337,609 Less: Current portion (58,625) (64,501) (123,126) Long-term portion of lease obligations $ 77,713 $ 136,770 $ 214,483 |
Summary of maturities of finance lease liabilities | Maturities of lease liabilities as of June 30, 2020 : Maturities of Lease Liabilities Operating Finance For the Years Ending December 31, Leases Leases Total (In thousands) 2020 (remaining six months) $ 33,509 $ 37,765 $ 71,274 2021 55,402 82,610 138,012 2022 30,511 48,307 78,818 2023 13,498 40,942 54,440 2024 8,367 30,707 39,074 Thereafter 3,346 — 3,346 Total lease payments 144,633 240,331 384,964 Less: Imputed interest (8,295) (39,060) (47,355) Total 136,338 201,271 337,609 Less: Current portion (58,625) (64,501) (123,126) Long-term portion of lease obligations $ 77,713 $ 136,770 $ 214,483 |
Long-Term Debt and Finance Le_2
Long-Term Debt and Finance Lease Obligations (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Long-Term Debt and Finance Lease Obligations | |
Schedule of carrying and fair values of the entity's debt facilities | As of June 30, 2020 December 31, 2019 Carrying Fair Value Carrying Fair Value (In thousands) 5 1/8% Senior Notes due 2020 (1) $ — $ — $ 1,100,000 $ 1,110,208 6 3/4% Senior Notes due 2021 (2) 2,000,000 2,045,100 2,000,000 2,109,420 5 7/8% Senior Notes due 2022 2,000,000 2,043,040 2,000,000 2,129,580 5% Senior Notes due 2023 1,500,000 1,495,545 1,500,000 1,543,770 5 7/8% Senior Notes due 2024 2,000,000 2,000,340 2,000,000 2,049,080 2 3/8% Convertible Notes due 2024 1,000,000 895,980 1,000,000 918,720 7 3/4% Senior Notes due 2026 2,000,000 2,130,880 2,000,000 2,128,900 3 3/8% Convertible Notes due 2026 3,000,000 2,722,500 3,000,000 2,907,870 Other notes payable 67,298 67,298 70,946 70,946 Subtotal 13,567,298 $ 13,400,683 14,670,946 $ 14,968,494 Unamortized debt discount on the Convertible Notes (684,123) (735,811) Unamortized deferred financing costs and other debt discounts, net (25,184) (28,739) Finance lease obligations (3) 201,271 233,199 Total long-term debt and finance lease obligations (including current portion) $ 13,059,262 $ 14,139,595 (1) On May 1, 2020, we redeemed the principal balance of our 5 1/8% Senior Notes due 2020. (2) Our 6 3/4% Senior Notes due 2021 mature on June 1, 2021 and have been reclassified to “Current portion of long-term debt and finance lease obligations” on our Condensed Consolidated Balance Sheets as of June 30, 2020. (3) Disclosure regarding fair value of finance leases is not required. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies | |
Summary of Wireless Spectrum Licenses | As of June 30, 2020 Build-Out Deadlines Carrying Expiration Amount Interim Final Date (In thousands) Owned: DBS Licenses (1) $ 677,409 700 MHz Licenses 711,871 June 14, 2022 (2) June 14, 2023 (5) June 2023 AWS-4 Licenses 1,940,000 June 14, 2022 (2) June 14, 2023 (5) June 2023 H Block Licenses 1,671,506 June 14, 2022 (2) June 14, 2023 (5) June 2023 600 MHz Licenses 6,211,154 June 14, 2023 (3) June 14, 2025 (6) June 2029 MVDDS Licenses (1) 24,000 August 2024 LMDS Licenses (1) — September 2028 28 GHz Licenses 2,883 October 2, 2029 (7) October 2029 24 GHz Licenses 11,772 December 11, 2029 (7) December 2029 37 GHz, 30 GHz and 47 GHz Licenses 202,533 June 4, 2030 (7) June 2030 Subtotal 11,453,128 Non-controlling Investments: AWS-3 Licenses 9,890,389 October 2021 (4) October 2027 (8) October 2027 (8) Capitalized Interest 5,087,577 Total $ 26,431,094 (1) The build-out deadlines for these licenses have been met. (2) For these licenses, we are committed to offer 5G broadband service to at least 20% of the U.S. population and to have developed a core network by this date. (3) For these licenses, we are committed to offer 5G broadband service to at least 70% of the U.S. population and to have developed a core network by this date. (4) For these licenses, Northstar Wireless and SNR Wireless must provide reliable signal coverage and offer service to at least 40% of the population of each license area by this date. (5) For these licenses, we are committed to offer 5G broadband service to 70% of the U.S. population by this date. (6) For these licenses, we are committed to offer 5G broadband service to at least 75% of the population in each Partial Economic Area (which are service areas established by the FCC) by this date. (7) There are a variety of build-out options and associated build-out metrics associated with these licenses. (8) For these licenses, Northstar Wireless and SNR Wireless must provide reliable signal coverage and offer service to at least 75% of the population of each license area by this date. If the AWS-3 interim build-out requirement is not met, the AWS-3 expiration date and the AWS-3 final build-out requirement may be accelerated by two years (from October 2027 to October 2025) for each AWS-3 License area in which Northstar Wireless and SNR Wireless do not meet the requirement. |
Segment Reporting (Tables)
Segment Reporting (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting | |
Schedule of assets, revenue, and operating income by segment | As of June 30, December 31, 2020 2019 (In thousands) Total assets: Pay-TV $ 32,152,834 $ 31,531,612 Wireless 26,278,932 25,686,381 Eliminations (24,934,292) (23,987,058) Total assets $ 33,497,474 $ 33,230,935 For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 (In thousands) Revenue: Pay-TV $ 3,186,444 $ 3,211,836 $ 6,404,468 $ 6,400,005 Wireless 1,279 120 2,381 123 Eliminations (633) (644) (2,370) (1,672) Total revenue $ 3,187,090 $ 3,211,312 $ 6,404,479 $ 6,398,456 Operating income (loss): Pay-TV $ 693,511 $ 457,114 $ 1,235,153 $ 914,483 Wireless (1) (55,861) (26,382) (453,425) (27,451) Total operating income (loss) $ 637,650 $ 430,732 $ 781,728 $ 887,032 (1) The six months ended June 30, 2020 were negatively impacted by “Impairment of long-lived assets” of $356 million , resulting from non-cash impairments of the T1 satellite and D1 satellites, as well as capitalized costs of equipment, labor and other assets and operating lease assets related to the narrowband IoT deployment that would not be utilized in our 5G Network Deployment. See Note 2 for further information. |
Schedule of revenue by geographical region | For the Three Months Ended For the Six Months Ended June 30, June 30, Revenue: 2020 2019 2020 2019 (In thousands) United States $ 3,181,999 $ 3,200,541 $ 6,383,447 $ 6,376,794 Canada and Mexico 5,091 10,771 21,032 21,662 Total revenue $ 3,187,090 $ 3,211,312 $ 6,404,479 $ 6,398,456 |
Revenue from external customers disaggregated by major revenue source | For the Three Months Ended For the Six Months Ended June 30, June 30, Category: 2020 2019 2020 2019 (In thousands) Pay-TV video and related revenue $ 3,117,334 $ 3,117,065 $ 6,248,234 $ 6,215,001 Broadband revenue 32,479 45,507 67,620 95,341 Equipment sales and other revenue 37,277 48,740 88,625 88,114 Total $ 3,187,090 $ 3,211,312 $ 6,404,479 $ 6,398,456 |
Contract Balances (Tables)
Contract Balances (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Contract Balances | |
Summary of activity in the allowance for doubtful accounts | Allowance for credit losses Balance at Current Period Provision for Expected Credit Losses Write-offs Charged Against Allowance Balance at (In thousands) For the six months ended June 30, 2020 $ 19,280 $ 51,762 $ (21,974) $ 49,068 |
Schedule of changes in deferred revenue related to contracts with subscribers | Contract Liabilities (In thousands) Balance as of December 31, 2019 $ 613,272 Recognition of unearned revenue (2,995,089) Deferral of revenue 2,967,820 Balance as of June 30, 2020 $ 586,003 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
NagraStar | |
Schedule of transactions with related party | For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 (In thousands) Purchases (including fees): Purchases from NagraStar $ 13,259 $ 14,355 $ 27,351 $ 28,714 As of June 30, December 31, 2020 2019 (In thousands) Amounts Payable and Commitments: Amounts payable to NagraStar $ 17,930 $ 9,630 Commitments to NagraStar $ 4,159 $ 4,893 |
Dish Mexico | |
Schedule of transactions with related party | For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 (In thousands) Sales: Satellite capacity $ 5,463 $ — 10,925 — Uplink services 1,288 1,412 2,669 2,816 Total $ 6,751 $ 1,412 $ 13,594 $ 2,816 As of June 30, December 31, 2020 2019 (In thousands) Amounts Receivable: Amounts receivable from Dish Mexico $ 11,892 $ 7,057 |
Organization and Business Act_2
Organization and Business Activities (Details) $ / shares in Units, item in Thousands, $ in Thousands | Sep. 10, 2019 | Mar. 31, 2020USD ($) | Jun. 30, 2020USD ($)itemsegment$ / sharesshares | Jun. 30, 2020USD ($)item$ / shares | Dec. 31, 2019USD ($)$ / shares | May 19, 2019$ / shares |
Spectrum Investments | ||||||
Number of primary operating business units | segment | 2 | |||||
Number of Pay-TV subscribers | 11,272 | 11,272 | ||||
Common stock par value (in dollars per share) | $ / shares | $ 86.08 | $ 86.08 | ||||
Stockholders' Equity Note, Stock Split, Conversion Ratio | 0.23523769 | |||||
Payment to acquire certain wireless licenses and related assets | $ 21,000,000 | |||||
FCC authorizations | $ 26,431,094 | 26,431,094 | $ 25,779,503 | |||
Total debt and equity investments in subsidiaries | 10,000,000 | 10,000,000 | ||||
Impairment of long-lived assets | 356,418 | |||||
Non-cash impairment charge | $ 253,000 | 227,000 | ||||
Network Development Future Expenditures | 10,000,000 | |||||
Capitalized interest on FCC authorizations [Member] | ||||||
Spectrum Investments | ||||||
FCC authorizations | $ 5,000,000 | $ 5,000,000 | $ 5,000,000 | |||
Class A common stock | ||||||
Spectrum Investments | ||||||
