Jason Kiser - Treasurer R. Stanton Dodge - Executive Vice President, General Counsel and Secretary Joseph P. Clayton - Chief Executive Officer, President and Director Robert E. Olson - Chief Financial Officer, Principal Accounting Officer and Executive Vice President Charles W. Ergen - Co-Founder and Chairman Thomas A. Cullen - Executive Vice President of Corporate Development

Stefan Anninger - Crédit Suisse AG, Research Division Marci Ryvicker - Wells Fargo Securities, LLC, Research Division Douglas D. Mitchelson - Deutsche Bank AG, Research Division Benjamin Swinburne - Morgan Stanley, Research Division Michael Liddell - Nomura Securities Co. Ltd., Research Division Tuna N. Amobi - S&P Equity Research Craig Moffett - Sanford C. Bernstein & Co., LLC., Research Division James M. Ratcliffe - Barclays Capital, Research Division Bishop Cheen - Wells Fargo Securities, LLC, Research Division Thomas W. Eagan - Collins Stewart LLC, Research Division Todd T. Mitchell - Brean Murray, Carret & Co., LLC, Research Division

Good morning. My name's Nicole, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the DISH Network Corporation Q4 2011 Earning Conference Call. [Operator Instructions] Thank you. Mr. Kiser, you may begin your conference.

All right. Thanks, Nicole. Well, thanks for joining us, everyone. My name's Jason Kiser, and I'm the Treasurer here at DISH Network. I'm joined today by Charlie Ergen, our Chairman; Joe Clayton, our CEO; Tom Cullen, Executive Vice President; Bernie Han, COO; Robert Olson, our CFO; Paul Orban, our Controller; and Stanton Dodge, our General Counsel. Before we open it up for Q&A, we do need to do our Safe Harbor disclosure. So for that, we'll turn it over to Stanton. R. Stanton Dodge: Thank you, Jason, and good morning, everyone, and thank you for joining us. We invite you to participate in listen-only mode on the call and ask that you not identify participants or their firms in your reports. We also do not allow audio taping and ask that you respect that. All statements we make during this call that are not statements of historical fact constitute forward-looking statements, which involve known and unknown risks, uncertainties and other factors that could cause our actual results to be materially different from historical results and from any future results expressed or implied by such forward-looking statements. For a list of those factors, please refer to the front of our 10-K. All cautionary statements that we make during this call should be understood as being applicable to any forward-looking statements we make wherever they appear. You should carefully consider the risks described in our reports and should not place undue reliance on any forward-looking statements. We assume no responsibility for updating any forward-looking statements. And with that out of the way, I'll turn it back over to you, Jason.

