# If I lease the equipment, why $299?



## dlhuse (Apr 3, 2006)

OK, this may be a stupid question but, if we are only leasing the equipment (VIP622 DVR) why is there a $299 charge?
Is it like a deposit? 
Co-payment? 

What gives?


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## tomcrown1 (Jan 16, 2006)

nope Dish keeps the $299. The caharge is to make sure Dish gets at least the money it cost to produce the box.


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## BobaBird (Mar 31, 2002)

The lease fee on the $700 622 is $6 and on the $100 311 it's $5. If you paid the same nothing down as for a 311 the monthly lease would have to be higher (option not available).


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## socceteer (Apr 22, 2005)

dlhuse said:


> OK, this may be a stupid question but, if we are only leasing the equipment (VIP622 DVR) why is there a $299 charge?
> Is it like a deposit?
> Co-payment?
> 
> What gives?


The $299 is to recover the cost of the receiver upfront. It probably cost that much to manufacture and the $6 a month lease is most-likely profit, even though they will not admit this. Trust me ...you will see other people responding to this comment and they will be offended that I say that.

I guess if I was on their shoes I will do anything I can get away with charging for everything I can.


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## Bill R (Dec 20, 2002)

socceteer said:


> The $299 is to recover the cost of the receiver upfront. It probably cost that much to manufacture and the $6 a month lease is most-likely profit, even though they will not admit this. Trust me ...you will see other people responding to this comment and they will be offended that I say that.


I'm not offended by what you say but I really don't think that you have any idea of what you are talking about. If you think that Echostar can manufacture the 622 for $299 you ought to look at what is inside the receiver and the price of those components. And don't forget to add in the cost of R & D which often adds quite a bit to the price of a product.


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## CCarncross (Jul 19, 2005)

dlhuse said:


> OK, this may be a stupid question but, if we are only leasing the equipment (VIP622 DVR) why is there a $299 charge?
> Is it like a deposit?
> Co-payment?
> 
> What gives?


Because they actually cost alot more than $299.....


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## bill94 (Mar 27, 2006)

It's better than D*, they want $499 upfront and that's for an mpeg2 hddvr.


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## Rogueone (Jan 29, 2004)

socceteer said:


> The $299 is to recover the cost of the receiver upfront. It probably cost that much to manufacture and the $6 a month lease is most-likely profit, even though they will not admit this. Trust me ...you will see other people responding to this comment and they will be offended that I say that.
> 
> I guess if I was on their shoes I will do anything I can get away with charging for everything I can.


in a year or two, this assumption will likely be correct. right now, you can pretty much bet money that the cost of the 622 is $299 + the majority of the $240 service cancellation fee (part of that would also cover sending someone to collect the dish and switches). likely, the reason for an 18 month commit and not a 12 or 24 month commit is, $6x18 + $299 is likely roughly the cost of the unit. If Dish can get you to pay for 18 months of service, they are at the break even as far as the box is concerned (but have made money on the package itself). At that point, they start making a profit on the 622. But this is only if the lease fee is charged. there won't be a lease fee paid for every 622 out there (it's built into the package price in some cases, in others the 622 is a 2nd receiver so there would be the lease charge, etc.).


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## DP1 (Sep 16, 2002)

CCarncross said:


> Because they actually cost alot more than $299.....


Dont the ones the cable co's offer cost more than that too? So how can they offer theirs with nothing upfront... not to mention with no commitments?

Must be just because one wants to do it that way and one doesnt.


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## the_bear (Oct 18, 2004)

Once my local cable company has an HD lineup as good as Dish, I’m sure the Dish HD DVRs will be $0 up-front.


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## harsh (Jun 15, 2003)

dlhuse said:


> OK, this may be a stupid question but, if we are only leasing the equipment (VIP622 DVR) why is there a $299 charge?


In the auto industry, this is known as a "drive-off" fee. For example, I'll use a BMW 325i which is a very popular lease car. The drive-off fee is as follows:

First month's rent $389
Security deposit $400
Downpayment $2,500

So to "drive-off" the lot in the car, you must cough up $3,289 cash.

With satellite equipment, the expected lifetime is much shorter than that of an automobile, so they probably feel justified in charging a greater percentage up front.

As we all know, drive off has another meaning and if you feel the charge is too much, you can certainly opt to buy a ViP622 for just under $800 and hope that it meets your needs for some time to come.


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## CCarncross (Jul 19, 2005)

DP1 said:


> Dont the ones the cable co's offer cost more than that too? So how can they offer theirs with nothing upfront... not to mention with no commitments?
> 
> Must be just because one wants to do it that way and one doesnt.


Many cable companies are so desperate to try to reduce their churn they're willing to do anything, except offer a better service at a reasonable price...one of the many reasons so many of us switched from cable years ago.....

And in many ways, they still havent gotten the hint....


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## Paradox-sj (Dec 15, 2004)

The 299.00 is Cap Cost...They have it becasue YOU will pay it...that simple


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## DP1 (Sep 16, 2002)

CCarncross said:


> Many cable companies are so desperate to try to reduce their churn they're willing to do anything, except offer a better service at a reasonable price...one of the many reasons so many of us switched from cable years ago.....
> 
> And in many ways, they still havent gotten the hint....