Common stock par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | |||
Number of additional shares | shares | 22,937,188 | |||||
Class B common stock | ||||||
Spectrum Investments | ||||||
Common stock par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | |||
Maximum | ||||||
Spectrum Investments | ||||||
Wireless Projects Future Expenditures | $ 500,000 | |||||
Minimum | ||||||
Spectrum Investments | ||||||
Wireless Projects Future Expenditures | $ 250,000 | |||||
Sling TV Holding L.L.C. | ||||||
Spectrum Investments | ||||||
Number of Pay-TV subscribers | item | 2,255 | 2,255 | ||||
EchoStar | Master Transaction Agreement | Class A common stock | ||||||
Spectrum Investments | ||||||
Common stock par value (in dollars per share) | $ / shares | $ 0.001 | |||||
EchoStar | Master Transaction Agreement | Class B common stock | ||||||
Spectrum Investments | ||||||
Common stock par value (in dollars per share) | $ / shares | 0.001 | |||||
Newco | Master Transaction Agreement | ||||||
Spectrum Investments | ||||||
Common stock par value (in dollars per share) | $ / shares | $ 0.001 | |||||
Dish TV | ||||||
Spectrum Investments | ||||||
Number of Pay-TV subscribers | item | 9,017 | 9,017 | ||||
Wireless | ||||||
Spectrum Investments | ||||||
Payment to acquire certain wireless licenses and related assets | $ 11,000,000 | |||||
Northstar Spectrum And SNR Holdco | ||||||
Spectrum Investments | ||||||
Total debt and equity investments in subsidiaries | $ 10,000,000 | $ 10,000,000 |
Organization and Business Act_3
Organization and Business Activities - Asset Purchase Agreement (Details) $ in Millions | Apr. 01, 2020 | Jul. 26, 2019USD ($)item |
Asset Purchase Agreement | ||
Period in which at least 20% of population served to avoid payment of damages | 3 years | |
Number of spectrum bands | item | 4 | |
600 MHz Licenses | Not later than June 14, 2022 | Minimum | ||
Asset Purchase Agreement | ||
Percent Of Coverage On Available Licensed Geographic Areas | 70.00% | |
600 MHz Licenses | Not later than June 14, 2025 | Maximum | ||
Asset Purchase Agreement | ||
Percent Of Coverage On Available Licensed Geographic Areas | 75.00% | |
AWS-4 Licenses | Not later than June 14, 2022 | Minimum | ||
Asset Purchase Agreement | ||
Percent Of Coverage On Available Licensed Geographic Areas | 20.00% | |
AWS-4 Licenses | Not later than June 14, 2023 | Maximum | ||
Asset Purchase Agreement | ||
Percent Of Coverage On Available Licensed Geographic Areas | 70.00% | |
Lower 700 MHz E Block licenses | Not later than June 14, 2022 | Minimum | ||
Asset Purchase Agreement | ||
Percent Of Coverage On Available Licensed Geographic Areas | 20.00% | |
Lower 700 MHz E Block licenses | Not later than June 14, 2023 | Maximum | ||
Asset Purchase Agreement | ||
Percent Of Coverage On Available Licensed Geographic Areas | 70.00% | |
AWS H Block licenses | Not later than June 14, 2022 | Minimum | ||
Asset Purchase Agreement | ||
Percent Of Coverage On Available Licensed Geographic Areas | 20.00% | |
AWS H Block licenses | Not later than June 14, 2023 | Maximum | ||
Asset Purchase Agreement | ||
Percent Of Coverage On Available Licensed Geographic Areas | 70.00% | |
Asset Purchase Agreement | ||
Asset Purchase Agreement | ||
Purchase price | $ 1,400 | |
Spectrum Purchase Agreement | ||
Asset Purchase Agreement | ||
Purchase price | $ 3,590 | |
Option Agreement | ||
Asset Purchase Agreement | ||
Period after closing of prepaid business sale, transfer asset request is admissible | 1 year | |
Period within closing of prepaid business sale, required to offer nationwide postpaid retail mobile wireless service | 1 year | |
Period within entry of final judgment | 5 years | |
Percentage of purchase price | 10.00% | |
Percentage of population served | 20.00% | |
Period in which at least 20% of population served to avoid payment of damages | 3 years | |
Status of negotiation period | 90 days | |
Threshold period for involvement of DOJ | 180 days | |
Period obliged to provide DOJ with description of deployment efforts | 180 days | |
Term of final judgement from the date of its entry with the District Court. | 7 years | 7 years |
Term of final judgement if DOJ gives notice | 5 years | |
Damages To Be Paid In Case Of Breach Of Agreement | $ 360 | |
Spectrum Lease Period | 6 years | |
Option Agreement | AWS-4 Licenses | ||
Asset Purchase Agreement | ||
Damages To Be Paid In Case Of Breach Of Agreement | $ 2,200 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Accounting policy disclosures | ||||||
Capitalized Contract Cost | $ 44,000 | $ 55,000 | $ 82,000 | $ 92,000 | ||
Amortization expense related to the programs | 29,000 | 17,000 | 56,000 | 31,000 | ||
Total costs capitalized | 326,000 | $ 326,000 | $ 300,000 | |||
Revenue, Practical Expedient, Financing Component [true false] | true | |||||
Impairment of Long-Lived Assets | ||||||
Impairment of long-lived assets | $ 356,418 | |||||
Variable Interest Entity | ||||||
Redeemable noncontrolling interests | 605,815 | 605,815 | $ 552,075 | |||
Research and Development | ||||||
Research and development cost | $ 5,000 | $ 6,000 | $ 11,000 | $ 11,000 | ||
Leases | ||||||
Option to extend - Operating | true | |||||
Option to extend - Finance | true | |||||
Option to terminate period - Operating | 1 year | |||||
Option to terminate period - Finance | 1 year | |||||
Option to terminate - Operating | true | |||||
Option to terminate - Finance | true | |||||
Minimum | ||||||
Leases | ||||||
Option to extend period - Operating | 1 year | 1 year | ||||
Option to extend period - Finance | 1 year | 1 year | ||||
Maximum | ||||||
Leases | ||||||
Option to extend period - Operating | 7 years | 7 years | ||||
Option to extend period - Finance | 7 years | 7 years | ||||
NBIoT capitalized costs | ||||||
Impairment of Long-Lived Assets | ||||||
Impairment of long-lived assets | $ 253,000 | |||||
Northstar Manager LLC | Minimum | ||||||
Variable Interest Entity | ||||||
Number of years after wireless spectrum license is granted until put right vests | 5 years | |||||
Northstar Manager LLC | Maximum | ||||||
Variable Interest Entity | ||||||
Number of years after wireless spectrum license is granted until put right vests | 6 years | |||||
SNR Wireless Management LLC | Minimum | ||||||
Variable Interest Entity | ||||||
Number of years after wireless spectrum license is granted until put right vests | 5 years | |||||
SNR Wireless Management LLC | Maximum | ||||||
Variable Interest Entity | ||||||
Number of years after wireless spectrum license is granted until put right vests | 6 years | |||||
AWS-4 Satellites | ||||||
Accounting policy disclosures | ||||||
Fair value after write down | $ 0 | $ 0 | ||||
Impairment of Long-Lived Assets | ||||||
Impairment of long-lived assets | $ 103,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Impairment of Long-lived assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Mar. 31, 2020 | Jun. 30, 2020 | |
Impairment of long-lived assets | $ 356,418 | |
T1 | ||
Impairment of long-lived assets | 48,120 | |
D1 | ||
Impairment of long-lived assets | 55,000 | |
NBIoT capitalized costs | ||
Impairment of long-lived assets | $ 253,000 | |
NBIoT capitalized costs | Construction in progress | ||
Impairment of long-lived assets | 226,742 | |
NBIoT capitalized costs | Operating Lease Assets [Member] | ||
Impairment of long-lived assets | $ 26,556 |
Basic and Diluted Net Income _3
Basic and Diluted Net Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Basic and Diluted Net Income (Loss) Per Share | ||||||
Net income (loss) | $ 480,406 | $ 340,566 | $ 579,680 | $ 701,865 | ||
Less: Net income (loss) attributable to noncontrolling interests, net of tax | 28,063 | 23,523 | 54,238 | 45,061 | ||
Net income (loss) attributable to DISH Network | 452,343 | $ 73,099 | 317,043 | $ 339,761 | 525,442 | 656,804 |
Net income (loss) attributable to DISH Network - Diluted | $ 452,343 | $ 317,043 | $ 525,442 | $ 656,804 | ||
Weighted-average common shares outstanding - Class A and B common stock: | ||||||
Basic (2) (in shares) | 524,292 | 469,655 | 523,722 | 468,809 | ||
Dilutive impact of Convertible Notes (in shares) | 58,192 | 58,192 | 58,192 | 58,192 | ||
Dilutive impact of stock awards outstanding (in shares) | 135 | 136 | 157 | 106 | ||
Diluted (in shares) | 582,619 | 527,983 | 582,071 | 527,107 | ||
Earnings per share - Class A and B common stock: | ||||||
Basic net income (loss) per share attributable to DISH Network (in dollars per share) | $ 0.86 | $ 0.68 | $ 1 | $ 1.40 | ||
Diluted net income (loss) per share attributable to DISH Network (in dollars per share) | $ 0.78 | $ 0.60 | $ 0.90 | $ 1.25 |
Basic and Diluted Net Income _4
Basic and Diluted Net Income (Loss) Per Share - Performance based stock (Details) - $ / shares shares in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Antidilutive securities excluded from computation of earnings per share | ||
Anti-dilutive securities excluded from computation of earnings per share | 60,363 | 61,315 |
Strike price of the warrants | $ 86.08 | |
Anti-dilutive stock awards | ||
Antidilutive securities excluded from computation of earnings per share | ||
Anti-dilutive securities excluded from computation of earnings per share | 6,570 | 5,115 |
Performance based options | ||
Antidilutive securities excluded from computation of earnings per share | ||
Anti-dilutive securities excluded from computation of earnings per share | 6,618 | 8,582 |
Restricted Performance Units/Awards | ||
Antidilutive securities excluded from computation of earnings per share | ||
Anti-dilutive securities excluded from computation of earnings per share | 1,146 | 1,589 |
Common stock warrants | ||