Thanks, Stan. And I believe both Joe and Robert has some prepared remarks they'd like to go through before we open up the lines for questions. Joseph P. Clayton: Thanks, Jason, and good morning. Now when I last spoke to you all back in November, I discussed the steps that we had taken to refocus our business. I also told you all that we expected to see improved financial and sales performance in the fourth quarter. This momentum would springboard us into the New Year. Then we'd launch a host of new strategic initiatives to enhance our ongoing transformation. Well, I'm pleased to report that the fourth quarter was indeed a positive quarter for DISH, both commercially and financially. And today, I'm also going to briefly discuss our exciting new product and marketing programs that we announced last month at the Las Vegas Consumer Electronics Show. But first let me provide you all with an update on our DBSD and TerreStar spectrum assets. As you are aware, we've been working with the FCC to gain approval on our transfer and waiver rights request so that we can proceed in closing both transaction. We anticipate receiving a response from the FCC in the coming weeks. Until then, we cannot comment on our specific plans. But I will say that we're anxious to move beyond the regulatory phase. And we want to optimize these wireless assets in order to drive our compelling customer offering. This is the way the American consumer is going, wireless video, wireless voice and wireless broadband. A little later, Charlie can also speak to these assets if the question arises. Now let's spend a minute updating you all on our Blockbuster segment. For the third straight quarter, the overall business was breakeven. For the third quarter, the overall business came in very close to where we'd expected. And we have been very clear from the beginning that we would take action when necessary. As a result, the first quarter, we will close roughly 500 domestic stores for a variety of reasons, such as underperformance, footprint size or lack of landlord flexibility. The vast majority of these stores have flexible termination provisions. Now our goal is to reach a steady-state store count so that we can leverage with our current pay-TV business and our future wireless enterprise similar to the way that we've incorporated Blockbuster @Homes, by mail and streaming services into our pay-TV business. Now let's take a look at the current pay-TV market environment. When the economy changes, the consumer changes, technology changes and the competition changes, guess what, you better change. There's no question that significant shifts are taking place in the pay-TV industry today. The market is most certainly approaching a saturation point. We will still experience single-digit growth as the economy rebounds and new home formations restart. And within this mature environment, there will be some growth segments, like the Hispanic market and the consumer B2B or business market. These are 2 of the categories that will receive a much greater business focus from us as we move into 2012. We've also spent the last 6 months retooling and reenergizing our core pay-TV business. This includes launching new products; new promotions; a new brand image, focused on variety, innovation and value; new corporate partnerships; new marketing communications, including a new website and new national advertising; and even new corporate mascots. Again, it is no secret that the pay-TV industry has been too focused on price. It is being driven today by aggressive new customer discounting at the risk of alienating existing customers. And our current products have had consumer-friendly names, like our own ViP 722k. Going forward, we want our DISH products to be perceived more like the mobile phone industry, with names like the RAZR, the iPhone and the Droid. So we've introduced new corporate kangaroo mascots, Hopper and Joey, to symbolize a new era for DISH. They give a personality and an attitude to the product itself. The revolutionary new Hopper is the satellite industry's smallest, energy-efficient and feature-laden HD whole-home DVR. Hopper's sidekick is the Joey, a tiny, lightweight and easy-to-hide companion for multiple-room viewing. Our Hopper HD DVR solution lets the customer watch TV shows and movies in up to 4 different rooms at the same time, record as many as 6 HD programs at once and it is equipped with the fastest and simplest user interface in the video industry today. And to further differentiate our new product and technical platform from our competitors, we will bring more music, more movies and more magic to the American public. First, in terms of music. Hopper will offer 73 channels of SIRIUS XM commercial-free music, including 9 new Latino stations. And because we are a visual company, the album cover of the appropriate song will also appear on the screen. Secondly, more movies. The Hopper also possesses a 2-terabyte hard drive that stores up to 2,000 hours of sports and entertainment content, the industry's largest video library. And lastly, the magic. With just one click, the Hopper can automatically record every prime time show in high definition, ABC, CBS, FOX and NBC for 8 consecutive days. We call this unique feature PrimeTime Anytime, and we are confident that it will capture the minds and imagination of the buying public. Now another bit of Hopper magic is its ability to offer on-demand content for customers with limited or no Internet access. We call this capability DISH Unplugged, and it delivers hundreds of the most popular movies and TV shows via satellite. More music, more movies and more magic, all product attributes that the cable industry and DirecTV cannot match. You know DISH has always had a history of technical innovation, but we were reluctant to tell anybody about it. That will change going forward with very focused promotional and advertising activities. The centerpiece of our first quarter marketing campaign will be our Blockbuster @Home promotion. This is basically our original Blockbuster Movie Pass announced last fall, but now enhanced with an additional 6,000 streamed family and kid shows. A large number of these titles address the Hispanic market, thanks to a new programming agreement with Univision. Our Sling-enabled TV Everywhere product is another DISH first. And this has been underpublicized. We've enhanced this capability to allow subscribers to watch DISH online content via tablets and other mobile devices. And to ensure that potential customers have the ability to sample our compelling content, we will introduce DISH Test Drive, which lets consumers view video on their tablet, PC or smartphone at no charge for 24 hours. And finally, our Hopper launch will be supported by a product-focused national advertising campaign beginning March 15. So as we used to say in the TV business, stay tuned. So we basically revamped our pay-TV and commercial direction. And going forward, we want to communicate to the American public an image that represents family, fun and wholesome entertainment. Now one last product announcement at CES was our new broadband satellite partnership with ViaSat. We've just started offering broadband satellite, bundled with our own DISH video services. This will make available download speeds of up to 12 megabits to millions of customers in rural America. Now let's move onto the highlights of the fourth quarter. We gained 22,000 subscribers in the fourth quarter compared to the third quarter, both from increased activations and improved churn. We ended 2011 with a total net loss for the year of 166,000 subscribers. But more importantly, we generated positive sales momentum in the back half of the year. An additional plus: churn came in at 1.54% for the fourth quarter and 1.63% for the full year. With our price freeze on core programming packages this year, the stage is also set for a good churn number in 2012. Originally or operationally, we continue to make improvements in customer service, installation and retention, plus we're making a significant investment in our information technology. For example, we expect to launch our new billing system in late March. In terms of financial performance, a net income increase year-over-year in both the fourth quarter and for the full year 2011. Cash flow was also significantly higher year-over-year. And Robert will give you more detail in a few minutes. Now looking forward into 2012, we'll focus on providing the best product and value in the industry. We will also accelerate our operational initiatives to increase our number of Internet-connected customers and to increase overall levels of customer satisfaction. As I previously stated, we had a strong year in terms of net income. In 2012, we'll not have the benefit of a price increase to offset higher programming costs. However, with our new product and marketing plans in place, we're striving to maintain our net income level. Now to give you some additional highlights into our fourth quarter financial results, here's our CFO, Robert Olson. Robert E. Olson: Thank you. Well, as Joe described, our fourth quarter results were generally in line with expectations. While most metrics improved, we still have a lot of work ahead of us. We were pleased with our churn rate of 1.54% for the fourth quarter and 1.63% for the full year, which indicates our everyday value message is starting to resonate with our customers. Subscriber-related revenue grew by 3.4% in 2011 compared to 2010, and increased by 1.7% year-over-year in the fourth quarter. ARPU was up 3.5% year-over-year in the fourth quarter, and increased by $0.31 relative to the third quarter. As discussed in our last call, pay-per-view revenue and ad sales revenue typically improves sequentially in the fourth quarter. Total company revenue increased by 13.3% year-over-year in the fourth quarter and by 11.1% comparing the full year 2011 to 2010. The revenue increase was largely driven by the incorporation of Blockbuster into our results and our pay-TV price increase in early 2011. Subscriber-related expenses increased by 2.5% in 2011 versus 2010 and by 1% year-over-year in the fourth quarter. We continue to work on driving down our variable cost through process improvements in operations. These variable cost reductions were offset by higher programming expenses. The programming expense increase was due to contractual rate increases and was consistent with the trends we have seen during the last few years. Total cost of sales increased year-over-year as 2010 did not include Blockbuster's results. As Joe mentioned, we are closing roughly 500 Blockbuster stores in the first quarter. We analyzed profitability at the store level and these stores were not able to reach acceptable levels of performance. We expect the shutdown costs associated with these store closures to be minimal. As we have discussed before, we were able to purchase the Blockbuster assets at a far lower price than their previous book value. As a result, we saw lower-than-historical levels of Blockbuster cost of sales in 2011. This impact will diminish over time as Blockbuster's inventory is replenished with new content. So we still have a lot of work ahead of us to improve the retail stores. Our focus is to keep the business near breakeven, while we test new marketing ideas, both integrated with the pay-TV business and standalone. Our SAC for the year was $771, a slight improvement versus 2010 due to a higher percentage of redeployed receivers, which was driven by an increased mix of MPEG-4 receivers in our installed base. SAC in the fourth quarter was $778, a significant improvement year-over-year as last year's number was distorted by the impact of programming rate disputes on our new activations level. Administrative expenses were also impacted by the Blockbuster acquisition. G&A expenses for the DISH pay-TV business were largely consistent with recent trends. Net income was up almost 54% for the full year and increased 24% in the fourth quarter on a year-over-year basis. This improvement was driven by the pay-TV price increase in February, lower activation levels and lower litigation accruals, partially offset by increased interest expense this year due to higher debt levels. Our effective tax rate in the fourth quarter was about 4 points lower than run rate, driven partly by a true-up on state tax rates based on our recent filings. Going forward, we expect our effective tax rate to be in the 37% to 38% range, similar to our full year rate. We generated $398 million of free cash flow in the quarter and almost $1.8 billion for the year. Improved year-over-year net income less capital spending and favorable cash versus booked taxes due to bonus depreciation have all contributed to this performance. There were 2 major changes on the balance sheet versus last quarter. First, on October 3, we redeemed the remaining $915 million principal balance on our 6 3/8% senior notes. Second, we paid out $893 million of cash on December 1 to support our $2 per share dividend. While we have largely funded DBSD and TerreStar, the timing of the deals closing depends on FCC approval. These acquisitions will be consolidated as of their closing dates. Let me now turn it back to Joe before we start Q&A. Joseph P. Clayton: Thanks, Robert. A new year, a new DISH, new product, new promotions and new opportunities. After 8 months here at DISH, we're about where I expected us to be. In other words, we are on schedule in terms of our transformation plan. Plus we've just passed the 14 million subscriber mark. We have a solid plan in place and we are working hard every day to accomplish it. Phase 1 of our transformation plan is now complete. We have identified the areas for improvement. We have set specific objectives. And these include: increase net activations, lower churn, improve customer satisfaction, decrease customer contact rate, increase broadband connectivity, grow market share and improve ARPU. And lastly, we developed a detailed game plan or strategy. In fact, we've already prioritized and launched key improvement initiatives. And now Phase 2 begins. That is all about execution. As we move forward, we will fix the things that need further improvement, implement additional plans, and where required, modify the game plan accordingly. With hard work and improved economy and successful implementation of our plan, we should be hitting on all cylinders by year end. Thanks for listening and putting up with my cold today. Now we'll open it up for your questions.

