Sharing H/D initiative by D* & E* - AVS Forum
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post #1 of 60 Old 01-03-2007, 08:04 AM - Thread Starter
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Comment by John Malone on H/D initiative between D* & E* as reported by
SkyREPORT 1/3/2007(partial quote..)
-----------------------------
Malone said although many observers believe the federal government would continue to disapprove of a merger deal, the companies could still work together on various projects, specifically HDTV. If the government won't let the two companies join forces, the Liberty chair said they could save a lot of money by cooperating in certain areas.

"We could form an alliance with EchoStar and share a high-definition platform, which would either double the capacity or cut the costs in half," Malone told Broadcasting & Cable. "We could develop content jointly with EchoStar for that high-definition platform, which would be very interesting."

---------------
Gives you some insight as to what he is thinking.
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post #2 of 60 Old 01-03-2007, 12:24 PM
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D* and E* could save $$$, but what about us? Higher or lower HD programming costs? Would we still get HD-Lite?

Interesting if it could happen.

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post #3 of 60 Old 01-03-2007, 12:56 PM
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I don't see it happening. D* would like it for the next six months and then with their planned capacity, why would they take their competitive advantage away and let E* share it.

The HD battle is going to be back and forth for a while. The company that has the upper hand at the time isn't really going to want to share that upper hand with the competition.

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post #4 of 60 Old 01-03-2007, 01:36 PM
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This scares me. It could push DIRECTVs plans back a couple of years while they figure out how to combine services. I have been patiently waiting but come on already.
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post #5 of 60 Old 01-03-2007, 02:07 PM
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Quote:
Originally Posted by BJS188 View Post

This scares me. It could push DIRECTVs plans back a couple of years while they figure out how to combine services. I have been patiently waiting but come on already.

This will not delay anything.

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post #6 of 60 Old 01-03-2007, 02:10 PM
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Originally Posted by sleeks View Post

I don't see it happening. D* would like it for the next six months and then with their planned capacity, why would they take their competitive advantage away and let E* share it.

Because it is not a D* vs. E* battle going forward. It is a DBS vs. Cable vs. Telco battle. Together they can provide better HD services than they can alone and better than cable would ever hope to. Telco could provide competition, but only after billions and years are invested in fiber.

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post #7 of 60 Old 01-03-2007, 02:25 PM
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Quote:
Originally Posted by BJS188 View Post

This scares me. It could push DIRECTVs plans back a couple of years while they figure out how to combine services. I have been patiently waiting but come on already.

I can't agree more! As an early HD adopter (1998-9) I have watched and patiently endured D* measley HD line up for 9 years. I definately don't want to wait anymore! Promise after promise we have waited. Now, its 2007 and the waiting must end!

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post #8 of 60 Old 01-03-2007, 03:07 PM
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Quote:
Originally Posted by Ken H View Post

This will not delay anything.

I agree, the sats will launch this year as scheduled but beyond that I am not sure that anything specifically has been promised by D* except capacity. John Malone will see that capacity as a bargaining chip to improve shareholder value. Remember shareholder value does not necessarily equal better service for subs. As D* customers, we should ask, did TCI customers benefit from Malone's ownership of the company?

If there is an agreement with E* over HD, say capacity for product, that Malone can pull off to improve shareholder value, he will do it. If the subs also get more hd or better picture quality as a by product then that would be ok but it will not be his driving force. I think he sees the ability to improve value over the short term which means he will eventually sell D* to someone.

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post #9 of 60 Old 01-03-2007, 03:19 PM
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There are already stories speculating that Malone is interesting in acquiring Cablevision's Liberty opertaion -- which, among other things, includes VOOM.

I would be very surprised if D* and E* don't reach (and pretty quickly) some sort of sharing agreement on programming (and very probably on STBs, too). It makes no sense to duplicate so much when massive cost effectiveness could be achieved relatively quickly and inexpensively.
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post #10 of 60 Old 01-03-2007, 03:50 PM
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Originally Posted by fredfa View Post

There are already stories speculating that Malone is interesting in acquiring Cablevision's Liberty opertaion -- which, among other things, includes VOOM.