Well fine. But thats completely different than "Because they cost a lot more than $299".

In other words, isnt Paradox right then.. since the cable offers such an inferior product, Charlie with his, uh, best thing goin, just charges that much... because he can.


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## DougRuss (Oct 16, 2005)

tomcrown1 said:


> nope Dish keeps the $299. The caharge is to make sure Dish gets at least the money it cost to produce the box.


And when your All Done......you turn in their Equipt....plus they Keep the $299 ! 
And the Landlord also Keeps the RENT you paid for using their Equipt. !:lol:


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## kb7oeb (Jun 16, 2004)

I came across a list somewhere for what cox cable charges if you lose their SA8300HD cable box. Depending on where you live the fee is $400 to $600. While it doesn't offer the same features as the 622 I think its similar. It has two tuners,two analog encoders, hard drive, discrete video output and the ability to stream video to non-dvr cable boxes.

(The discrete outputs is only implemented as a vcr recording feature but the hardware cost is probably similar)


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## socceteer (Apr 22, 2005)

Bill R said:


> I'm not offended by what you say but I really don't think that you have any idea of what you are talking about. If you think that Echostar can manufacture the 622 for $299 you ought to look at what is inside the receiver and the price of those components. And don't forget to add in the cost of R & D which often adds quite a bit to the price of a product.


I am factoring the R & D as part of the cost. You can go to Bestbuy today and buy an incredibly fast desktop with monitor, keyboard and mouse, + software for about $600. I am sure that desktop computer can handle 6 times more than the 622. More peripherals, more software, same disk space, etc. plus it is expandable.

Also I hope they did not spend too much money on the "R" (research), they just have to compare it to Tivo. As far as I am concerned they are the benchmark .


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## LtMunst (Aug 24, 2005)

socceteer said:


> You can go to Bestbuy today and buy an incredibly fast desktop with monitor, keyboard and mouse, + software for about $600. I am sure that desktop computer can handle 6 times more than the 622.


Show me one $600 desktop that could display 1 HD + 1 SD video simultaneously to multiple outputs, while at the same time downloading 3 realtime HD feeds and offloading to USB 2.0.


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## bighifi (Aug 11, 2004)

Well if cost for manufacture is the reason, why does comcast lease me a HD-DVR for only 9.00 bucks a month. The technology is not that much different. That 300 bucks is the only reason I stay with Comcast. I know that they do not offer as much HD as dish, but I mostly watch the network HD anyway (dish does not currently offer this, without an antenna).


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## socceteer (Apr 22, 2005)

LtMunst said:


> Show me one $600 desktop that could display 1 HD + 1 SD video simultaneously to multiple outputs, while at the same time downloading 3 realtime HD feeds and offloading to USB 2.0.


That is all the receiver does.

I can use a computer to record, can you use the recorder as a computer...? "NO" you may be able to surf the internet and that is all.

Show me a DVR that can run any software program at the same time that it burns a DVD and write a document, while you create a spreadsheet and alter your pictures, while other pictures are printing.....on and on and on.

Should I continue to mention all other things that a computer can do that a DVR does not...?


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## socceteer (Apr 22, 2005)

bighifi said:


> Well if cost for manufacture is the reason, why does comcast lease me a HD-DVR for only 9.00 bucks a month. The technology is not that much different. That 300 bucks is the only reason I stay with Comcast. I know that they do not offer as much HD as dish, but I mostly watch the network HD anyway (dish does not currently offer this, without an antenna).


Dish sales people will claim that it is because Comcast will go out of business if they do not give you the box for $9..!


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## rbyers (Jan 15, 2004)

Seems to me that there are lot more cheap computers than DVRs made these days. A DVR is just a cheap computer with a bunch of special purpose hardware tacked on. I'll opine, without any first hand knowledge, that much of the cost is in the special purpose hardware. And, in the big disks. While big disks are dropping in price they are still a tad pricey ... at least when compared to the disks in the cheapo computers. And, don't forget, they still have to provide HD video out ... not done on the cheapo computers. Start raising the resolution on video output for standard computers and the video card price climbs very quickly. Processor/memory/standard support chips are cheap and there is massive integration so that the total chip count is very low. 

And, I would hazard a guess that bringing in, and recording on the HD, three high data rate streams takes some doing. I cannot backup my company's SQL Server database during the day without taking our ERP program down. That's about 13GB and it swamps the network for half an hour. Your DTV is not as flexible as a general purpose computer, but it will handle 4 HD datastreams simulataneously. This is something that the typical HTPC cannot do. 

My point is, don't bash the Dish box out of hand. I'm sure that these guys are absolute dolts, but overall I'd believe that the HD DVR is comparable in cost to a mid range general purpose computer.


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## Stewart Vernon (Jan 7, 2005)

bighifi said:


> Well if cost for manufacture is the reason, why does comcast lease me a HD-DVR for only 9.00 bucks a month. The technology is not that much different. That 300 bucks is the only reason I stay with Comcast. I know that they do not offer as much HD as dish, but I mostly watch the network HD anyway (dish does not currently offer this, without an antenna).