Antidilutive securities excluded from computation of earnings per share | ||
Anti-dilutive securities excluded from computation of earnings per share | 46,029 | 46,029 |
Supplemental Data - Statement_3
Supplemental Data - Statements of Cash Flows (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | ||
Supplemental Data - Statements of Cash Flows | |||
Cash paid for interest (including capitalized interest) | $ 404,158 | $ 445,713 | |
Cash received for interest | 5,153 | 12,962 | |
Cash paid for income taxes | 4,294 | 18,350 | |
Capitalized interest (1) | [1] | 451,026 | 500,222 |
Employee benefits paid in Class A common stock | 28,301 | 27,004 | |
Reclassification of a receivable from noncurrent to current | $ 140,810 | ||
Tax impact of the CARES Act | $ 97,256 | ||
[1] | See Note 2 for further information. |
Marketable Investment Securit_3
Marketable Investment Securities, Restricted Cash and Cash Equivalents, and Other Investment Securities (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Marketable investment securities, restricted cash and other investment securities | ||
Strategic - available-for-sale | $ 189 | $ 196 |
Other | 40,202 | 416,704 |
Total marketable investment securities | 40,202 | 417,094 |
Restricted cash and cash equivalents (1) | 61,349 | 60,677 |
Total other investment securities | 147,863 | 160,074 |
Total marketable investment securities, restricted cash and cash equivalents, and other investment securities | 249,414 | 637,845 |
Other investment securities | ||
Marketable investment securities, restricted cash and other investment securities | ||
Other | 40,013 | 416,508 |
Other investment securities - equity method | $ 147,863 | 160,074 |
Restricted Marketable Investment Securities [Member] | ||
Marketable investment securities, restricted cash and other investment securities | ||
Total marketable investment securities | $ 390 |
Marketable Investment Securit_4
Marketable Investment Securities, Restricted Cash and Cash Equivalents, and Other Investment Securities - Narrative (Details) | 6 Months Ended | |
Jun. 30, 2020 | Feb. 28, 2017 | |
Commercial paper | Maximum | ||
Other investment securities: | ||
Debt term of Maturity | 365 days | |
Corporate securities | Maximum | ||
Other investment securities: | ||
Debt term of Maturity | 18 months | |
NagraStar | ||
Other investment securities: | ||
Ownership interest (as a percent) | 50.00% |
Marketable Investment Securit_5
Marketable Investment Securities, Restricted Cash and Cash Equivalents, and Other Investment Securities - Unrealized Gain (Losses) On Marketable Investment Securities (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Components of our available-for-sale investments | ||
Marketable Investment Securities | $ 40,202 | $ 417,094 |
Unrealized Gains (Losses) on Marketable Investment Securities | ||
Unrealized Gains | 96 | |
Unrealized Losses | (1) | |
Unrealized Gains Losses, Net | 95 | |
Accumulated net unrealized losses | ||
Accumulated net unrealized gain (loss), before tax, in accumulated other comprehensive income (loss) | 0 | (1,000) |
Accumulated net unrealized gain (loss), net of tax, in accumulated other comprehensive income (loss) | 0 | (1,000) |
Contractual maturities of restricted and non-restricted marketable investment securities | ||
Debt securities with contractual maturities within one year | 189 | 196 |
US Treasury and agency securities | ||
Components of our available-for-sale investments | ||
Marketable Investment Securities | 10,016 | |
Unrealized Gains (Losses) on Marketable Investment Securities | ||
Unrealized Gains | 32 | |
Unrealized Gains Losses, Net | 32 | |
Commercial paper | ||
Components of our available-for-sale investments | ||
Marketable Investment Securities | 40,000 | 369,397 |
Unrealized Gains (Losses) on Marketable Investment Securities | ||
Unrealized Gains | 2 | |
Unrealized Gains Losses, Net | 2 | |
Corporate securities | ||
Components of our available-for-sale investments | ||
Marketable Investment Securities | 28,796 | |
Unrealized Gains (Losses) on Marketable Investment Securities | ||
Unrealized Gains | 4 | |
Unrealized Losses | (1) | |
Unrealized Gains Losses, Net | 3 | |
Other | ||
Components of our available-for-sale investments | ||
Marketable Investment Securities | $ 202 | 8,885 |
Unrealized Gains (Losses) on Marketable Investment Securities | ||
Unrealized Gains | 58 | |
Unrealized Gains Losses, Net | $ 58 |
Marketable Investment Securit_6
Marketable Investment Securities, Restricted Cash and Cash Equivalents, and Other Investment Securities - Investments Measured at Fair Value On A Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Fair value of marketable securities | ||
Marketable Investment Securities | $ 40,202 | $ 417,094 |
US Treasury and agency securities | ||
Fair value of marketable securities | ||
Marketable Investment Securities | 10,016 | |
Commercial paper | ||
Fair value of marketable securities | ||
Marketable Investment Securities | 40,000 | 369,397 |
Corporate securities | ||
Fair value of marketable securities | ||
Marketable Investment Securities | 28,796 | |
Other | ||
Fair value of marketable securities | ||
Marketable Investment Securities | 202 | 8,885 |
Fair value measurements on recurring basis | ||
Fair value of marketable securities | ||
Cash Equivalents (including restricted) | 2,604,019 | 2,436,545 |
Total | 40,202 | 417,094 |
Fair value measurements on recurring basis | US Treasury and agency securities | ||
Fair value of marketable securities | ||
Marketable Investment Securities | 10,016 | |
Fair value measurements on recurring basis | Commercial paper | ||
Fair value of marketable securities | ||
Marketable Investment Securities | 40,000 | 369,397 |
Fair value measurements on recurring basis | Corporate securities | ||
Fair value of marketable securities | ||
Marketable Investment Securities | 28,796 | |
Fair value measurements on recurring basis | Other | ||
Fair value of marketable securities | ||
Marketable Investment Securities | 202 | 8,885 |
Fair value measurements on recurring basis | Level 1 | ||
Fair value of marketable securities | ||
Cash Equivalents (including restricted) | 1,833,706 | 246,876 |
Total | 10,016 | |
Fair value measurements on recurring basis | Level 1 | US Treasury and agency securities | ||
Fair value of marketable securities | ||
Marketable Investment Securities | 10,016 | |
Fair value measurements on recurring basis | Level 2 | ||
Fair value of marketable securities | ||
Cash Equivalents (including restricted) | 770,313 | 2,189,669 |
Total | 40,013 | 406,882 |
Fair value measurements on recurring basis | Level 2 | Commercial paper | ||
Fair value of marketable securities | ||
Marketable Investment Securities | 40,000 | 369,397 |
Fair value measurements on recurring basis | Level 2 | Corporate securities | ||
Fair value of marketable securities | ||
Marketable Investment Securities | 28,796 | |
Fair value measurements on recurring basis | Level 2 | Other | ||
Fair value of marketable securities | ||
Marketable Investment Securities | 13 | 8,689 |
Fair value measurements on recurring basis | Level 3 | ||
Fair value of marketable securities | ||
Total | 189 | 196 |
Fair value measurements on recurring basis | Level 3 | Other | ||
Fair value of marketable securities | ||
Marketable Investment Securities | $ 189 | $ 196 |
Marketable Investment Securit_7
Marketable Investment Securities, Restricted Cash and Cash Equivalents, and Other Investment Securities - Other Income Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Other Income (Expense) | ||||
Marketable investment securities - realized and unrealized gains (losses) | $ 32 | $ 838 | $ 90 | $ 3,894 |
Costs related to early redemption of debt | (439) | |||
Equity in earnings of affiliates | (264) | 2,056 | 603 | 991 |
Other | 248 | (62) | 915 | 7,474 |
Total | $ 16 | $ 2,832 | $ 1,608 | $ 11,920 |
Inventory (Details)
Inventory (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Inventory | ||
Finished goods | $ 263,533 | $ 255,155 |
Work-in-process and service repairs | 34,245 | 34,120 |
Raw materials | 17,591 | 33,623 |
Total inventory | $ 315,369 | $ 322,898 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Mar. 31, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | |
Property and equipment | |||
Total property and equipment | $ 6,931,913 | $ 7,261,038 | |
Accumulated depreciation | (4,660,488) | (4,554,856) | |
Property and equipment, net | 2,271,425 | 2,706,182 | |
Non-cash impairment charge | $ 253,000 | 227,000 | |
Equipment leased to customers | |||
Property and equipment | |||
Total property and equipment | $ 1,799,429 | 1,861,668 | |
Equipment leased to customers | Minimum | |||
Property and equipment | |||
Depreciable Life | 2 years | ||
Equipment leased to customers | Maximum | |||
Property and equipment | |||
Depreciable Life | 5 years | ||
D1 | |||
Property and equipment | |||
Property and equipment, net | $ 55,000 | ||
T1 | |||
Property and equipment | |||
Accumulated depreciation | (18,000) | ||
Property and equipment, net | 48,000 | ||
Satellites | |||
Property and equipment | |||
Total property and equipment | $ 1,734,025 | 1,855,096 | |
Satellites | Minimum | |||
Property and equipment | |||
Depreciable Life | 2 years | ||
Satellites | Maximum | |||
Property and equipment | |||
Depreciable Life | 15 years | ||
Satellites acquired under finance lease agreements | |||
Property and equipment | |||
Total property and equipment | $ 888,940 | 888,940 | |
Satellites acquired under finance lease agreements | Minimum | |||
Property and equipment | |||
Depreciable Life | 10 years | ||
Satellites acquired under finance lease agreements | Maximum | |||