[Operator Instructions] Your first question comes from the line of Stefan Anninger from Credit Suisse. Stefan Anninger - Crédit Suisse AG, Research Division: Could you discuss your outlook for 2012 ARPU growth and what are the things you are doing to help boost that growth, given the lack of a price increase in 2012? And perhaps specifically, you could talk about the roll-off of the Starz promotion and how you've gone about trying to move those subs perhaps into a premium package and how that may be going. Robert E. Olson: Yes, Stefan, this is Robert. We talked a little bit about this on our last call that we are very focused on sell-up opportunities. Premiums are an important focus for us. We've been working very hard on that. And I think that as the year progresses, we should see some slight improvement in ARPU as a result of that. We had some -- as I mentioned in my speaking notes, we had some favorable benefit in the fourth quarter as a result of normal seasonality. So I would not look for that improvement to be really material until the second quarter. Stefan Anninger - Crédit Suisse AG, Research Division: Could I ask one just quick follow-up question? Could you comment just briefly on the VOOM litigation and the recent developments there and how you think about the financial risk associated with that litigation? R. Stanton Dodge: Yes. And this is Stanton. We are obviously disappointed with the ruling from the appeals court. And as we disclosed in our K, we tend to -- or intend to and have filed briefing to actually appeal that to the next highest-level court. And we hope that they'll take that up on an interim basis. And if not, we'll certainly pursue that after the trial.

Your next question comes from the line of Marci Ryvicker from Wells Fargo. Marci Ryvicker - Wells Fargo Securities, LLC, Research Division: Two questions. Joe and Robert, you pointed out churn in the quarter, which was significantly better than expected. Can you give some color on what drove this? Is it Blockbuster? Is it better customer service? Is it anything specific? And then the second question, it looks like you're closing the gap in churn with DirecTV based on the fourth quarter. So turning to ARPU, do you think that over time the new products you're offering, the Hopper, et cetera, will allow you to close the gap in ARPU with DirecTV? And if so, how long do you think it will take for this to happen? Joseph P. Clayton: Well, I think we're doing a much better job on retention. And it started about the time the SUNDAY TICKET got rolled off back in the fall. And we fight – we work hard every day to work on our retention levels. And I'm very pleased with the direction of that it's been heading in. And we feel good about moving into 2012, where we won't take a price increase so that should give us a little bump. In terms of ARPU, I think we will narrow the gap as we sell a better mix of product hardware and a better mix of programming. How fast that gap will narrow and to what degree still remains to be seen.