I would be very surprised if D* and E* don't reach (and pretty quickly) some sort of sharing agreement on programming (and very probably on STBs, too). It makes no sense to duplicate so much when massive cost effectiveness could be achieved relatively quickly and inexpensively.

TOTALLY DISAGREE!! Why would 2 competing entities voluntarily share their resources while competing for THE SAME EYEBALLS!!??!! Especially the more lucrative, desirable eyeballs???? The ones that pay for additional services like HD, Sunday Ticket, etc. , etc???

Can anyone provide examples of where this has ever SUCCESSFULLY happened before while the 2 companies remained independent of each other?????
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post #11 of 60 Old 01-03-2007, 04:13 PM
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Quote:
Originally Posted by perilous View Post

TOTALLY DISAGREE!! Why would 2 competing entities voluntarily share their resources while competing for THE SAME EYEBALLS!!??!! Especially the more lucrative, desirable eyeballs???? The ones that pay for additional services like HD, Sunday Ticket, etc. , etc???

Like it was said above. It is because of the wired providers (Telco and Cable).
Of course E* and D* are competing for eyeballs but they see the threat from wired competition much more damaging to their future.
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post #12 of 60 Old 01-03-2007, 05:20 PM
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Originally Posted by perilous View Post

Can anyone provide examples of where this has ever SUCCESSFULLY happened before while the 2 companies remained independent of each other?????

They can still compete. Each company would have its own subs. All they would be doing was sharing hardware.

This is what should have been done when LIL became available. There is no reason for all those locals to be up twice, or 4 times if you count HD LIL in top markets.

There are lots of joint ventures between so called competitors in today's business world.

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post #13 of 60 Old 01-03-2007, 05:44 PM
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I wonder if D* would share NFL ST HD games??

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post #14 of 60 Old 01-04-2007, 08:12 AM
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Quote:
Originally Posted by herdfan View Post

There are lots of joint ventures between so called competitors in today's business world.

Not in "core" businesses...
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post #15 of 60 Old 01-04-2007, 08:33 AM
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They will just share bandwith on 110 and 119, and they each still have to work out deals with the content provides.

Like say Setanta Sports will be availble on 110, but only D* has agreement to carry it, E* subs will have acess to that feed once if ever E* can reach a deal. This will save alot of bandwith to both providers and maybe the PQ can improve to like the old days.
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post #16 of 60 Old 01-04-2007, 10:06 AM
 
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If you think of this as a utility and examine the way that the electric companies shared the same electric lines and resell the same electricity to their customers because of deregulation in several states now, you will have a greater understanding of how this would work.

"What is Electricity Deregulation? Until a few years ago, electricity was a monopoly in Texas. Electric consumers did not have a choice in choosing their electric provider. Electricity Deregulation is giving Texas' s businesses the power to choose their Retail Electricity Provider (REP) in much the same way Texans can now choose phone service. Just like the break up of phone monopoly led to lower prices and made overall phone service better, the same thing is happening for Texas electric consumers with electricity deregulation."

"The 3 parts of your electric bill are generation, transmission and distribution. Electricity Deregulation in Texas changes how electricity generation is bought and sold. Generation accounts for the bulk of your electric bill and by deregulating electricity, inefficiency in electric generation can be reduced dramatically."

http://www.texaselectriccompany.com/...ric-choice.htm
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post #17 of 60 Old 01-04-2007, 10:13 AM
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If it works the way electricity deregulation has worked in Texas then you can expect the price to the customers to double! The cheapest electricity in Texas is now in the cities that weren't deregulated.
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post #18 of 60 Old 01-04-2007, 11:09 AM
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Quote:
Originally Posted by perilous View Post

Not in "core" businesses...


frequently the cell phone companies have a greements to work together to site towers. Having the exact same tower locations as your wireless competitor doesn't get any more core than that. They choose to compete on priceing, plans, customer service and the like. Plus you can agree to share a large portion of your network (say the Ka band as an example) but still maintain the Ku bands apart so you cn ause that to differentiate (just as cell companies likely have some cells that they dont share).
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post #19 of 60 Old 01-04-2007, 11:12 AM
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if they (d* and e*) come out with an HD-pack for $30 that includes all the non-premium hd channels that are out there right now, with full bitrate and res, I wouldn't mind paying for it.