Property and equipment | |||
Depreciable Life | 15 years | ||
Furniture, fixtures, equipment and other | |||
Property and equipment | |||
Total property and equipment | $ 2,042,017 | 2,010,094 | |
Furniture, fixtures, equipment and other | Minimum | |||
Property and equipment | |||
Depreciable Life | 2 years | ||
Furniture, fixtures, equipment and other | Maximum | |||
Property and equipment | |||
Depreciable Life | 20 years | ||
Buildings and improvements | |||
Property and equipment | |||
Total property and equipment | $ 354,274 | 349,347 | |
Buildings and improvements | Minimum | |||
Property and equipment | |||
Depreciable Life | 5 years | ||
Buildings and improvements | Maximum | |||
Property and equipment | |||
Depreciable Life | 40 years | ||
Land | |||
Property and equipment | |||
Total property and equipment | $ 17,810 | 17,810 | |
Construction in progress | |||
Property and equipment | |||
Total property and equipment | 95,418 | 278,083 | |
Construction in progress | Software | |||
Property and equipment | |||
Total property and equipment | 48,862 | 51,493 | |
Construction in progress | Wireless | |||
Property and equipment | |||
Total property and equipment | 28,028 | 207,814 | |
Construction in progress | Other | |||
Property and equipment | |||
Total property and equipment | $ 18,528 | $ 18,776 |
Property and Equipment - Deprec
Property and Equipment - Depreciation and Amortization (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Depreciation and amortization expense | ||||
Depreciation and amortization expense | $ 152,124 | $ 149,702 | $ 318,944 | $ 302,841 |
Equipment leased to customers | ||||
Depreciation and amortization expense | ||||
Depreciation and amortization expense | 69,515 | 86,865 | 149,229 | 196,019 |
Satellites | ||||
Depreciation and amortization expense | ||||
Depreciation and amortization expense | 50,193 | 17,156 | 102,337 | 37,635 |
Buildings, furniture, fixtures, equipment and other | ||||
Depreciation and amortization expense | ||||
Depreciation and amortization expense | $ 32,416 | $ 45,681 | $ 67,378 | $ 69,187 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020USD ($)item | Dec. 31, 2019USD ($) | |
Property and equipment | ||
Property and equipment, net | $ 2,271,425 | $ 2,706,182 |
Accumulated depreciation | 4,660,488 | $ 4,554,856 |
Impairment of long-lived assets | 356,418 | |
Wireless | ||
Property and equipment | ||
Impairment of long-lived assets | 227,000 | |
AWS-4 Satellites | ||
Property and equipment | ||
Impairment of long-lived assets | 103,000 | |
T1 | ||
Property and equipment | ||
Property and equipment, net | 48,000 | |
Accumulated depreciation | 18,000 | |
Impairment of long-lived assets | 48,120 | |
D1 | ||
Property and equipment | ||
Property and equipment, net | 55,000 | |
Impairment of long-lived assets | 55,000 | |
D1 and T1 | ||
Property and equipment | ||
Estimated fair value | 0 | |
Property Plant And Equipment Net [Member] | ||
Property and equipment | ||
Impairment of long-lived assets | $ 330,000 | |
EchoStar XVIII, including capitalized interest | ||
Property and equipment | ||
Number of satellites utilized in geostationary orbit approximately 22,300 miles above the equator | item | 13 | |
Owned Satellites | item | 8 | |
Number of satellites utilized under operating lease | item | 1 | |
Number of satellites utilized under capital lease | item | 4 |
Leases (Details)
Leases (Details) | 6 Months Ended |
Jun. 30, 2020 | |
Option to extend - Operating | true |
Option to extend - Finance | true |
Option to terminate period - Operating | 1 year |
Option to terminate period - Finance | 1 year |
Option to terminate - Operating | true |
Option to terminate - Finance | true |
Minimum | |
Option to extend period - Operating | 1 year |
Option to extend period - Finance | 1 year |
Maximum | |
Option to extend period - Operating | 7 years |
Option to extend period - Finance | 7 years |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | Sep. 10, 2019 | |
Leases | ||||||
Operating lease cost (1) | $ 18,118 | $ 83,914 | $ 35,849 | $ 164,984 | ||
Short-term lease cost (2) | 2,891 | 3,742 | 5,558 | 6,226 | ||
Amortization of right-of-use assets | 17,755 | 3,805 | 35,659 | 9,913 | ||
Interest on lease liabilities | 5,443 | 1,099 | 11,256 | 2,280 | ||
Total finance lease cost | 23,198 | 4,904 | 46,915 | 12,193 | ||
Total lease costs | 44,207 | 92,560 | 88,322 | 183,403 | ||
Operating lease assets | $ 113,852 | $ 113,852 | $ 144,330 | $ 495,000 | ||
Lease expense | $ 67,000 | $ 134,000 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Leases | ||
Operating cash flows from operating leases | $ 35,977 | $ 168,668 |
Operating cash flows from finance leases | 11,256 | 2,295 |
Financing cash flows from finance leases | 31,181 | 10,454 |
Operating leases | $ 22,708 | 89,554 |
Right-of-use assets and liabilities recognized upon adoption of ASC 842 | $ 733,584 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | Sep. 10, 2019 | |
Lessee, Lease, Description [Line Items] | ||||
Operating lease right-of-use assets | $ 113,852 | $ 144,330 | $ 495,000 | |
Other current liabilities | $ 58,625 | 57,910 | ||
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Deferred Long-term Liability Charges | |||
Operating lease liabilities | $ 77,713 | 84,795 | ||
Total | $ 136,338 | 142,705 | ||
Operating Lease, Liability, Statement of Financial Position [Extensible List] | us-gaap:OperatingLeaseLiabilityNoncurrent us-gaap:AccountsPayableCurrent | |||
Property and equipment, gross | $ 6,931,913 | 7,261,038 | ||
Accumulated depreciation | (4,660,488) | (4,554,856) | ||
Property and equipment, net | 2,271,425 | 2,706,182 | ||
Other current liabilities | 64,501 | 61,493 | ||
Other long-term liabilities | 136,770 | 171,706 | ||
Total | $ 201,271 | $ 233,199 | ||
Operating Lease, Weighted Average Remaining Lease Term | 2 years 10 months 24 days | 3 years 1 month 6 days | ||
Finance Lease, Weighted Average Remaining Lease Term | 3 years 4 months 24 days | 3 years 9 months 18 days | ||
Operating Lease, Weighted Average Discount Rate, Percent | 4.60% | 5.00% | ||
Finance Lease, Weighted Average Discount Rate, Percent | 10.30% | 10.20% | ||
Asset Impairment Charges | $ 356,418 | |||
Property and equipment [Member] | ||||
Lessee, Lease, Description [Line Items] | ||||
Property and equipment, gross | 889,708 | $ 890,598 | ||
Accumulated depreciation | (718,633) | (683,271) | ||
Property and equipment, net | 171,075 | $ 207,327 | ||
NBIoT capitalized costs | ||||
Lessee, Lease, Description [Line Items] | ||||
Asset Impairment Charges | $ 253,000 | |||
NBIoT capitalized costs | Operating Lease Assets [Member] | ||||
Lessee, Lease, Description [Line Items] | ||||
Asset Impairment Charges | $ 26,556 |
Leases - Maturities of Lease Li
Leases - Maturities of Lease Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Maturities of lease liabilities: Operating lease | ||
2020 (remaining six months) | $ 33,509 | |
2021 | 55,402 | |
2022 | 30,511 | |
2023 | 13,498 | |
2024 | 8,367 | |
Thereafter | 3,346 | |
Total lease payments | 144,633 | |
Less: Imputed interest | (8,295) | |
Total | 136,338 | $ 142,705 |
Less: Current portion | (58,625) | (57,910) |
Long-term portion of lease obligations | 77,713 | 84,795 |
Maturities of lease liabilities: Finance lease | ||
2020 (remaining six months) | 37,765 | |
2021 | 82,610 | |
2022 | 48,307 | |
2023 | 40,942 | |
2024 | 30,707 | |
Total lease payments | 240,331 | |
Less: Imputed interest | (39,060) | |
Total | 201,271 | 233,199 |
Less: Current portion | (64,501) | (61,493) |
Long-term portion of lease obligations | 136,770 | $ 171,706 |
Future minimum payments for total lease liabilities | ||
2020 (remaining six months) | 71,274 | |
2021 | 138,012 | |
2022 | 78,818 | |
2023 | 54,440 | |
2024 | 39,074 | |
Thereafter | 3,346 | |
Total lease payments | 384,964 | |
Less: Imputed interest | (47,355) | |
Total | 337,609 | |
Less: Current portion | (123,126) | |
Long-term portion of lease obligations | $ 214,483 |
Long-Term Debt and Finance Le_3
Long-Term Debt and Finance Lease Obligations - Fair Value of Long-Term Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Debt Instrument | ||
Carrying Value | $ 13,567,298 | $ 14,670,946 |
Fair Value | 13,400,683 | 14,968,494 |
Unamortized debt discount on the Convertible Notes | (684,123) | (735,811) |
Unamortized deferred financing costs and other debt discounts, net | (25,184) | (28,739) |
Finance lease obligations | 201,271 | 233,199 |
Total long-term debt and finance lease obligations (including current portion) | $ 13,059,262 | 14,139,595 |
5 1/8% Senior Notes due 2020 | ||
Debt Instrument | ||
Carrying Value | 1,100,000 | |
Fair Value | $ 1,110,208 | |
Interest rate (as a percent) | 5.125% | 5.125% |
6 3/4% Senior Notes due 2021 | ||
Debt Instrument | ||
Carrying Value | $ 2,000,000 | $ 2,000,000 |
Fair Value | $ 2,045,100 | $ 2,109,420 |
Interest rate (as a percent) | 6.75% | 6.75% |
5 7/8% Senior Notes due 2022 | ||
Debt Instrument | ||
Carrying Value | $ 2,000,000 | $ 2,000,000 |
Fair Value | $ 2,043,040 | $ 2,129,580 |
Interest rate (as a percent) | 5.875% | 5.875% |
5% Senior Notes due 2023 | ||
Debt Instrument | ||
Carrying Value | $ 1,500,000 | $ 1,500,000 |
Fair Value | $ 1,495,545 | $ 1,543,770 |
Interest rate (as a percent) | 5.00% | 5.00% |
5 7/8% Senior Notes due 2024 | ||
Debt Instrument | ||
Carrying Value | $ 2,000,000 | $ 2,000,000 |
Fair Value | $ 2,000,340 | $ 2,049,080 |
Interest rate (as a percent) | 5.875% | 5.875% |
2 3/8% Convertible Notes due 2024 | ||
Debt Instrument | ||
Carrying Value | $ 1,000,000 | $ 1,000,000 |
Fair Value | $ 895,980 | $ 918,720 |
Interest rate (as a percent) | 2.375% | 2.375% |