Your next question comes from the line of Doug Mitchelson from Deutsche Bank. Douglas D. Mitchelson - Deutsche Bank AG, Research Division: A couple things. First, I just want to make sure I have this right. You said the goal was to strive to maintain net income levels in 2012 from 2011. Is that right? Joseph P. Clayton: Yes. Douglas D. Mitchelson - Deutsche Bank AG, Research Division: Okay. So there's $1.5 billion of net income in 2011, so the goal is to hit that. Robert E. Olson: Doug, this is Robert. Let me clarify that. Obviously, we're not going to overcome the favorable litigation accrual reversal that occurred in 2011. And then second... Joseph P. Clayton: How much was that? Robert E. Olson: That was roughly $300 million at the operating line, $200 million at the net. And then second, we're very focused on, as Joe mentioned in his speaking notes, about the pay-TV business maintaining roughly flat net income. We've made investments in the spectrum business. As we consolidate that business, we'll incur some depreciation and administrative expenses associated with that business. Once that business is -- once the approval for that business is obtained, we'll break that business line out separately. Douglas D. Mitchelson - Deutsche Bank AG, Research Division: All right. Great, that's helpful. I'm just not used to getting guidance from DISH, so it takes a little getting used to. On the DVR pricing, so I'm just curious, with the commitment to customers to not raise your programming prices, that still should leave you some flexibility to raise equipment prices, I would think. And your DVR pricing is low relative to a lot of your competitors. Is there any thoughts around the potential for raising equipment prices this year? Is that what helps you get to flattish net income for the base business? Robert E. Olson: Doug, this is Robert again. Obviously, we're looking at all aspects of our business. We have no plans right now for an equipment price increase. However, we'll look at that throughout the year. We are fairly confident in our ability, as Joe mentioned, to sell up to higher packages and to more premiums. Douglas D. Mitchelson - Deutsche Bank AG, Research Division: Great. And then I guess, lastly, I'm not sure what you're willing to say on wireless spectrum. But there is some concern that it could take a while to get approvals. Just sort of given the nature of these particular waivers, sort of the unusual circumstances around the potential for windfall profits, is there any sort of thoughts around timing as a strategy around the wireless spectrum change at all since you first started pursuing and acquiring it? Charles W. Ergen: Yes, this is Charlie. I mean, I guess, I'll start you with kind of a big -- I'll probably start you better with a big picture look at that. One is we obviously, the last 4 years, have been putting things in place to get in the wireless industry. And we think that's a key and even a transformative strategy for us. But we could only enter that business. I look at it and say, "Do I have an 80% chance of success to be successful?" And if so, you go in full-bore and give your best effort. So when we started DISH Network, we thought if we could just get past the Chinese -- the launch, get the satellite up, that we had an 80% chance of being successful. A lot of people didn't think it was that high, but that's kind of where we were. And so you always have that point. The hardest point of a new initiative is usually getting started, right? So for us in the satellite business, it really was that Chinese launch that had to be successful. We had 20 minutes of that launch. We had no control over it, the rocket's either going to be successful or not. And if it's not successful, we probably wouldn't have been able to enter the business because the time to get another satellite built and another launch would have been too great. We're in a very similar situation to enter the wireless business, where I think we have an 80% chance or better of being very successful in that business today with the spectrum that we've accumulated and with the leapfrog in technology to LTE, which is a major leapfrog from where it is today, very similar to where MPEG-2 was a major leapfrog in analog video and DBS. But we essentially have exactly the same problem as a Chinese launch in that we're in front of the FCC for a much-needed waiver, which has been granted before to other companies, so it's not a new precedent. In fact, waivers have been granted in many, many different things because it just has -- it has to be in the public interest. So that waiver is a little bit like the Chinese rocket in the sense that the FCC really has their hand on the button, and they're either -- that waiver is either going to be granted or they'll push the destruct button for our business plan would be just like a Chinese launch failure. In other words, they could go to -- they could not rule on our waiver at all, which would be the effect of killing it or they could go to a rulemaking, which would be the effect of a long delay before we could do anything. And the reason that a delay is so important is that our chipsets and our infrastructure is at a different frequency that's not used in the United States today. And so our lead time to build those products and invest in those products, we had to start from scratch. So that's a major hurdle to overcome. And you really can't start that process until you kind of have -- you kind of know the rules of the game for you entering the market. And so we need a waiver not to have to put a satellite link in our handsets. Otherwise, we wouldn't be competitive. So we're waiting to see if our launch is successful. We think that where it stands with the FCC today is that their self-imposed 180-day window from the time we filed our combined application is up on March 12. We would expect that what we've asked for is a decision on our waiver request and our merger request; we would hope that they will keep those 2 together and make a decision on those 2 things. The standard for our waiver again would be do we serve the public interest. And as opposed to maybe some people in the past, we have -- it's a fairly supportive rulemaking. We've gone through the full rulemaking process that maybe others haven't in the past. The comments, there's no material opposition even from our competitors to our getting granted the waiver. The GPS industry has come out in favor that we do -- not in favor, but the GPS industry has supported our initiative that we do not interfere in the GPS range with our frequencies, in fact, very few interference issues. And we have a situation where there's 40 megahertz of spectrum that could be put into place. And every day that we go by is a delay in whoever uses that spectrum, it's a delay in that use of that spectrum, where we have obviously a spectrum crunch. And so we're just waiting to see whether we can get I the business. If, by chance, we were not granted a waiver or it was kicked down the road without a decision through rulemaking, then I think that we'll have to consider the risk. And at this point, I would say that we probably don't have a chance of success, an 80% chance of success in the business. And we'd have to look at other alternatives on what to do with the business in the spectrum, which would be unfortunate. And additionally, we probably -- we may have to write down some of the DBSD, TerreStar assets because obviously, to the extent we couldn't use them, they probably wouldn't be worth the $3 billion or so that we paid for them. So those are all -- that's kind of where it stands. It's not many companies. Washington picks winners and losers all the time. We're not the first company that's kind of faced this proposition. But the reason we made the investment and have taken the risk is really because of what the President of the United States has said and what the FCC has said, where the President said, "We have a spectrum crunch," given many speeches on it, as has the FCC. He's concerned that companies are hoarding cash and not making investment. And we've gone out and spent actually about $4 billion for spectrum and $3 billion on spectrum and S-band even before we can get approvals. So we're a company that has not hoarded cash and has gone and invested that to grow the business. And of course, the administration has talked about needed competition in the wireless business and innovation in the wireless business. And I think we have a history of being disruptive in the video business. I think we'd be very disruptive in the wireless business. And so that gives us some degree of confidence that we would meet the standard to be in the public interest to grant the waiver. And if so, then we're prepared to enter the business and go full force to make a business out of it. And I think it would transform not only our company but I think it would transform the way that people use wireless today in the United States. It's frustrating for me to be in New York City and my phone not work, right? There's really no reason that the phone can't work. It's just an investment to make it work. And there's many features that I see in handsets around the world where the wireless innovation is greater than the United States. And I think much of that could be brought back here. So we're very excited about the business. We've got everything in place and to enter the business. And we'll wait for the next couple of weeks and see whether we're going to be in or out.

