UPDATE, 11:00 AM: No Charlie Ergen on today’s earnings call. But Dish Network’s new CEO Joe Clayton did an admirable job of playing cat-and-mouse with analysts who want to know whether the company will use Blockbuster and the wireless spectrum it’s acquiring to create a mega-video streaming service that wouldn’t have to go through cable’s broadband pipes. “We will be somewhat nebulous,” Clayton said. “We will not tip our hand.” Still he offered clues that suggest something big is afoot. With its recent deals Dish is “systematically developing the building blocks” for its new initiative. “Video is our primary objective,” he says adding that it’s “extremely important to us” for consumers to have a broadband-connected set top box. He says the company’s considering additional acquisitions, partnerships and asset sales. Dish also is talking with Hollywood studios about different licensing arrangements for Blockbuster that could include subscription VOD. “We’ll look at it on a case-by-case basis for each studio,” says Tom Cullen, who’s in charge of business development. In any event, Dish doesn’t plan to unveil anything soon: It will wait until federal officials approve some of its spectrum acquisitions.

As for Dish’s satellite TV business, Clayton says “it has underperformed.” The company may have tried too hard to cut back on subscribers with so-so credit who might stop paying their bills. “I’m looking for a better class of customer,” Clayton says. A big part of his strategy is to “force the customer to move up to better [i.e. more expensive] packages.” Dish will roll out a new marketing campaign with a “more emotional, experience-based message.” But the pick up in revenues and subscriptions likely won’t take place until the end of 3Q, Clayton says. Dish shares are down 3.6% at mid-day.
PREVIOUS, 4:00 AM: The big questions for Dish Network have more to do with its mysterious plans for Blockbuster and the massive amount of spectrum it has been acquiring than how well it did in 2Q. But until chairman Charlie Ergen unveils his strategy, all the Street has to go on is how well the No. 2 satellite company is performing. And the 2Q numbers are mixed, at best. The company reported net earnings of $334.8M, up 30.3% vs the period last year, on revenues of $3.59B, up 13.3%. The revenue figure includes nearly $254M from Blockbuster. Yet Dish earnings, at 75 cents a share, missed analysts’ consensus estimate of 79 cents — although revenues beat the $3.4B target. Meanwhile, Dish lost 135,000 subscribers, ending with 14.06M. “As we look forward to the second half of the year, we will focus on commercializing our technology, re-energizing our distribution channels and strengthening our brand image,” says Dish Network CEO Joe Clayton. The company says it will freeze consumer prices through January 2013.

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