7 3/4% Senior Notes due 2026 | ||
Debt Instrument | ||
Carrying Value | $ 2,000,000 | $ 2,000,000 |
Fair Value | $ 2,130,880 | $ 2,128,900 |
Interest rate (as a percent) | 7.75% | 7.75% |
3 3/8% Convertible Notes due 2026 | ||
Debt Instrument | ||
Carrying Value | $ 3,000,000 | $ 3,000,000 |
Fair Value | $ 2,722,500 | $ 2,907,870 |
Interest rate (as a percent) | 3.375% | 3.375% |
Other notes payable | ||
Debt Instrument | ||
Carrying Value | $ 67,298 | $ 70,946 |
Fair Value | $ 67,298 | $ 70,946 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Thousands | Jul. 23, 2020item | Jul. 01, 2020 | Apr. 09, 2020USD ($) | Apr. 01, 2020 | Mar. 12, 2020USD ($)item | Oct. 22, 2019USD ($) | Jul. 26, 2019USD ($)item | Jun. 07, 2018USD ($) | Jun. 06, 2018 | Aug. 18, 2015USD ($) | Oct. 31, 2027 | Mar. 31, 2020USD ($) | Mar. 31, 2018USD ($)item | Jun. 30, 2020USD ($)itemstore | Jun. 30, 2020USD ($)item | Jun. 14, 2025 | Jun. 14, 2023 | Jun. 14, 2022 | Oct. 31, 2021 | Dec. 31, 2019USD ($) |
Spectrum Investments | ||||||||||||||||||||
Payment to acquire certain wireless licenses and related assets | $ 21,000,000 | |||||||||||||||||||
Carrying amount | $ 26,431,094 | 26,431,094 | ||||||||||||||||||
Percentage of Population 5G Services offered | 75.00% | 70.00% | 20.00% | 40.00% | ||||||||||||||||
Percentage of Population Northstar Wireless and SNR Wireless offered | 75.00% | |||||||||||||||||||
FCC authorizations | 26,431,094 | 26,431,094 | $ 25,779,503 | |||||||||||||||||
Period in which at least 20% of population served to avoid payment of damages | 3 years | |||||||||||||||||||
Number of spectrum bands | item | 4 | |||||||||||||||||||
Impairment of long-lived assets | 356,418 | |||||||||||||||||||
Commitments relating to AWS-3 Auction | ||||||||||||||||||||
Noncontrolling Interest in Variable Interest Entity | 10,000,000 | 10,000,000 | ||||||||||||||||||
Capitalized interest on FCC authorizations [Member] | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
FCC authorizations | $ 5,000,000 | $ 5,000,000 | 5,000,000 | |||||||||||||||||
Asset Purchase Agreement | ||||||||||||||||||||
Sprint Asset Acquisition | ||||||||||||||||||||
Purchase price | $ 1,400,000 | |||||||||||||||||||
Spectrum Purchase Agreement | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Period of spectrum divestiture extend | 60 days | |||||||||||||||||||
Sprint Asset Acquisition | ||||||||||||||||||||
Purchase price | $ 3,590,000 | |||||||||||||||||||
Option Agreement | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Period after closing of prepaid business sale, transfer asset request is admissible | 1 year | |||||||||||||||||||
Period within closing of prepaid business sale, required to offer nationwide postpaid retail mobile wireless service | 1 year | |||||||||||||||||||
Period within entry of final judgment | 5 years | |||||||||||||||||||
Damages To Be Paid In Case Of Breach Of Agreement | $ 360,000 | |||||||||||||||||||
Percentage of purchase price | 10.00% | |||||||||||||||||||
Percentage of population served | 20.00% | |||||||||||||||||||
Period in which at least 20% of population served to avoid payment of damages | 3 years | |||||||||||||||||||
Status of negotiation period | 90 days | |||||||||||||||||||
Threshold period for involvement of DOJ | 180 days | |||||||||||||||||||
Period obliged to provide DOJ with description of deployment efforts | 180 days | |||||||||||||||||||
Term of final judgement from the date of its entry with the District Court. | 7 years | 7 years | ||||||||||||||||||
Term of final judgement if DOJ gives notice | 5 years | |||||||||||||||||||
Spectrum Lease Period | 6 years | |||||||||||||||||||
Auction 105 [Member] | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Number Of Applicants | item | 271 | |||||||||||||||||||
MVDDS Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Carrying amount | $ 24,000 | 24,000 | ||||||||||||||||||
Wireless | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Payment to acquire certain wireless licenses and related assets | 11,000,000 | |||||||||||||||||||
Carrying amount | 11,453,128 | 11,453,128 | ||||||||||||||||||
H Block Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Carrying amount | 1,671,506 | 1,671,506 | ||||||||||||||||||
DBS Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Carrying amount | 677,409 | 677,409 | ||||||||||||||||||
700 MHz Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Carrying amount | 711,871 | 711,871 | ||||||||||||||||||
700 MHz Licenses | Maximum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Percent of coverage on available licensed geographic areas | 70.00% | |||||||||||||||||||
700 MHz Licenses | Minimum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Percent of coverage on available licensed geographic areas | 20.00% | |||||||||||||||||||
600 MHz Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Carrying amount | 6,211,154 | 6,211,154 | ||||||||||||||||||
600 MHz Licenses | Maximum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Percent of coverage on available licensed geographic areas | 75.00% | |||||||||||||||||||
600 MHz Licenses | Minimum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Percent of coverage on available licensed geographic areas | 70.00% | |||||||||||||||||||
28 GHz Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Carrying amount | 2,883 | 2,883 | ||||||||||||||||||
24 GHz Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Carrying amount | 11,772 | 11,772 | ||||||||||||||||||
37 Ghz, 30 Ghz and 47 Ghz Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Carrying amount | 202,533 | 202,533 | ||||||||||||||||||
Purchase price | $ 135,000 | $ 203,000 | ||||||||||||||||||
Number of wireless spectrum licenses | item | 2,651 | |||||||||||||||||||
37 Ghz And 39 Ghz Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Number Of Spectrum Licenses | item | 50 | |||||||||||||||||||
47 Ghz Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Number Of Spectrum Licenses | item | 2,601 | |||||||||||||||||||
AWS-3 Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Carrying amount | $ 9,890,389 | 9,890,389 | ||||||||||||||||||
Accerlarted Build Out Period | 2 years | |||||||||||||||||||
AWS-4 Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Carrying amount | $ 1,940,000 | 1,940,000 | ||||||||||||||||||
AWS H Block licenses | Maximum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Percent of coverage on available licensed geographic areas | 70.00% | |||||||||||||||||||
AWS H Block licenses | Minimum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Percent of coverage on available licensed geographic areas | 20.00% | |||||||||||||||||||
AWS-4 Satellites | Maximum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Percent of coverage on available licensed geographic areas | 70.00% | |||||||||||||||||||
AWS-4 Satellites | Minimum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Percent of coverage on available licensed geographic areas | 20.00% | |||||||||||||||||||
AWS-4 And 600 MHz | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
No Sale Agreement Period | 6 years | |||||||||||||||||||
Capitalized Interest [Member] | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Carrying amount | $ 5,087,577 | 5,087,577 | ||||||||||||||||||
NTM Network | Spectrum Purchase Agreement | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Spectrum lease back period | 2 years | |||||||||||||||||||
Northstar Spectrum And SNR Holdco | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Ownership interest | $ 606,000 | 606,000 | ||||||||||||||||||
Commitments relating to AWS-3 Auction | ||||||||||||||||||||
Noncontrolling Interest in Variable Interest Entity | $ 10,000,000 | $ 10,000,000 | ||||||||||||||||||
Northstar Spectrum And SNR Holdco | American III | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Number of wireless spectrum licenses | item | 244 | 244 | ||||||||||||||||||
Northstar Spectrum And SNR Holdco | AWS-3 Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Interim Build-out Requirement (as a percent) | 40.00% | |||||||||||||||||||
Final Build-out Requirement (as a percent) | 75.00% | |||||||||||||||||||
Accelerated period to meet Final Build-Out Requirement on failure to meet Interim Build-Out Requirement | 2 years | |||||||||||||||||||
Northstar Spectrum And SNR Holdco | SNR Licenses | ||||||||||||||||||||
Commitments relating to AWS-3 Auction | ||||||||||||||||||||
Percentage of bidding credit | 25.00% | |||||||||||||||||||
Northstar Wireless or Northstar Spectrum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Interim payment percentage | 15.00% | |||||||||||||||||||
Re-Auction payment | $ 1,892,000 | |||||||||||||||||||
Overpayment Of Interim Payment | $ 334,000 | |||||||||||||||||||
Northstar Wireless or Northstar Spectrum | Preferred Class A | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Ownership percentage | 100.00% | |||||||||||||||||||
Northstar Wireless or Northstar Spectrum | Class B common stock | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Ownership percentage | 85.00% | |||||||||||||||||||
Commitments relating to AWS-3 Auction | ||||||||||||||||||||
Controlling interest owned by other companies | 15.00% | |||||||||||||||||||
Northstar Wireless or Northstar Spectrum | Northstar Manager LLC | ||||||||||||||||||||
Commitments relating to AWS-3 Auction | ||||||||||||||||||||
Equity contribution | $ 133,000 | |||||||||||||||||||
Northstar Wireless or Northstar Spectrum | American II | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Loan made | $ 69,000 | |||||||||||||||||||
Window of days for management to put its interest | 90 days | 30 days | ||||||||||||||||||
