Question-and-Answer Session
Operator:
(Operator Instructions) You have one question from the line of Kunal Madhukar - Bear Stearns.
Kunal Madhukar-Bear Stearns
On the new European markets, how much funding do you think you will need to get the ball rolling and to get to a point where you can say you are free cash flow breakeven for Switzerland, as well as for the new market that you expect over the next 30 days?
Sridhar Ganesan
Typically, the funding, the actual cash need at the parent company level is really going to be driven by some of the partnerships that we bring it as we begin the rollout. And those partners could contribute content, they could contribute other forms of infrastructure including the terrestrial repeater that could reduce the cost.
We have not given previously the actual cash funding on a market-by-market basis, but typically I would say that depending upon the factors it would be anywhere from $100 to $150 or even $200 million in the case of some of the bigger markets like Germany. But that would be the range but again, it’s going to be driven by the cost related to repeaters, content development, and uplink, what kind of contributions we are going to get from the [break in audio].
The other things to take into consideration is whether we have a major anchor partner in Europe that already has lot of the infrastructure which is going to reduce the cost. One thing that I can say is that as part of the European development, the Italian developments specifically, we have spent a lot of money on developing the technology, so we won’t have to as Noah said earlier a lot of that is already in place.
Whether it is chipset or product development or repeated development and to that extent, the costs are going to be much lower. Again also from an OEM manufacture standpoint, a lot of the things that we are doing in Italy is going to be very applicable.
Studio infrastructure, uplink infrastructure, a variety of these kinds of expenses, we are going to be able to parlay to some extent into those markets. But again on a case-by-case basis as we begin the rollout in these markets driven by what the market research shows that we would have to do, especially as we rollout in the aftermarket [break in audio].
That’s going to drive some of the cash need and what the partners bring to that. But I would say we think it could be in the $100 to $200 million net, not to the parent company but overall. And that’s going to be really determined by what the partners bring to that.
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