<PAGE>

                                                                   EXHIBIT 99.4

                                       
                      QUARTERLY REPORT FOR THE PERIOD ENDED
                                 MARCH 31, 1998

           CONDENSED COMBINED AND CONSOLIDATED FINANCIAL STATEMENTS OF
                                  ECHO SATELLITE
  (A COMBINATION OF CERTAIN WHOLLY-OWNED SUBSIDIARIES OF ECHOSTAR COMMUNICATIONS
                        CORPORATION, AS DEFINED IN NOTE 1)


              5701 S. SANTA FE DRIVE
                LITTLETON, COLORADO                         80120
     (Address of principal executive offices)            (Zip code)
                                       
                                 (303) 723-1000
                    (Telephone number, including area code)


<PAGE>

                               TABLE OF CONTENTS

                         PART I - FINANCIAL INFORMATION

<TABLE>
<S>      <C>                                                                        <C>
Item 1.  Financial Statements

         Condensed Combined and Consolidated Balance Sheets -
           December 31, 1997 and March 31, 1998 (Unaudited).......................   1

         Condensed Combined and Consolidated Statements of Operations for the
           three months ended March 31, 1997 and 1998 (Unaudited).................   2

         Condensed Combined and Consolidated Statements of Cash Flows for the
           three months ended March 31, 1997 and 1998 (Unaudited).................   3

         Notes to Condensed Combined and Consolidated Financial Statements
           (Unaudited)............................................................   4

Item 2.  Management's Narrative Analysis of Results of Operations.................   8

Item 3.  Quantitative and Qualitative Disclosures About Market Risk...............  None


                            PART II - OTHER INFORMATION


Item 1.  Legal Proceedings........................................................  11

Item 2.  Changes in Securities and Use of Proceeds................................   *

Item 3.  Defaults Upon Senior Securities..........................................   *

Item 4.  Submission of Matters to a Vote of Security Holders......................   *

Item 5.  Other Information........................................................  None

Item 6.  Exhibits and Reports on Form 8-K.........................................   N/A

</TABLE>

     DISH NETWORK-SM- IS A SERVICE MARK OF ECHOSTAR COMMUNICATIONS CORPORATION.


------------------------------
(*)  This item has been omitted pursuant to the reduced disclosure format 
     as set forth in General Instructions (H)(1)(a) and (b) of Form 10-Q.

<PAGE>
                                       
                                ECHO SATELLITE
  (A COMBINATION OF CERTAIN WHOLLY-OWNED SUBSIDIARIES OF ECHOSTAR COMMUNICATIONS
                       CORPORATION, AS DEFINED IN NOTE 1)
                CONDENSED COMBINED AND CONSOLIDATED BALANCE SHEETS
                             (Dollars in thousands)

<TABLE>
<CAPTION>
                                                                                     DECEMBER 31,    MARCH 31,
                                                                                         1997           1998
                                                                                    ----------------------------
                                                                                                     (Unaudited)
<S>                                                                                   <C>            <C>
ASSETS
Current Assets:
  Cash and cash equivalents.......................................................... $   45,653     $   13,324
  Trade accounts receivable, net of allowance for uncollectible accounts of $1,347
    and, $1,673 respectively.........................................................     66,045         82,553
  Inventories........................................................................     22,993         34,643
  Subscriber acquisition costs, net..................................................     18,819          7,848
  Other current assets...............................................................      9,424          7,758
                                                                                      --------------------------
Total current assets.................................................................    162,934        146,126
Restricted cash and marketable investment securities.................................      2,245          2,245
Property and equipment, net..........................................................    597,755        605,498
Advances to affiliates, net..........................................................    161,222        169,969
Other noncurrent assets..............................................................    118,747        117,859
                                                                                      --------------------------
    Total assets..................................................................... $1,042,903     $1,041,697
                                                                                      --------------------------
                                                                                      --------------------------
LIABILITIES AND  STOCKHOLDER'S EQUITY (DEFICIT)
Current Liabilities:
  Trade accounts payable............................................................. $   68,800     $   64,096
  Deferred revenue...................................................................    122,215        113,066
  Accrued expenses...................................................................     72,605        102,374
  Current portion of long-term debt..................................................     17,885         18,186
                                                                                      --------------------------
Total current liabilities............................................................    281,505        297,722