Additional days allowed for management to put its interest | 90 days | |||||||||||||||||||
Commitments relating to AWS-3 Auction | ||||||||||||||||||||
Equity contribution | 7,621,000 | |||||||||||||||||||
Northstar Wireless or Northstar Spectrum | American II | Maximum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Preferred stock quarterly distribution (as a percent) | 12.00% | |||||||||||||||||||
Northstar Wireless or Northstar Spectrum | American II | Minimum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Preferred stock quarterly distribution (as a percent) | 8.00% | |||||||||||||||||||
Northstar Wireless or Northstar Spectrum | AWS 3 Auction | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Interim Payment | $ 334,000 | |||||||||||||||||||
Interim payment percentage | 15.00% | |||||||||||||||||||
Northstar Wireless or Northstar Spectrum | Northstar Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Number of wireless spectrum licenses | item | 261 | 261 | ||||||||||||||||||
Commitments relating to AWS-3 Auction | ||||||||||||||||||||
Gross winning bids | $ 5,619,000 | |||||||||||||||||||
Bidding credit value | $ 1,961,000 | |||||||||||||||||||
Northstar Wireless or Northstar Spectrum | AWS-3 Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Non-payment gross winning bids | 2,226,000 | $ 2,226,000 | ||||||||||||||||||
Commitments relating to AWS-3 Auction | ||||||||||||||||||||
Gross winning bids | $ 7,845,000 | |||||||||||||||||||
Percentage of bidding credit | 25.00% | |||||||||||||||||||
Net winning bid | $ 5,884,000 | |||||||||||||||||||
Number of licenses returned | item | 84 | |||||||||||||||||||
SNR Wireless or SNR Wireless Holdco | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Re-Auction payment | $ 1,029,000 | |||||||||||||||||||
Ownership interest | 552,000 | $ 552,000 | ||||||||||||||||||
Overpayment Of Interim Payment | $ 182,000 | |||||||||||||||||||
SNR Wireless or SNR Wireless Holdco | Preferred Class A | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Ownership percentage | 100.00% | |||||||||||||||||||
SNR Wireless or SNR Wireless Holdco | Class B common stock | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Ownership percentage | 85.00% | |||||||||||||||||||
Commitments relating to AWS-3 Auction | ||||||||||||||||||||
Controlling interest owned by other companies | 15.00% | |||||||||||||||||||
SNR Wireless or SNR Wireless Holdco | Maximum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Preferred stock quarterly distribution (as a percent) | 12.00% | |||||||||||||||||||
SNR Wireless or SNR Wireless Holdco | Minimum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Preferred stock quarterly distribution (as a percent) | 8.00% | |||||||||||||||||||
SNR Wireless or SNR Wireless Holdco | SNR Wireless Management LLC | ||||||||||||||||||||
Commitments relating to AWS-3 Auction | ||||||||||||||||||||
Equity contribution | 93,000 | |||||||||||||||||||
SNR Wireless or SNR Wireless Holdco | American III | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Loan made | $ 344,000 | |||||||||||||||||||
Debt outstanding amount | 5,065,000 | |||||||||||||||||||
Principal amount of debt | 500,000 | |||||||||||||||||||
Window of days for management to put its interest | 90 days | 30 days | ||||||||||||||||||
Additional days allowed for management to put its interest | 90 days | |||||||||||||||||||
Commitments relating to AWS-3 Auction | ||||||||||||||||||||
Equity contribution | $ 5,590,000 | |||||||||||||||||||
Gross winning bids | $ 4,271,000 | |||||||||||||||||||
SNR Wireless or SNR Wireless Holdco | American III | Preferred Class A | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Number shares issued in conversion | item | 5,065,415 | |||||||||||||||||||
Preferred stock quarterly distribution (as a percent) | 12.00% | |||||||||||||||||||
SNR Wireless or SNR Wireless Holdco | American III | Maximum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Interest rate (as a percent) | 12.00% | |||||||||||||||||||
SNR Wireless or SNR Wireless Holdco | American III | Minimum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Interest rate (as a percent) | 6.00% | 6.00% | ||||||||||||||||||
SNR Wireless or SNR Wireless Holdco | AWS 3 Auction | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Non-payment gross winning bids | $ 1,211,000 | $ 1,211,000 | ||||||||||||||||||
Commitments relating to AWS-3 Auction | ||||||||||||||||||||
Gross winning bids | 5,482,000 | |||||||||||||||||||
Net winning bid | 4,112,000 | |||||||||||||||||||
Bid withdrawal payment | 8,000 | |||||||||||||||||||
SNR Wireless or SNR Wireless Holdco | AWS-3 Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Non-payment gross winning bids | $ 1,211,000 | 1,211,000 | ||||||||||||||||||
SNR Wireless or SNR Wireless Holdco | AWS-3 Licenses | SNR Wireless Management LLC | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Interim payment percentage | 15.00% | |||||||||||||||||||
SNR Wireless or SNR Wireless Holdco | SNR Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Interim Payment | $ 182,000 | |||||||||||||||||||
Non-payment gross winning bids | 1,211,000 | 1,211,000 | ||||||||||||||||||
Additional Bid Withdrawal Payment | 3,000 | |||||||||||||||||||
Commitments relating to AWS-3 Auction | ||||||||||||||||||||
Bidding credit value | $ 1,370,000 | |||||||||||||||||||
Prior Arrangement | Northstar Licenses | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Non-payment gross winning bids | $ 2,226,000 | $ 2,226,000 | ||||||||||||||||||
Prior Arrangement | Northstar Spectrum And SNR Holdco | SNR Licenses | ||||||||||||||||||||
Commitments relating to AWS-3 Auction | ||||||||||||||||||||
Number of licenses returned | item | 113 | |||||||||||||||||||
Northstar Operative Agreement | Northstar Spectrum And SNR Holdco | American II | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Debt outstanding amount | $ 6,870,000 | |||||||||||||||||||
Northstar Operative Agreement | Northstar Wireless or Northstar Spectrum | American II | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Principal amount of debt | $ 500,000 | |||||||||||||||||||
Loan balance maturity period | 10 years | 7 years | ||||||||||||||||||
Removal of consent for unsecured financing and equipment financing | $ 25,000 | |||||||||||||||||||
Northstar Operative Agreement | Northstar Wireless or Northstar Spectrum | American II | Preferred Class A | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Number shares issued in conversion | item | 6,870,493 | |||||||||||||||||||
Preferred stock quarterly distribution (as a percent) | 12.00% | |||||||||||||||||||
Northstar Operative Agreement | Northstar Wireless or Northstar Spectrum | American II | Maximum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Interest rate (as a percent) | 12.00% | |||||||||||||||||||
Northstar Operative Agreement | Northstar Wireless or Northstar Spectrum | American II | Minimum | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Interest rate (as a percent) | 6.00% | |||||||||||||||||||
SNR Operative Agreement | SNR Wireless or SNR Wireless Holdco | American III | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Loan balance maturity period | 10 years | 7 years | ||||||||||||||||||
Removal of consent for unsecured financing and equipment financing | $ 25,000 | |||||||||||||||||||
Spectrum Purchase Agreement | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Period within which divesture to be completed after receipt of FCC approval | 3 years | |||||||||||||||||||
Threshold divesture deadline extension period | 5 days | |||||||||||||||||||
Spectrum lease back period | 3 years | |||||||||||||||||||
per-Pop rate | $ 68,000 | |||||||||||||||||||
Decrease in purchase price due to failure to complete rebanding activities | 72,000 | |||||||||||||||||||
Damages sought value in case of breach of agreement | $ 72,000 | |||||||||||||||||||
Transition Services Agreement | ||||||||||||||||||||
Sprint Asset Acquisition | ||||||||||||||||||||
Period after provisioning new or existing customers of prepaid business | 2 years | |||||||||||||||||||
Transition Services Agreement Provided At Cost Period | 2 years | |||||||||||||||||||
Master Network Service Agreement | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Service receipt period | 2 years | |||||||||||||||||||
Maximum Permitted Ownership Percent | 50.00% | |||||||||||||||||||
service pass through costs and out of pocket expenses charging period | 36 months | |||||||||||||||||||
Threshold Ownership Percentage Of Not Permitted Owners | 50.00% | |||||||||||||||||||
Percentage Of Wireless Communication Business Assets Are Sold | 50.00% | |||||||||||||||||||
Percentage Of Voting Power Or Economic Value Held By Restricted Persons | 50.00% | |||||||||||||||||||
Provision For New User After Change Of Control | 6 months | |||||||||||||||||||
Master Network Service Agreement Period | 7 years | |||||||||||||||||||
Option Agreement | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Number of cell sites | item | 20,000 | |||||||||||||||||||
Number of retail stores | store | 400 | |||||||||||||||||||
Period in which cell sites are scheduled to be decommissioned | 5 years | |||||||||||||||||||
Option agreement term | 5 years | |||||||||||||||||||
Period after closing of prepaid business sale, transfer asset request is admissible | 1 year | |||||||||||||||||||
Period within closing of prepaid business sale, required to offer nationwide postpaid retail mobile wireless service | 1 year | |||||||||||||||||||
Damages To Be Paid In Case Of Breach Of Agreement | $ 360,000 | |||||||||||||||||||
Percentage of purchase price | 10.00% | |||||||||||||||||||