I do agree that it is quite idiotic for all those channels to be duplicated and eat up satellite space.
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post #20 of 60 Old 01-04-2007, 11:26 AM
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Quote:
Originally Posted by roachxp View Post

They will just share bandwith on 110 and 119, and they each still have to work out deals with the content provides.

Like say Setanta Sports will be availble on 110, but only D* has agreement to carry it, E* subs will have acess to that feed once if ever E* can reach a deal. This will save alot of bandwith to both providers and maybe the PQ can improve to like the old days.


exactly- they still need agreements with the content owners.

So they could create a pool of "shared assets" - myself I think more likely to be on something new like Ka so they dont need to play with their legacy customers but who knows. THen in that pooled resource they put content they both have. Say for example Directv kicks in the 2 spaceways for HD spots and one of the new Ka national/spot beam birds this year- then DIsh tosses on the voom bird to be used for HD spots and 2 of the national KA birds that voom ordered (completely made up example). THen they put all the HD LIL's on those birds and both could sell them. On the national portions they could carry HBO/SHO/ and all the other they BOTH choose to carry. Directv could still put up differnt content (sinday ticket HD) on it's second Ka national Bird or on 110/119/101 Ku and DIsh could use some of their other assets to put up the voom channels (assuming Directv never wants them).

It makes complete sense.

They dont need to merge their complete systems, just create a susbsystem that they share.

Someone on the DBSforums the other day brought up negotiating for content and how it's illegal for Comcast and Directv and Dish to go together to a channel and demand a good rate. But they suggested if a shell company was formed to buy the channel and then resell it that it might make sense. It's a bit extreme but Dish ANd Directv could form a joint venture (like they tried to buy wimax licenses). Then assuming that thought is really legal- that partnership would be responsible for buying HD locals and RSN's for dbs distribution. THen that partnership could "buy" or "lease" some HD spotbeam capacity from DISH and DIrectv and transmit those HD LIL's and RSN's on those spotbeams. THen they would sell those channels wholesale to Directv and DIsh. depending on how they want the taxes to look they could set it up so the lease fees paid by the joint venture to get bandwidth would about equal the fees charged for wholesale distribution. In the end the Sat companies get TWICE the HD locals for the same out of pocket. And they could compete on price, service, and other differentiators like sunday ticket, foreign language or voom channels.

I've thought DIrectv would never go for it since they look to be much better off with their KA spectrum at 99, 101, 103 and sats on the way to use it. But if Malone is talking about it, then it sounds like Directv is in and Ergen just needs to rubber stamp. I'd say it's quite likely if malone is talking about it.
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post #21 of 60 Old 01-04-2007, 12:46 PM
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Sometime in 2007 D* will have something that E* does not have (besides ST) and that is extra bandwidth with the launch of two sats. Both sat casters have bandwidth problems now. That seems to be the "hammer" at the negotiating table. I would think that would give D* a distinct advantage over E* (unless they screw it up) so I think John Malone would like to hear ideas from everyone and then cherry pick the best one since he has the asset (bandwidth).

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post #22 of 60 Old 01-04-2007, 02:18 PM
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Well, if they share bandwidth which frees up more, this could help D* in their pursuit of broadband. Or more HD VOD, more ppv, etc. Of course adding those services would be used after the HD and SD PQ increased.
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post #23 of 60 Old 01-04-2007, 02:24 PM
 
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Originally Posted by AMorrison View Post

If it works the way electricity deregulation has worked in Texas then you can expect the price to the customers to double! The cheapest electricity in Texas is now in the cities that weren't deregulated.

I don't live in one of the half dozen or so states with electricity deregulation and I can assure you that my bill has doubled in the last 2 years as well.

