EchoStar Invests In iSKY To Offer First Bundled Two-Way Broadband Internet, TV Service Via Satellite

Partnership To Provide US Consumers High-Speed Internet, Hundreds Of Satellite Television Channels With Single Small Dish And Set-Top Box

28-Mar-00

EchoStar Communications Corporation (NASDAQ: DISH, DISHP) announced a $50 million investment in iSKY Inc. The companies also announced plans to jointly offer consumers two-way wireless broadband iSKY Internet access via satellite, along with hundreds of EchoStarís DISH Networkô satellite television channels, using a single small dish at any home or office in the United States.Under the agreement, following the launch of iSKYís service, currently anticipated during late 2001, EchoStar would also distribute the iSKY satellite Internet service along with DISH Network satellite TV service through its more than 23,000 retailers nationwide. This agreement expands EchoStarís commitment to offer two-way broadband Internet services using both Ku- and Ka-band satellite technology.With this investment, EchoStar will own 12 percent of iSKY and receive warrants which, based on reaching iSKY customer targets, could increase its stake up to 20.8 percent on an outstanding basis. iSKY expects to deliver its always-on broadband solution to the home and small office/home office markets at speeds of 1.5 megabits per second (Mbps) or more - 30 times faster than current dial-up speeds of 56k. iSKY expects to be the first two-way, Ka-band, satellite broadband Internet access service when it launches in 2001.Under the non-exclusive agreement, EchoStar will provide sales and installation for consumers through its nationwide DISH Network Service Corporation, which will install a single iSKY/DISH Network dish that can simultaneously ""see"" EchoStarís and iSKYís satellites. The 26-inch dish will be capable of both receiving and sending Internet data, while at the same time receiving hundreds of DISH Network satellite television channels, including the same popular sports and entertainment services enjoyed today by DISH Networkís customers nationwide, including local channels, interactive television services, international programming and more. EchoStar and iSKY expect to be the first to offer residential consumers and small businesses a completely bundled hardware and services solution for Ka-band broadband Internet access combined with satellite TV programming. EchoStar will streamline the consumer experience by providing complete installation of the single set-top box and single dish at the consumerís home. Under the agreement, EchoStar will also receive a substantial revenue-sharing payment. iSKY and EchoStar have mutual, long-term bundling rights to sell each otherís service. ""We are excited about taking advantage of new Ka-band satellite technology to offer consumers a 21st century entertainment and communications service,"" said Charlie Ergen, CEO and Chairman of EchoStar. iSKYís initial Ka-band satellite, which is expected to be launched in third-quarter 2001 to its 109.2 degrees West Longitude orbital location, is currently under construction by Space Systems/Loral and would allow iSKY to serve North America. iSKY is expected to provide service in Latin America with the launch of its second satellite in mid-2002. ""Our partnership with EchoStar is key to our strategy of aggressively targeting the consumer market,"" said Thomas Moore, President and CEO of iSKY. ""This will be the first easy and affordable way for consumers to access Ka-band satellite broadband and satellite TV through one sales process, one installation and one set of equipment. We forecast that 25 to 30 million U.S. homes will not have access to any other broadband solution when our service hits the market next year. Of those, we expect a significant number will choose iSKY.""Other major iSKY investors include TV Guide, Kleiner Perkins Caufield & Byers, TRW, TeleSat and Liberty Media Group. Under the agreement, EchoStar will also obtain a seat on iSKYís board of directors.About iSKYiSKY (formerly KaSTAR Satellite Communications) expects to roll out affordable broadband services via satellite direct to homes and small offices in North America in 2001.In 2002, the company expects to offer service to Latin America. This innovative company was founded to accelerate customer broadband access to the Internet. The company has a seasoned management team with backgrounds in Internet, networking, satellite and cable TV. iSKYís solution delivers on customer desires for a fast, affordable, simple, reliable, always-on and two-way technology for wireless Internet access. For more information, please visit the companyís Web site at www.iSKY.net. EchoStar Communications Corp., includes three interrelated business units:DISH Network is EchoStarís state-of-the-art direct broadcast satellite system that is capable of offering over 500 channels of digital video and CD-quality audio programming, including DolbyÆ Digital surround sound, high-speed interactive television and data services, all on a single dish, as well as offering fully MPEG-2/DVB compliant hardware and installation. DISH Network was ranked number one in customer satisfaction among satellite/cable TV subscribers by the J.D. Power and Associates 1999 Cable/Satellite TV Customer Satisfaction Study. EchoStar will launch the EchoStar VI satellite in the spring of 2000 that will offer DISH Network customers expanded programming services, local channels, Dolby Digital surround sound, interactive television and more. EchoStar Technologies Corporation designs, distributes and oversees the manufacturing of DBS set-top boxes, antennas and other digital equipment for DISH Network and various international customers that include Bell ExpressVu Canada and the VÌa Digital system in Spain. ETC provides construction, oversight and project integration services for customers internationally. ETC also oversees EchoStar Data Networks Corporation in Atlanta, Georgia, a leading supplier of MediaStreamô technology for distributing Internet content over satellite networks. Satellite Services provides the delivery of interactive video, audio and data services to business television customers and other satellite users. These services include satellite uplink, satellite transponder space usage and other services. Satellite Services also administers Sky Vista, a direct broadcast satellite service offering popular digital satellite television programming to viewers in Alaska, Hawaii, Puerto Rico and the US territories in the Caribbean.

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