Your next question comes from the line of Ben Swinburne from Morgan Stanley. Benjamin Swinburne - Morgan Stanley, Research Division: I wanted to ask about the outlook for '12 since you guys gave some comments early on. Joe, are you thinking about trying to grow gross adds in 2012? Or do you see churn as the big opportunity as we saw in the fourth quarter to help drive not only market share growth, which was one of the bullets you laid out, but also drive that net income number you guys are sort of targeting as well? And as part of that, do you see yourself looking to unwind some of the discounting? You made some really interesting comments about the alienation of the existing customer base by giving big discounts to new customers. And I think the satellite industry has been offering somewhere around $30 a month off for 12 months for probably over a year now. Is that something you think you guys can unwind or will unwind or try to unwind this year to help on the ARPU side? Joseph P. Clayton: One, we're looking at growing gross adds. And two, we're looking at improving churn, which should give us a double bubble. And three, yes, we are looking at trying to simplify our pricing scheme, if you will, to avoid the $31 discounting that you see in the second year of some of our competitors' promotions. Benjamin Swinburne - Morgan Stanley, Research Division: Great. If I could just -- one follow-up on the broadband side. I don't know if you guys will be willing to size up how many customers you have connected to the Internet today and so what your goal is on the set-top box front. And on the ViaSat satellite broadband deal, is that a product you see as competitive to sort of wireline broadband? You mentioned it will help you in the rural markets, but 12 megabits is a decent speed. I don't know if you thought that was something you can use to go to market in wireline territories. I know you have an agreement with Charter to, at least in some markets, bundle cable broadband with DISH Network TVs. Just curious if you could spend a minute on that as well. Joseph P. Clayton: One, I do believe it's a great alternative to the 8 million to 10 million rural households that's only alternative is slow-speed DSL. I think it's going to play very fine there. In terms of going forward, I think it'll actually improve its capabilities in terms of capacity and possibly even speed. But it's not going to be as good as Fiber-to-the-Curb.

Your next question comes from the line of Mike McCormack from Nomura Securities. Michael Liddell - Nomura Securities Co. Ltd., Research Division: This is Mike Liddell in for Mike. So 2 questions. Can you provide any color on the trends in the equipment subsidies both in 4Q and how that will adjust with the new Hopper and Joey boxes? And then secondly, can you provide any color on the impact of the Charter co-marketing deal and how that influenced gross adds in the quarter? Robert E. Olson: Yes, Mike. I think that with the Hopper, obviously it really depends on what the take rate for the new receiver will be. However, the Hopper has comparable capital expense relative to our current DVRs. And it will generate comparable results. Thomas A. Cullen: This is Tom Cullen. As far as the Charter relationship, obviously, neither company is disclosing specific subscriber numbers. But we're encouraged -- continue to be encouraged with the progress. We do think that we're kind of operating in an era here of surprising alliances as we've seen over the last couple months. And many people thought this was surprising when we did it last year. But they, I think, are genuine in their focus that they're increasingly a broadband company more than a video company. We obviously run some risk at the termination or the expiration of the initial contract. But our job is to make sure the customer understands what a damn good video experience we deliver. And then when they're forced with that next opportunity to leave, they'll be convinced to stay with us and with Charter's broadband. Charles W. Ergen: And this is Charlie. Just a couple of points that Joe has made. In the Hopper, there's the 2 possibilities there that when you go to a multiroom HDTV home, our SAC, as I see, is less to do that to a Hopper because it can do every TV set in the home and in HD, whereas the products we have today don't do that. They're kind of one HD, one SD. So in a multiroom house, our SAC would actually go down from where it is today. And there is -- and of course, the multiroom DVR, there's a one-time DVR fee, but it's $10 instead of the normal $7. So there's probably a little bit of -- to the extent that the Hopper is successful, there's a little bit of an ARPU potential there as well. So we actually have some opportunity on the SAC side to improve it as we get into more -- multiroom house -- multi-HDTV households and also on the ARPU side. But of course, it depends on the success of the Hopper. Michael Liddell - Nomura Securities Co. Ltd., Research Division: And just one quick follow-up. When does the deal with Charter expire? Is that a trial 1-year deal or is that a multiyear? Charles W. Ergen: It was set as a 1-year deal with ongoing renewals, and that's where we're at now.