Percentage of population served | 20.00% | |||||||||||||||||||
Status of negotiation period | 90 days | |||||||||||||||||||
Threshold period for involvement of DOJ | 180 days | |||||||||||||||||||
Period obliged to provide DOJ with description of deployment efforts | 180 days | |||||||||||||||||||
Spectrum Lease Period | 6 years | |||||||||||||||||||
Option Agreement | AWS-4 Satellites | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Damages To Be Paid In Case Of Breach Of Agreement | $ 2,200,000 | |||||||||||||||||||
FCC Wireless Bureau | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Purchase price | $ 68,000 | |||||||||||||||||||
NBIoT capitalized costs | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Impairment of long-lived assets | $ 253,000 | |||||||||||||||||||
SNR Credit Agreement | SNR Wireless or SNR Wireless Holdco | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Loan made | $ 500,000 | |||||||||||||||||||
Northstar Credit Agreement | Northstar Wireless or Northstar Spectrum | American II | ||||||||||||||||||||
Spectrum Investments | ||||||||||||||||||||
Loan made | $ 500,000 |
Commitments and Contingencies -
Commitments and Contingencies - Part 2 (Details) | Jun. 29, 2020USD ($) | Sep. 27, 2019USD ($) | Apr. 05, 2018USD ($) | Oct. 06, 2017USD ($) | May 22, 2017USD ($) | Sep. 23, 2016USD ($) | Sep. 22, 2016USD ($) | Aug. 18, 2015USD ($) | Dec. 23, 2013USD ($) | Dec. 31, 2016USD ($)item | Jun. 30, 2020USD ($) | Feb. 12, 2020USD ($) | Dec. 31, 2019USD ($) | Aug. 12, 2019patent | Jun. 05, 2017USD ($) |
Loss contingencies | |||||||||||||||
Asset Impairment Charges | $ 356,418,000 | ||||||||||||||
Network Development Future Expenditures | 10,000,000,000 | ||||||||||||||
Turner Network Sales, Inc. | |||||||||||||||
Loss contingency terms | |||||||||||||||
Claim amount | $ 159,000,000 | ||||||||||||||
Claimed interest | $ 24,000,000 | ||||||||||||||
Remaining claims, incremental exposure | $ 206,000,000 | ||||||||||||||
Payment For License Fee | $ 20,000,000 | ||||||||||||||
ClearPlay | |||||||||||||||
Loss contingency terms | |||||||||||||||
Claim amount | 543,000,000 | ||||||||||||||
Minimum | |||||||||||||||
Loss contingencies | |||||||||||||||
Wireless Projects Future Expenditures | 250,000,000 | ||||||||||||||
Maximum | |||||||||||||||
Loss contingencies | |||||||||||||||
Wireless Projects Future Expenditures | $ 500,000,000 | ||||||||||||||
Northstar Spectrum And SNR Holdco | AWS-3 Licenses | |||||||||||||||
Loss contingencies | |||||||||||||||
Interim Build-out Requirement (as a percent) | 40.00% | ||||||||||||||
Final Build-out Requirement (as a percent) | 75.00% | ||||||||||||||
Accelerated period to meet Final Build-Out Requirement on failure to meet Interim Build-Out Requirement | 2 years | ||||||||||||||
Northstar Spectrum And SNR Holdco | SNR Licenses | |||||||||||||||
Loss contingency terms | |||||||||||||||
Percentage Of Bidding Credit | 25.00% | ||||||||||||||
Northstar Wireless or Northstar Spectrum | AWS-3 Licenses | |||||||||||||||
Loss contingency terms | |||||||||||||||
Percentage Of Bidding Credit | 25.00% | ||||||||||||||
Northstar Wireless or Northstar Spectrum | AWS-3 Licenses | Vermont National Telephone Company | |||||||||||||||
Loss contingency terms | |||||||||||||||
Percentage Of Bidding Credit | 25.00% | ||||||||||||||
Recovery amount | $ 10,000,000,000 | ||||||||||||||
Bidding Credit | $ 3,300,000,000 | ||||||||||||||
Northstar Wireless or Northstar Spectrum | AWS-3 Licenses | Minimum | Vermont National Telephone Company | |||||||||||||||
Loss contingency terms | |||||||||||||||
Claim amount | $ 5,500 | ||||||||||||||
Northstar Wireless or Northstar Spectrum | AWS-3 Licenses | Maximum | Vermont National Telephone Company | |||||||||||||||
Loss contingency terms | |||||||||||||||
Claim amount | $ 11,000 | ||||||||||||||
Northstar Wireless or Northstar Spectrum | Northstar Licenses | |||||||||||||||
Loss contingency terms | |||||||||||||||
Bidding Credit | $ 1,961,000,000 | ||||||||||||||
SNR Wireless or SNR Wireless Holdco | SNR Licenses | |||||||||||||||
Loss contingency terms | |||||||||||||||
Bidding Credit | $ 1,370,000,000 | ||||||||||||||
Telemarketing Litigation | |||||||||||||||
Loss contingencies | |||||||||||||||
Period of injunctive relief sought from placing any outbound telemarketing calls to market or promote its goods or services | 5 years | ||||||||||||||
Period barred from making outbound telemarketing calls | 2 years | ||||||||||||||
Number Of Telemarketing Calls | item | 51,119 | ||||||||||||||
Litigation Per Call Damages | $ 400 | ||||||||||||||
Krakauer Action | |||||||||||||||
Loss contingencies | |||||||||||||||
Third party number of call made in case trebled damages per call | $ 1,200 | ||||||||||||||
Settlement amount awarded to other party | $ 61,000,000 | ||||||||||||||
Krakauer Action | Other Accrued Expense | |||||||||||||||
Loss contingencies | |||||||||||||||
Litigation accrual | $ 61,000,000 | ||||||||||||||
Judicial Ruling | Krakauer Action | |||||||||||||||
Loss contingency terms | |||||||||||||||
Claim amount | $ 10,760,000 | ||||||||||||||
Mobile Networking Solutions [Member] | |||||||||||||||
Loss contingency terms | |||||||||||||||
Number Of Patents | patent | 2 | ||||||||||||||
DISH Network L.L.C. | Telemarketing Litigation | |||||||||||||||
Loss contingencies | |||||||||||||||
Damages awarded to state and federal plaintiff | $ 280,000,000 | ||||||||||||||
Loss contingency terms | |||||||||||||||
Claim amount | $ 270,000,000 | ||||||||||||||
DISH Network L.L.C. | Telemarketing Litigation | Other Accrued Expense | |||||||||||||||
Loss contingencies | |||||||||||||||
Litigation accrual | $ 280,000,000 | $ 280,000,000 |
Segment Reporting (Details)
Segment Reporting (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2020USD ($)segment | Jun. 30, 2019USD ($) | Dec. 31, 2019USD ($) | |
Segment information | ||||||
Number of primary operating business units | segment | 2 | |||||
Total assets | $ 33,497,474 | $ 33,497,474 | $ 33,230,935 | |||
Revenues | 3,187,090 | $ 3,211,312 | 6,404,479 | $ 6,398,456 | ||
Operating income (loss) | 637,650 | 430,732 | 781,728 | 887,032 | ||
Non-cash impairment charge | $ 253,000 | 227,000 | ||||
Asset Impairment Charges | 356,418 | |||||
United States | ||||||
Segment information | ||||||
Revenues | 3,181,999 | 3,200,541 | 6,383,447 | 6,376,794 | ||
Canada And Mexico | ||||||
Segment information | ||||||
Revenues | 5,091 | 10,771 | 21,032 | 21,662 | ||
Pay-TV | Operating segment | ||||||
Segment information | ||||||
Total assets | 32,152,834 | 32,152,834 | 31,531,612 | |||
Revenues | 3,186,444 | 3,211,836 | 6,404,468 | 6,400,005 | ||
Operating income (loss) | 693,511 | 457,114 | 1,235,153 | 914,483 | ||
Wireless | Operating segment | ||||||
Segment information | ||||||
Total assets | 26,278,932 | 26,278,932 | 25,686,381 | |||
Revenues | 1,279 | 120 | 2,381 | 123 | ||
Operating income (loss) | (55,861) | (26,382) | (453,425) | (27,451) | ||
All Other and Eliminations | Other and Eliminations | ||||||
Segment information | ||||||
Total assets | (24,934,292) | (24,934,292) | $ (23,987,058) | |||
Revenues | (633) | (644) | (2,370) | (1,672) | ||
Pay-TV video and related revenue | ||||||
Segment information | ||||||
Revenues | 3,117,334 | 3,117,065 | 6,248,234 | 6,215,001 | ||
Broadband revenue | ||||||
Segment information | ||||||
Revenues | 32,479 | 45,507 | 67,620 | 95,341 | ||
Equipment sales and other revenue | ||||||
Segment information | ||||||
Revenues | $ 37,277 | $ 48,740 | $ 88,625 | $ 88,114 |
Contract Balances - Valuation A
Contract Balances - Valuation And Qualifying Accounts Activity (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2020USD ($) | |
Contract Balances | |
Allowance for Doubtful Accounts Receivable, Beginning Balance | $ 19,280 |
Charged to Costs and Expenses | 51,762 |
Deductions | (21,974) |
Allowance for Doubtful Accounts Receivable, Ending Balance | $ 49,068 |
Contract Balances - Deferred Re
Contract Balances - Deferred Revenues (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2020USD ($) | |
Contract Balances | |
Balance at Beginning of Period | $ 613,272 |
Recognition of unearned revenue | (2,995,089) |
Deferral of revenue | 2,967,820 |
Balance at End of Period | $ 586,003 |
Related Party Transactions (Det
Related Party Transactions (Details) | Aug. 19, 2016 | Oct. 02, 2012 | Sep. 30, 2019item | Feb. 28, 2019 | Mar. 31, 2017 | Jul. 31, 2016 | Dec. 21, 2012 | Jan. 31, 2012item | Dec. 31, 2011USD ($) | Jun. 30, 2020USD ($)item | Jun. 30, 2019USD ($) | Mar. 31, 2013item | Jun. 30, 2020USD ($)item | Jun. 30, 2019USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2011USD ($) | Dec. 31, 2009item | Dec. 31, 2008item |
Related Party Transactions | ||||||||||||||||||
Trade accounts receivable | $ 531,827,000 | $ 531,827,000 | $ 588,358,000 | |||||||||||||||
Trade accounts payable | 372,266,000 | 372,266,000 | 280,645,000 | |||||||||||||||
Subscriber-related expenses | 199,724,000 | $ 238,078,000 | 453,597,000 | $ 431,977,000 | ||||||||||||||
Satellite and transmission expenses | 71,406,000 | 138,008,000 | 146,258,000 | 277,509,000 | ||||||||||||||
Cost of sales - equipment and other | 29,319,000 | 51,073,000 | 71,029,000 | 91,457,000 | ||||||||||||||
General and Administrative Expense | 212,124,000 | 202,758,000 | 431,096,000 | 401,672,000 | ||||||||||||||
Noncontrolling interests | 32,000 | 32,000 | (449,000) | |||||||||||||||
Net book value of asset | $ 26,431,094,000 | $ 26,431,094,000 | ||||||||||||||||
Maximum | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Additional renewal option | 7 years | 7 years | ||||||||||||||||