Have you checked the price of a barrel of oil over the last few years?
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post #24 of 60 Old 01-04-2007, 06:41 PM
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Originally Posted by HDTVFanAtic View Post

I don't live in one of the half dozen or so states with electricity deregulation and I can assure you that my bill has doubled in the last 2 years as well.

Have you checked the price of a barrel of oil over the last few years?

It almost caused a complete meltdown of the California economy, of course, there was little Texas company called Enron in the mix at the time.
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post #25 of 60 Old 01-04-2007, 07:23 PM
 
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Originally Posted by keenan View Post

It almost caused a complete meltdown of the California economy, of course, there was little Texas company called Enron in the mix at the time.

While I am by no means an expert on the timelines of Enron and the states that have Energy deregulation, I do know that in Pennsylvania it was a big success with people documenting savings right off the bat.

Texas did not start energy deregulation until January 2002 and obviously Enron had filed for Chapter 11 in December of 2001

California obviously was a disaster - but then again - what isn't in California

The point is, whether you want to talk of electric companies sharing the same lines, cellular systems sharing towers (even TV stations lease out tower space to competitors), or pipelines putting in oil in one end with a balloon to signal where one company's shipment ends and the other begins, there is plenty of precedent for having a common distribution system that I don't see where it wouldn't pass government scrutiny.

That said, I'm not a practicing lawyer either

In a worse case scenario, both companies could put all their uplink and distribution satellites into a pot of a co-owned company which would further remove the companies by one step (though again, as satellite leases might have to be rewritten, that might be more trouble than its worth as there really is no reason for it - especially if the deal goes south - which is the biggest downside issue longterm).

The biggest issues shorterm is 2 different encryption systems - and quite frankly, I have no idea if NDS and Nagra could ever be made to work off the same cards in the corresponding IRDs - even with firmware upgrades.
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post #26 of 60 Old 01-04-2007, 07:24 PM
 
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I've always thought that it made sense for D* and E* to share resources when it came to broadcasting local channels. I mean, the requirement for locals is federally mandated, right? So now there is tons of money and bandwidth spent by these two competitors to in effect, exactly duplicate each others offering of this mandated requirement. I mean, what does one spotbeam or two beaming down on Chicago mean if both companies are required by law to have it? There is no real competition happening there, just compliance.

So I'm not sure what they mean overall when talking about all this 'sharing' resources...90 percent of the chatter, like the liberty/cablevision/voom/D* theories, is just speculation. But if they were to share the resources for all this HD-lil they've been touting...just plain give us together that which by law they are required to give us even when they are apart anyway, than go ahead! I'll take it! Its the same thing regardless, and if the extra resources are used to improve PQ, deliver more HD locals (the CW for instance), and bolster the ability for both E* and D* to compete more aggressively and offer more in National HD spotlight then GREAT! I WOULD LOVE TO SEE THAT!

But what I don't want to see is lack of competition, because I can see both D* and E* just saying "thank god we don't have to worry about this crap anymore", not caring about what HD they provide from that point on....
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post #27 of 60 Old 01-04-2007, 08:11 PM
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Quote:
Originally Posted by HDTVFanAtic View Post

I don't live in one of the half dozen or so states with electricity deregulation and I can assure you that my bill has doubled in the last 2 years as well.

Have you checked the price of a barrel of oil over the last few years?

The price of natural gas is far more pertinent to the price of electricity in Texas. As expected TXU and Reliant raised their rates as natural gas prices increased. Unfortunately, now that natural gas has declined back to around half of what it was a year ago their prices haven't dropped so they're making out like bandits.
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post #28 of 60 Old 01-04-2007, 11:18 PM
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Quote:
Originally Posted by HDTVFanAtic View Post

While I am by no means an expert on the timelines of Enron and the states that have Energy deregulation, I do know that in Pennsylvania it was a big success with people documenting savings right off the bat.