Your next question comes from the line of Tuna Amobi from Standard & Poor's. Tuna N. Amobi - S&P Equity Research: I have a few questions as well. I guess, the first, I'm trying to clarify the Internet-connected subs. So I know there was earlier a question on that. I wasn't sure if you provided any targets in terms of the connection of Internet subscribers this year. And potentially how do you reconcile that with the DISH Unplugged product that you mentioned, which presumably some of that has been targeted to non-Internet subs? So any color on how you balance that would be helpful, especially in a given market. Joseph P. Clayton: Well, we do have specific targets, but we're not going to get -- let's just start with that because we don't give guidance. Of course, DISH Unplugged, there will not be targets on that either because that's more of a market-driven situation. So this question is not helping you. My answer is not helping you at all even if you could hear me. Tuna N. Amobi - S&P Equity Research: Okay, that's fine. Let me move on to another question then with regard to Blockbuster. So you've been around, operating around breakeven now for the past 9 months. Now I'm kind of trying to get a sense of how much tolerance do you have for that business in terms of potential losses that you can tolerate, granted that you talk about how you're using it to leverage several other areas of your pay-TV business. So I guess my question is do you perhaps look at that business in isolation from a profit center perspective? Or are you willing to kind of continue to maybe stomach accelerating losses as long as you view the benefits of the pay-TV side as justifying those losses? So any color on that would be helpful. Thomas A. Cullen: Tuna, it's Tom. Yes, we do look at it as a separate business. And even though there is benefit accruing to the DISH side through the joint efforts, we look at Blockbuster separately and we have low tolerance for losses going forward. So that's why we're watching it very closely, made the changes that we have made. Along with the store closures, of course, comes reduction in overhead that would be more appropriately sized with a smaller store base. Mike Kelly and his team are working this day and night, and I think coming up with some creative ideas on how we can improve the remaining store traffic and revenue. But it's a work in progress, and we will keep a very close eye on it. So our tolerance to your core question is very low. Tuna N. Amobi - S&P Equity Research: Okay. And with regard to the spectrum relocation deal with Sprint, it's my understanding you paid about $114 million in Q4. So I'm just trying to clarify if that payment was expensed or if there's a potential clawback of some of that amount if the waiver is not granted or the regulatory process doesn't go through, would be helpful. Robert E. Olson: Yes, so Tuna, this is Robert. That payment was classified under other noncurrent assets. We view that as integral to the spectrum purchase. And so we evaluate that along with the amounts we spent on TerreStar and DBSD. Thomas A. Cullen: So what does that mean? Is it admin expense? Robert E. Olson: Admin expense. Thomas A. Cullen: But to your second question, there is no clawback. We view it as another demonstration of what steps we've taken that do serve the public interest to bring more spectrum to the market center. So by clearing up that multiple-year issue that was hanging over the S-band, we think that deserves consideration as well. Charles W. Ergen: I mean, this is Charlie. I mean, my experience is we're -- I do think that government and businesses have to work together. And I think a lot of CEOs kind of take a different approach. But I've always spent a lot of time trying to work with the government rather than against it. And I think that we've taken some calculated risk, and Sprint payment being one of them, which obviously would be a waste of money if we can't get into the business. But it also was an obstacle for -- it was a legitimate claim by Sprint, a, and something that other people have committed to and an obstacle for us to get approval. So it made sense for us to take care of that both from a regulatory point of view and also to clear the deck to make it in the public interest. Because that's a standard that in the current environment with some of the criticism that the commission has gotten from the LightSquared side, from Congress, which -- it would obviously make somebody more cautious going forward, no matter what -- no matter how unordered that criticism might be, when you try to do the right thing, sometimes you get criticism. So you just tend to be more cautious than -- and that's a human nature kind of thing, and I think we just put everything in place that we can to make sure that, that doesn't happen. Tuna N. Amobi - S&P Equity Research: Okay, that's helpful. And lastly, for Charlie. So you talk about 80% chance of success as your hurdle rate. As you think about the past couple of months, what has happened in wireless environment, whether it's LightSquared or AT&T, T-Mobile, a rejection and what not, how do you see your chances of success been affected by the events of recent months? And how does that perhaps affect your plans in terms of possible partnerships or other route you might go on the wireless? Charles W. Ergen: Well, I think that's a good question. I think that's one of the reasons timing is so important. I think that the landscape down at the deck has been reshuffled obviously with the rejection of AT&T and T-Mobile merger and obviously with LightSquared not at this point having to overcome their interference issues. So obviously, United States is in even a worse position right now from a spectrum crunch perspective because it's pretty clear that the LightSquared's 40, 50 megahertz isn't going to come into use any time soon. So we think that, that is a positive for where we're trying to go and a large positive. One is we are a company that can relatively immediately work on a spectrum crunch that's been exasperated. And two, because I think it does open up opportunity for partnerships in a variety of way, and obviously, we're prepared to go it alone in the business, just like we did in DBS because we begged people to build satellites for us, and nobody would, so we had to do it ourselves. Obviously, there's partnership -- relationships that could make a lot of sense for us, could be as simple as something like network sharing, where Sprint has now lost LightSquared as a tenant, at least for the near term. We just saw this morning where T-Mobile is going to build out some more of their network, that could make some sense; there's obviously some other players, that there could be partnerships. And it could be in any variety of -- those could take any variety of shape, and that would potentially be a way to enter the marketplace sooner and reduce risk. And obviously, as rational businesspeople, we look at all those things. But you have to be in the game to be able to do that. And as I said, we're not in the game right now.

