EchoStar Drops ‘Sage’ Home Security/Automation Product Line

EchoStar president Mark Jackson leaving company, to be succeeded by Dish CTO Vivek Khemka (Updated)
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There are big changes afoot at EchoStar, Dish Network’s technology and set-top spin-off, as the company has decided to exit the retail home security/automation market while also announcing that long-time president Mark Jackson is leaving the company to pursue other opportunities.

EchoStar made note of Jackson’s departure in this SEC filing. Jackson, who joined EchoStar/Dish in 1993 as director of engineering, has been president of EchoStar Technologies since 2004, and has played a major role in product development at the company through the years.

“The entire EchoStar management team wishes Mark the best and we’ll miss his friendship and contribution,” Mike Dugan, EchoStar’s CEO, said Tuesday on the company’s Q2 earnings call.

Dugan said he has Vivek Khemka, recently promoted to CTO at Dish Network (from SVP of product management), to succeed Jackson, and will be transitioning between roles “over the next few months.”  Dish has been asked if it has yet named a successor CTO. 

Update: Dish confirmed that Khemka will remain CTO of Dish and will be an employee of both companies. Satellite Business News reported Monday (August 8) that EchoStar informed the 100 to 150 employees who worked in Atlanta-based Sage facility that they would be losing their jobs as a result of the decision to shut down the product line.

Dugan said the decision to discontinue its Sage By Hughes product represents an “initial cut” as EchoStar looks to focus on “areas that we are confident will produce positive bottom line impact.”

EchoStar didn’t give Sage much time to resonate in the market. Sage By Hughes was launched as a retail, do-it-yourself product in March, and later announced support for products from Google’s Nest division.  A key cog in Sage’s engine is a “hub” that connects to TVs. EchoStar has not release any sales figures on Sage, which had been selling a basic Starter Kit for $199.99 along other packages and platform accessories that can be purchased separately.

“Although the product had a number of groundbreaking features, a dramatic change in the competitive landscape, heavily impacted our chance of this product [to achieve] a significant positive long-term results for EchoStar,” Dugan said.

Dugan later said the decision to get out of that business comes amid the rise of general competition and amid the emergence of small startups that have come on the scene. He said it was deemed more prudent to focus on other parts of EchoStar’s business.

“I still think the product has potential. It has some great features and so on but for EchoStar we just weren't ready to proceed with that at this time,” he said. “ETC will continue to develop consumer-facing products and we will take some hard lessons learned from our SAGE efforts,” citing other recently introduced products for Dish such as the HopperGO and voice remote.

EchoStar’s decision to exit home security and automation also comes as Comcast looks to double down its efforts following its recent deal to acquire a big piece of Icontrol. For a more detailed look at how service providers are targeting the smart home market, see this week’sMultichannel News cover story (subscription required).

Dugan said EchoStar will also “continue to heavily invest and develop the Sling TV service,” referring to Dish’s OTT-TV service.

EchoStar posted Q2 revenues of $757.62 million, down from $793.59 million in the year-ago quarter, and net income of $55.9 million, up from $31.01 million.

EchoStar Technology revenues dropped from $315 million to $332 million due to lower equipment sales to Dish and international customers, but were partly offset to increases in billing to Dish to support Sling TV and other engineering services.