Texas did not start energy deregulation until January 2002 and obviously Enron had filed for Chapter 11 in December of 2001

California obviously was a disaster - but then again - what isn't in California

The point is, whether you want to talk of electric companies sharing the same lines, cellular systems sharing towers (even TV stations lease out tower space to competitors), or pipelines putting in oil in one end with a balloon to signal where one company's shipment ends and the other begins, there is plenty of precedent for having a common distribution system that I don't see where it wouldn't pass government scrutiny.

That said, I'm not a practicing lawyer either

In a worse case scenario, both companies could put all their uplink and distribution satellites into a pot of a co-owned company which would further remove the companies by one step (though again, as satellite leases might have to be rewritten, that might be more trouble than its worth as there really is no reason for it - especially if the deal goes south - which is the biggest downside issue longterm).

The biggest issues shorterm is 2 different encryption systems - and quite frankly, I have no idea if NDS and Nagra could ever be made to work off the same cards in the corresponding IRDs - even with firmware upgrades.

I agree, a co-owned delivery infrastructure makes perfect sense for both companies, set top boxes though would be another question, as you note, they won't work with each other's delivery system. 100 % STB replacement should still be far, far, less expensive than all the duplication of birds that is going on now.

I don't know what happened in Texas, in Cali, it was Enron's shenanigans that brought the state close to bankruptcy and cost Gray Davis the governor's chair. Californians also don't forget how another Texan, GWB, turned his back on us when we asked for legal federally funded relief.
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post #29 of 60 Old 01-04-2007, 11:31 PM
 
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Quote:
Originally Posted by keenan View Post

I agree, a co-owned delivery infrastructure makes perfect sense for both companies, set top boxes though would be another question, as you note, they won't work with each other's delivery system. 100 % STB replacement should still be far, far, less expensive than all the duplication of birds that is going on now.

I don't know what happened in Texas, in Cali, it was Enron's shenanigans that brought the state close to bankruptcy and cost Gray Davis the governor's chair. Californians also don't forget how another Texan, GWB, turned his back on us when we asked for legal federally funded relief.

While I am in no means defending GWB, if a state asks for federally funded relief because of earthquakes, fires or mudslides in California - I can see it - but to offer federal relief because of bad decisions made by the voters who voted for the proposition or the elected officials who wrote or enacted the law - that certainly sets up a slippery slope that I agree I don't think the Federal Government should be involved in. If it forces the voters of California to throw the people out that were responsible or let it happen instead of getting the free pass, then I could argue it worked as it should have.

If I disagree with my taxes or retirement going to the infrastructure of Iraq, who bails me out when I am living on the street? My only choice (as small as it seems) it to change the people that represent me. If I always get bailed out - will I make that decision?

I guess its sort of like the father that lets his son spend a night in jail after always bailing him out - to find out what the real consequences are.

But whatever, all this is not germaine to this discussion.

Quote:
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But what I don't want to see is lack of competition, because I can see both D* and E* just saying "thank god we don't have to worry about this crap anymore", not caring about what HD they provide from that point on....

As for E* or D* in competition, I tend to agree that the landscape has changed and that with telco's opening up, it can be argued that the delievery medium is not just DBS or a cable company now.

Just as cellphone rates and long distance have come down since 1985 with increased competition (remember there were essentially 3 long distance companies in the early 80s and only 2 cellphone companies per market in the late 80s) the more methods of delivery the greater and cuthroat the competition will become.

If you think about it, right now if you combined the resources and eliminated the overlap in spotbeams, there is easily enough capacity to put up the entire ATSC transmissions of the USA in mpeg4 as we speak.
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post #30 of 60 Old 01-05-2007, 05:57 AM
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Quote:
Originally Posted by HDTVFanAtic View Post

The biggest issues shorterm is 2 different encryption systems - and quite frankly, I have no idea if NDS and Nagra could ever be made to work off the same cards in the corresponding IRDs - even with firmware upgrades.

In the shorterm it is really not. We have all read about D* and their capacity for 150 national channels and the response that there aren't 150 national channels, so it would be easy for 10 & 11 to carry 2 sets of 75 channels for a couple of years.

The big obstacle would be E* customers having to get a new dish again.

Please do not send me PM's asking for software! You will not get it.
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