The next question comes from the line of Craig Moffett from Bernstein. Craig Moffett - Sanford C. Bernstein & Co., LLC., Research Division: Charlie, you've talked in the past about the return on new customer acquisition and how you think about the promotional subsidies or the promotional costs of free programming flowing into that. Can you update us kind of how your thinking has evolved, whether the level of gross adds you're getting today is a function of selection for customers that you think you can earn a good return on? Or is it, as you project forward bigger gross adds, is it because you think you're going to do better in the segments you're already targeting? Charles W. Ergen: Well, I look at whatever -- I look at what it takes to get a customer and what the -- and I add the opportunity cost in my SAC. So I don't look at it us really having a $771 SAC, I look at us having a SAC that's greater than that because of the free programming we give away that we otherwise don't get a margin on, right? And I look at that total cost and then look at how long the consumer -- look at return on investment on the customer. So that's kind of the first step. The second step I look at, that I've been looking at, is what's our ability long term as a customer -- as a company to fight an inevitable competition that's going to come from over-the-top and broadband integration into video. And can we hold -- that even if we weren't giving discounts, can we hold onto that customer as we kind of project in the future where that's going? So I always think it's kind of crazy -- I think it's crazy to give discounts for 2 years in a 2-year contract because the customer obviously has -- 1 or 2 things is going to happen after those 2 years. The customer is going to go to another provider to get another discount or you're going to have to give that customer a bigger discount to stay with -- continue to give them a discount to stay with you. So you never, ever get a return on that customer. So we've tried to be very disciplined in our approach. We've obviously had -- we've been the least aggressive of anybody in the business in terms of how we discount. And the second thing is we've gone out and tried to prepare for the future, which is to put ourselves on a wireless business, where you're seeing the cable industry sell their wireless assets. And we've positioned ourselves to be in the wireless business, where we think that we could combine and bundle many different services to our current customers, and therefore, increase our likelihood that even though we know there's competitive disruptions coming, that we have a greater likelihood of keeping those customers. And so we're much more confident today that when Joe goes out and gets a customer, that we can hold on to that customer long term because of where we are strategically. Craig Moffett - Sanford C. Bernstein & Co., LLC., Research Division: Could I ask a follow-up to that then, which is to the extent that you didn't get the waivers, as you talked about, in front of the FCC, would that mean that without a broadband product, you would be less inclined to aggressively go after gross additions in your core business? It sounds like what you're saying is they go hand-in-hand. Charles W. Ergen: I think there's a high correlation between what we're going to do in wireless and our current business. And to the extent that we're not able to enter the wireless business, then I think you've got to look at all alternatives in terms of where you would go long term. And that might be that -- I think that there's -- I think that the business we're in today in wireless is really kind of a packaged deal, to be honest with you. I think that you have to put those 2 together as long term because no customer wants just fixed video. He's going to buy mobile video and he's going to buy mobile data and he's going to buy mobile voice and he's going to buy fixed data. So he's going to buy a bundle of services. And right now, the cable industry is the best-positioned to take advantage of that, and probably AT&T and Verizon. AT&T and Verizon have 60% of the market. And I hope this is an administration that wants some competition to that. But the way not to get competition to that is not to make decisions, right, and to be cautious. And then you're going to end up with AT&T and Verizon probably having 70% or 80% of the market, right? And so, and you've seen Verizon do a very smart thing in buying the cable spectrum. So we'd like to play, but you've got to get asked to the dance.

Your next question comes from the line of James Ratcliffe from Barclays Capital. James M. Ratcliffe - Barclays Capital, Research Division: Two if I could. First of all, have you gotten any pushback from the networks regarding the PrimeTime Anytime offering and essentially making that content available on-demand? And secondly, if you could just -- any more color regarding the impact you saw from existing customers regarding Blockbuster Movie Pass thus far and its rollout. What sort of take-up you're seeing or if you're seeing any impact on churn? Joseph P. Clayton: Okay. I'll take the first one first -- or the last one first. We did have a positive impact on Blockbuster Movie Pass. I think for the small increases that we received, I think I would attribute that to the Blockbuster Movie Pass and to some seasonality. And the first portion was? James M. Ratcliffe - Barclays Capital, Research Division: The first one, on PrimeTime Anytime and what sort of response you've gotten thus far from the broadcasters themselves on it. Joseph P. Clayton: There was some interest given by how it works by 1 broadcaster. Outside of that, it's been very quiet.

Your next question comes from the line of Bishop Cheen from Wells Fargo. Bishop Cheen - Wells Fargo Securities, LLC, Research Division: Going back to your big picture talk about spectrum and the management of it via the administration and Congress, how confident are you that both the White House and Congress will move forward in a timely fashion to try and get spectrum out to the marketplace and to manage it without undue bottlenecks? Charles W. Ergen: Well, I guess I'd say 2 things. I think that beyond our application at the FCC, right, that's just a couple of weeks away from being decided on, there really is no clear-cut way to allocate more spectrum in a timely manner really for 2 reasons. One, there's not a lot of spectrum out there. And two, the Congress and the White House really can't do it unilaterally because, for example, one of the biggest places that you might find spectrum might be in the broadcasters' side, where the broadcasters would voluntarily, based on the recent budget legislation was passed, would have to voluntarily give that up. There's some spectrum that the Department of Defense has. They'd have to voluntarily to give it up. That's not normally something that they do readily, given the effect on perhaps our defense of the country. And there's some other spectrum that's within the FCC that will have to be looked at. And that typically would go through a rulemaking process that'll take a long time. So I'm not confident there's any -- I don't see anything on the horizon that brings much spectrum into the marketplace anytime soon. And probably the best hope is the D-block. I think there's some spectrum in the D-block for public safety that's got some possibility of moving forward in the next couple years. So really, that's one of the things that give us some hope that we would approved because obviously we could come into the marketplace and start working on it within a couple weeks. And it would seem a little bit unusual. To me, it would seem a bit unusual to go through -- I think we first filed our application in May of last year, so you go 9 or 10 months, and then you decide at the end of that process to do a rulemaking when you probably could have decided to do the rulemaking 9 or 10 months ago, if that was the route you wanted to go. So I think we're kind of the country's best hope. And I think that, that's a good position to be in. But I will say that Washington -- many companies and CEOs and chairmans have been blindsided. Washington works in funny ways, and it's a complicated process. And there's issues that we wouldn't know about that they might have at the administration level or the FCC that we just wouldn't have visibility to, that'd just be issues that we wouldn't know about behind the scenes that would cause people to make decisions that otherwise might not seem logical.

