EchoStar is following up where DirecTV left off, posting weaker-than-expected subscriber numbers for 2Q. The DBS operator added 195K subs compared to 225K in 1Q, according to an SEC filing ahead of today’s conference call. "Of note, total DBS industry (including DirecTV results earlier this week) subscriber additions of 320K slowed vs 480K reported in 1Q06 and 450K in 2Q05, likely due to competitive dynamics," UBS’ Aryeh Bourkoff wrote in a research note. DISH’s net income was $168.8mln for the Q vs $855.5mln a year ago. The decrease is primarily the result of a reversal of its recorded valuation allowance for deferred tax assets in the ’05. In other bad news, DISH said it may start shutting off its distant network channels in 3Q following a broadcast injunction. "Those shut offs could have a material impact on our results for the Q," the filing said. Revenue from distant networks is less than $5 per distant network sub per month, with less than 1mln subs purchasing distant network signals, DISH said. But the company noted that the shutoffs would reduce avg monthly rev per sub, free cash flow and temporarily increase churn. Wed’s SEC filing came after market close on what was a pretty tough day for EchoStar. Sanford C. Bernstein downgraded it and DirecTV to "underperform." DISH took the biggest hit, with shares closing down 10%. DirecTV was down 3%. "Yesterday’s contrasting results from DirecTV and competitor Cablevision paint a picture of competitive advantage swinging decisively towards cable; DirecTV’s subscriber growth was sharply below expectations, even as Cablevision was raising basic subscriber guidance," Bernstein said. The firm also noted that merger speculation had pushed the stocks to new heights, leaving valuations stretched as huge questions remain about the possibility of a merger. Other Metrics: DISH revenue grew 17.2% to $2.46bln. Churn of 1.7% was almost flat with 1Q.