Minimum | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Additional renewal option | 1 year | 1 year | ||||||||||||||||
Collocation And Antenna Space Agreements | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Term of renewal option | 1 year | |||||||||||||||||
Collocation And Antenna Space Agreements | Maximum | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Notice period for termination of agreement | 120 days | |||||||||||||||||
Collocation And Antenna Space Agreements | Minimum | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Notice period for termination of agreement | 90 days | |||||||||||||||||
Professional Services Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Automatic Renewal Period | 1 year | |||||||||||||||||
Rovi License Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Payments to third party | $ 0 | |||||||||||||||||
Hughes Broadband Distribution Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Term of renewal option | 1 year | |||||||||||||||||
Hughes Broadband Distribution Agreement | Minimum | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Term of renewal option | 180 days | |||||||||||||||||
Hughes Broadband Master Services Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Payments to third party by related party under extension option | $ 5,000,000 | 5,000,000 | 9,000,000 | 11,000,000 | ||||||||||||||
TT & C Agreement [Member] | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Term of renewal option | 1 year | |||||||||||||||||
Minimum required notice period for termination of agreement by related party | 12 months | |||||||||||||||||
Renewal notice period prior to agreement expiration | 90 days | |||||||||||||||||
EchoStar | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Trade accounts receivable | 4,000,000 | 4,000,000 | 1,000,000 | |||||||||||||||
Trade accounts payable | 25,000,000 | 25,000,000 | $ 10,000,000 | |||||||||||||||
Equipment sales and other revenue | 2,000,000 | 1,000,000 | 4,000,000 | 3,000,000 | ||||||||||||||
Subscriber-related expenses | 4,000,000 | 7,000,000 | 9,000,000 | 14,000,000 | ||||||||||||||
Satellite and transmission expenses | 1,000,000 | 73,000,000 | 2,000,000 | 146,000,000 | ||||||||||||||
General and Administrative Expense | $ 3,000,000 | 6,000,000 | $ 7,000,000 | 11,000,000 | ||||||||||||||
EchoStar | El Paso Lease Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Number of consecutive three year renewal options | item | 4 | |||||||||||||||||
Term of renewal option | 3 years | |||||||||||||||||
EchoStar | 90 Inverness Lease Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Number of consecutive three year renewal options | item | 4 | |||||||||||||||||
Term of renewal option | 3 years | |||||||||||||||||
EchoStar | Cheyenne Lease Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Number of one year renewal options | item | 12 | 12 | ||||||||||||||||
Term of renewal option | 1 year | |||||||||||||||||
EchoStar | American Fork Occupancy License Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Term of renewal option | 5 years | |||||||||||||||||
EchoStar | Collocation And Antenna Space Agreements | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Number of renewal options | item | 4 | |||||||||||||||||
Term of renewal option | 3 years | |||||||||||||||||
Minimum required notice period for termination of agreement by related party | 180 days | |||||||||||||||||
EchoStar | EchoStar XVI | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Term of renewal option | 5 years | |||||||||||||||||
Agreement term | 4 years | |||||||||||||||||
Extension of initial term | 1 year | |||||||||||||||||
Additional term of renewal option | 5 years | |||||||||||||||||
EchoStar | Nimiq 5 Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Agreement term | 15 years | |||||||||||||||||
Number of DBS transponders available to receive services | item | 32 | |||||||||||||||||
EchoStar | DISH Nimiq 5 Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Agreement term | 10 years | |||||||||||||||||
Number of DBS transponders currently used | item | 32 | |||||||||||||||||
EchoStar | QuetzSat-1 Lease Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Agreement term | 10 years | |||||||||||||||||
Number of DBS transponders available to receive services | item | 32 | |||||||||||||||||
EchoStar | QuetzSat-1 Transponder Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Number of DBS transponders currently used | item | 24 | |||||||||||||||||
Number of transponders subleased | item | 5 | |||||||||||||||||
EchoStar | 2012 TT&C Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Number of one year renewal options | item | 4 | |||||||||||||||||
Extension of initial term | 1 year | |||||||||||||||||
Minimum required notice period for termination by the reporting entity | 12 months | |||||||||||||||||
EchoStar | Meridian Lease Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Additional term of renewal option | 1 year | |||||||||||||||||
EchoStar | Santa Fe Lease Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Additional term of renewal option | 1 year | |||||||||||||||||
EchoStar | 100 Inverness Lease Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Notice period for termination of agreement | 180 days | |||||||||||||||||
EchoStar | Professional Services Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Agreement term | 1 year | |||||||||||||||||
Minimum notice period for termination of a specific service | 30 days | |||||||||||||||||
EchoStar | Professional Services Agreement | Minimum | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Notice period for termination of agreement | 60 days | |||||||||||||||||
EchoStar | Patent Cross-License Agreements | Maximum | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Payments to third party | $ 10,000,000 | |||||||||||||||||
Payments to third party by related party under extension option | $ 3,000,000 | |||||||||||||||||
EchoStar | Rovi License Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Agreement term | 10 years | |||||||||||||||||
EchoStar | Tax Sharing Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Net amount of the allocated tax attributes payable | $ 84,000,000 | $ 84,000,000 | ||||||||||||||||
HNS | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Broadband equipment purchased from related parties | 3,000,000 | 3,000,000 | 7,000,000 | 8,000,000 | ||||||||||||||
HNS | Collocation And Antenna Space Agreements | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Number of renewal options | item | 4 | |||||||||||||||||
Term of renewal option | 3 years | |||||||||||||||||
Antenna space and power term | 5 years | |||||||||||||||||
HNS | Collocation And Antenna Space Agreements | Maximum | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Notice period for termination of agreement | 120 days | |||||||||||||||||
HNS | Collocation And Antenna Space Agreements | Minimum | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Notice period for termination of agreement | 90 days | |||||||||||||||||
HNS | Hughes Broadband Sales Agency Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Notice period for termination of agreement | 90 days | |||||||||||||||||
Agreement term | 5 years | |||||||||||||||||
Automatic Renewal Period | 1 year | |||||||||||||||||
HNS | Hughes Equipment and Services Agreement | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Term of renewal option | 1 year | |||||||||||||||||
Minimum required notice period for termination of agreement by related party | 180 days | |||||||||||||||||
Agreement term | 5 years | |||||||||||||||||
Minimum required notice period for termination by the reporting entity | 365 days | |||||||||||||||||
NBIoT capitalized costs | ||||||||||||||||||
Related Party Transactions | ||||||||||||||||||
Cost of sales - equipment and other | $ 1,000,000 | $ 0 | $ 2,000,000 | $ 0 |
Related Party Transactions - Pa
Related Party Transactions - Part 2 (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | Feb. 28, 2017 | |
Related Party Transactions | ||||||
Allowance for Doubtful Accounts Receivable | $ 49,068 | $ 49,068 | $ 19,280 | |||
NagraStar | ||||||
Related Party Transactions | ||||||
Ownership interest (as a percent) | 50.00% | |||||
Purchases from related party | 13,259 | $ 14,355 | 27,351 | $ 28,714 | ||
Amounts payable to related party | 17,930 | 17,930 | 9,630 | |||
Commitments to related party | $ 4,159 | $ 4,159 | 4,893 | |||
Dish Mexico | ||||||
Related Party Transactions | ||||||
Ownership interest (as a percent) | 49.00% | 49.00% | ||||
Revenue from related party | $ 6,751 | 1,412 | $ 13,594 | 2,816 | ||
Amounts receivable from related party | 11,892 | 11,892 | $ 7,057 | |||
Dish Mexico | Transponder lease revenue | ||||||
Related Party Transactions | ||||||
Revenue from related party | 5,463 | 10,925 | ||||
Dish Mexico | Uplink Services | ||||||
Related Party Transactions | ||||||
Revenue from related party | $ 1,288 | $ 1,412 | $ 2,669 | $ 2,816 |
Subsequent Events (Details)
Subsequent Events (Details) - Senior Notes 7.375 Percent Due 2028 [Member] - Subsequent event $ in Billions | Jul. 01, 2020USD ($) |
Subsequent Event [Line Items] | |
Interest rate (as a percent) | 3.375% |
DISH DBS Corporation ("DDBS") | |
Subsequent Event [Line Items] | |
Interest rate (as a percent) | 7.375% |
Principal amount of debt | $ 1 |
Redemption price as a percentage of principal amount | 100.00% |
Percentage of principal amount at which notes may be required to be repurchased in event of change of control | 101.00% |
DISH DBS Corporation ("DDBS") | Maximum | |
Subsequent Event [Line Items] | |
Debt Instrument, Redemption Price, Percentage of Principal Amount Redeemed | 35.00% |