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DISH Network Corp.’s (DISH - Analyst Report) Puerto Rican subsidiary and America Movil S.A.B. de C.V. (AMX - Analyst Report)-owned Claro Puerto Rico have joined forces to offer bundled services in Puerto Rico. The two subsidiaries aim to offer bundled pay-TV, Internet, wireless and fixed line services at an affordable rate.

Notably, DISH and Claro are the largest pay-TV and telecom operators in the island country.  The service will be available at select DISH and Claro retail locations from mid Aug 2013. Customers will receive a single bill for the bundled offering.

DISH is the only pay-TV operator in Puerto Rico which offers more than 100 HD channels and an innovative HD whole-home DVR called “Hopper”. Hooper enables users to watch TV shows and movies in 4 different rooms at the same time and record 6 HD shows simultaneously. Additionally, Hooper also includes AUTO HOP features, which enable DISH’s Puerto Rican customers to record up to 500 hours of HD programming. On the other hand, Claro Puerto Rico offers voice data and cable TV services.  America Movil acquired Claro Puerto Rico from Verizon Communications Inc. (VZ - Analyst Report) in 2007.

Telecom operators are quickly gaining market share from satellite TV providers by offering fiber-based TV service. Moreover, online video streaming service providers, such as Netflix Inc. (NFLX - Analyst Report), Hulu.com and YouTube threaten pay-TV operators with their cheaper source of programming.

In order to reduce the competitive pressure in the domestic market, the satellite TV operators are expanding their operations in Latin American countries, where pay-TV penetration is still quite low.

The DISH-Claro tie-up will offer the combined benefits of high-speed Internet and HD channels to the customers. The partnership will put DISH in an advantageous position over its arch rival, DIRECTV, which also has a presence in Puerto Rico.   

DISH currently carries a Zacks Rank #3 (Hold).

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