Your next question comes from the line of Tom Eagan from Collins Stewart. Thomas W. Eagan - Collins Stewart LLC, Research Division: I guess, first, a follow-up question. Charlie, you mentioned that there's a possibility of the FCC initiating some kind of NPRM rulemaking on the waiver. So if there is an NPRM on the waiver, would you sell the spectrum? And then I have a follow-up. Charles W. Ergen: I think if they went to rulemaking, that we'd look at the risk profile, which if we look at it today, would say that our risk profile would increase substantially. And I think it would – it may be too risky for us to enter the business place. In which case, all options would be on the table for how we would move forward with the company and the spectrum. Thomas W. Eagan - Collins Stewart LLC, Research Division: You had said before that you had thought... Charles W. Ergen: Today, the only option on the table for us is we want to get in the business. And we spent a lot of time and hard work to get there, and we're ready. Thomas W. Eagan - Collins Stewart LLC, Research Division: You had said before that the chances of probability were about 80% previously. What do you think the probability is of the waiver being approved? Charles W. Ergen: I'd go broke betting on Washington. I'm about over 100 in Washington, so I'm hoping that -- you know that Dumb & Dumber line? I think there's a chance. We just haven't -- we haven't been very successful normally, which is why we're paying higher retrans fees. We're not very successful. Thomas W. Eagan - Collins Stewart LLC, Research Division: And then I have a follow-up. Robert, you mentioned that -- the net income being roughly flat. And I'm not sure if I quite got what you were saying. But assuming that the revenue growth is going to be somewhat limited and assuming that there's going to be increased marketing expenses, should we think that the EBITDA margin decline is going to be offset by a positive that would be below the line? Robert E. Olson: Tom, no. I think, once again, to clarify, you have to pull out the litigation accrual that occurred in 2011, accrual reversal. And then as I clarified before, it's on the pay-TV business. So to the fact -- to the extent that the spectrum business, once we start consolidating that, it'll bring depreciation and some administrative expenses, I need a pullback on that. Then just focusing on the pay-TV business, the challenge for us is to continue to do a good job of controlling expenses. Obviously, programming expenses are going to go up. And then the success factor for us in 2012 is our ability to sell up on revenue. It won't get us a lot of ARPU, but it'll get us some. And that's the thing we need to deliver in order to hit our targets.

Your next question comes from the line of Todd Mitchell from Brean Murray. Todd T. Mitchell - Brean Murray, Carret & Co., LLC, Research Division: Can you talk a little about the Blockbuster over-the-top tie-in to the DISH Network and whether it was more impactful as a churn mitigation for existing customers or if it helps you drive gross adds? Joseph P. Clayton: So obviously, we think it's helped us grow gross adds by evidence of the performance in the second quarter -- third quarter -- fourth quarter. The Blockbuster brand is a significant brand in the marketplace, which focuses on family and movies. And that's clearly what DISH is all about. And it's also the reason that we're changing it just slightly to DISH @Home with our first quarter promotion, which adds 6,000 streaming titles. We see this as both an acquisition and as a retention tool because a large portion of that new product is also Hispanic. 70% of our new customers are Hispanic. And it is a growth category for us. Todd T. Mitchell - Brean Murray, Carret & Co., LLC, Research Division: Okay. And can you talk about just in terms of your acquisition of streaming rights for that offering, how far along are you in doing that? And is there some way that you feel that you're approaching it different than some of your competitors? For instance, do you feel that with the -- basically, the Hopper recording all of the networks, that it can be Sling-ed on without streaming rights? Thomas A. Cullen: This is Tom. As you saw, we added some additional content to the Blockbuster @Home product in January. We continue to look at additional content offerings both for DISH and non-DISH. And I would say between DISH and EchoStar, we'll continue to work on streaming options, but we don't have anything further to disclose today. Todd T. Mitchell - Brean Murray, Carret & Co., LLC, Research Division: Okay. And lastly, I noticed that TiVo is no longer supporting the Blockbuster Online store. What, if anything, should we read in, into that? Is that part of a relaunch strategy? And also, what would your -- what is your strategy with regards to UltraViolet? Thomas A. Cullen: I'm sorry, on the first part, what was the question on TiVo? Todd T. Mitchell - Brean Murray, Carret & Co., LLC, Research Division: Well, I just noticed that TiVo is no longer supporting the Blockbuster store, the online store. Thomas A. Cullen: Yes. So it's underlying platform changes that we're pursuing, as I said earlier, between DISH and EchoStar. And so that, by de facto, you lose some of the distribution as you make those changes. And I'm sorry, and the second part? UltraViolet. Okay. So UltraViolet obviously is a promising development and concept. I'd say it's still in the early innings in developing. But that's an opportunity for us to forge tighter relationships with the studios that would benefit the stores as an example. Because the studios do -- most of the studios, I should say, they're not all in lockstep, do see opportunity with UltraViolet and having a physical location and being able to do some -- to provide access to the existing store traffic that we have has changed the conversation a little bit with the studios.

And there's no further calls. Back to the presenters. Thomas A. Cullen: All right. Well, see you next time; May, I guess. Thanks.

This concludes today's conference call. You may now disconnect.