One not-so-obvious reason... is that Comcast can come to your house more easily and ask for their receiver back if/when you cancel. Dish has to go through a bit more of a hassle since they are not sitting in your home town with a staff of workers.


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## Mike123abc (Jul 19, 2002)

I think a lot more people would have been happier if Dish were to lease the 622 for $0 down and $10-$15 or so a month instead of $299 and $6/month.

You are essentially "buying down" the lease payment to $6/month.

The extra receiver fee is a high margin item, but it is not $0 cost to dish. In a lot of cases you are just covering their cost of the extra receiver since you get them for free when you sign up. Eventually they will $5/month you enough to make a profit.

The extra receiver fee is just really annoying when you buy a receiver and own it and still have to pay the fee.


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## Stewart Vernon (Jan 7, 2005)

Since they are going to charge you the $6 whether you lease or own... you can't count it that way.

The only way to count it would be if you said:

Do you want to pay $299 up front OR add $16.61 more to your "lease" payment each month?

I got the $16.61 by dividing the $299 by the 18-month commitment that they seem to be asking for on the lease upgrade to the ViP622.

I doubt Dish would trade the $299 up front for only $5-$10 more a month for the 18-month lease agreement... since they seem to want some guaranteed money in exchange for the receiver.

Perhaps some folks would bite on a $16.61 + $6 per month lease fee... but I suspect most folks would rather pay the $299 and forget about it, and just have the $6 per month and pretend like the $299 never happened after a couple of months pass.

Me, I'm still torn on do I want a DVR that badly to pay $299... or can I live with no DVR and just get a 211 so I can have the new channels. I can't afford the $299 right now, so on I wait.


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## Rogueone (Jan 29, 2004)

in regards to cable, you are forgetting how much of a cash cow cable is. I have friends at TWC, TW turns a profit starting about August each year, so the employees always get nice end of the year bonuses and raises. Cable co's can offer the box free because they don't change their stuff often, and they expect to collect that $10/month per box for 10 years or more. that's pretty much their mentality if you look back over the years. 

Dish realizes the 622 isn't going to be around 10 years, 5 is probably tops as a main sell unit. They wouldn't be able to recoup the costs without a large monthly nut otherwise. Also, for that $299 you are forgetting it includes the cost of an installer, cabling, DPP lnbs and switches, D1000's, etc. Granted, some of us don't need any of that, so Dish can take your $299 and offset someone elses install, keeping prices down. Otherwise, the guy with the install might be paying $500 while those with everything pay only $100. Since the deal includes everything needed, you have to factor that in as well. For a new customer install, what would you figure, $200 at least for the other parts of the install? D1000, dpp44, dpp lnb, wiring. isn't a dpp44 ove $100 normally? 

All dish did was not seperate the install from the unit price in the deal, so we can't ask for it back, so they could keep the overall price lower as everyone upgrading is paying regardless. after a short period of time, 6 months maybe, we'll see cheaper packages. we are paying a premium to be early adopters of HD programming. it's no differnt really that what will happen when Blu-ray hits and it's $1500 for a cheap box, and 2 years later a better box will be $500. The extra $1000 was your fee for early adoptation. 

So, keep in mind the fees with cable. Their monthly bill is higher in most places, their monthly box price is more per month per box. that's why they don't need up front money


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## kb7oeb (Jun 16, 2004)

LtMunst said:


> Show me one $600 desktop that could display 1 HD + 1 SD video simultaneously to multiple outputs, while at the same time downloading 3 realtime HD feeds and offloading to USB 2.0.


Its not very taxing to record HD, its just moving data around at 10 to 19 Mb. The more expensive parts in a DIY setup is the tuners and a decent video card that will handle HD MPEG2 in hardware, but I don't think its fair to compare the costs with retail parts when dish is building in bulk


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## Rogueone (Jan 29, 2004)

kb7oeb said:


> Its not very taxing to record HD, its just moving data around at 10 to 19 Mb. The more expensive parts in a DIY setup is the tuners and a decent video card that will handle HD MPEG2 in hardware, but I don't think its fair to compare the costs with retail parts when dish is building in bulk


do keep in mind, Dish's bulk is NOTHING compared to the place making the computer. someone like Dell or HP is going to have some cost advantages, but Dish looses those cost advantages on parts like the harddrive when they design a custom piece of equipment. A 622 isn't an off the shelf item in the same sense a PC is. So Dish has to request special runs from the factory on cases, chassis, etc., and it's not like it's cost effective to make those orders in the hundreds or thousands. In order to be cost effective, they've gotta be ordering in the tens of thousands. But this also means they have to hold a bunch in inventory while they sell.

it doesn't seem logical these boxes would cost less than $300-400 to make. Xbox 360s are suppose to be in the $600+ range, and a couple months ago I saw an article mentioning the PS3 was expected to be $900 cost. takes a while for that kind of cost to drop, and the companies have to make enough money to keep things going. I don't think the 622 costs $600, but mid 400's I think are reasonable.


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## harsh (Jun 15, 2003)

Take a good look at a modern cable DVR. The backplane looks remarkably like an ATX setup.


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