Long-term obligations, net of current portion:
  1994 Notes.........................................................................    499,863        516,829
  1996 Notes.........................................................................    438,512        452,405
  Notes payable to ECC including accumulated interest................................     54,597         55,883
  Mortgages and other notes payable, net of current portion..........................     51,846         47,520
  Long-term deferred satellite services revenue and other long-term liabilities......     19,500         22,464
                                                                                      --------------------------
Total long-term obligations, net of current portion..................................  1,064,318      1,095,101
                                                                                      --------------------------
    Total liabilities................................................................  1,345,823      1,392,823

Commitments and Contingencies (Note 4)

Stockholder's Equity (Deficit):
  Common Stock, $.01 par value, 2,000 shares authorized, issued and outstanding......          -              -
  Additional paid-in capital.........................................................    125,162        125,162
  Accumulated deficit................................................................   (428,082)      (476,288)
                                                                                      --------------------------
Total stockholder's equity (deficit).................................................   (302,920)      (351,126)
                                                                                      --------------------------
    Total liabilities and stockholder's equity (deficit)............................. $1,042,903     $1,041,697
                                                                                      --------------------------
                                                                                      --------------------------
</TABLE>
                                                                              
    See accompanying Notes to Condensed Combined and Consolidated Financial 
                                 Statements.

                                       1
<PAGE>

                                  ECHO SATELLITE
  (A COMBINATION OF CERTAIN WHOLLY-OWNED SUBSIDIARIES OF ECHOSTAR COMMUNICATIONS
                        CORPORATION, AS DEFINED IN NOTE 1)
           CONDENSED COMBINED AND CONSOLIDATED STATEMENTS OF OPERATIONS
                                 (In thousands)
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                           THREE MONTHS ENDED MARCH 31,
                                                          ------------------------------
                                                                1997           1998
                                                          ------------------------------
<S>                                                       <C>              <C>
REVENUE:
  DISH Network:
    Subscription television services......................     $  48,050      $128,541
    Other.................................................         8,206         6,184
                                                            ----------------------------
  Total DISH Network......................................        56,256       134,725
  DTH equipment sales and integration services............         1,958        66,816
  Satellite services......................................         2,165         4,595
  C-band and other........................................         8,588         7,888
                                                            ----------------------------
Total revenue.............................................        68,967       214,024

COSTS AND EXPENSES:                                          
  DISH Network Operating Expenses:                           
    Subscriber-related expenses...........................        23,040        63,809
    Customer service center and other.....................         6,445        11,733
    Satellite and transmission............................         2,785         5,252
                                                            ----------------------------
  Total DISH Network operating expenses...................        32,270        80,794
  Cost of sales - DTH equipment and integration services..         2,228        47,251
  Cost of sales - C-band and other........................         6,008         5,942
  Marketing:                                                    
    Subscriber promotion subsidies........................        12,777        44,835
    Advertising and other.................................         3,276         8,250
                                                            ----------------------------
  Total marketing expenses................................        16,053        53,085
  General and administrative..............................        15,031        19,289
  Amortization of subscriber acquisition costs............        28,062        10,971
  Depreciation and amortization...........................        12,643        15,419
                                                            ----------------------------
Total costs and expenses..................................       112,295       232,751
                                                            ----------------------------

Operating loss............................................       (43,328)      (18,727)

Other Income (Expense):                                       
  Interest income.........................................         1,649           773
  Interest expense, net of amounts capitalized............       (21,199)      (29,988)
  Other...................................................           (60)          (93)
                                                            ----------------------------
Total other income (expense)..............................       (19,610)      (29,308)
                                                            ----------------------------
Loss before income taxes..................................       (62,938)      (48,035)
Income tax provision, net.................................           (19)         (171)
                                                            ----------------------------
Net loss..................................................     $ (62,957)     $(48,206)
                                                            ----------------------------
                                                            ----------------------------
</TABLE>

    See accompanying Notes to Condensed Combined and Consolidated Financial 
                                  Statements.

                                       2
<PAGE>

                                ECHO SATELLITE
  (A COMBINATION OF CERTAIN WHOLLY-OWNED SUBSIDIARIES OF ECHOSTAR COMMUNICATIONS
                         CORPORATION, AS DEFINED IN NOTE 1)
            CONDENSED COMBINED AND CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (In thousands)
                                 (Unaudited)

<TABLE>
<CAPTION>
                                                                                           THREE MONTHS ENDED MARCH 31,
                                                                                           -----------------------------
                                                                                                 1997           1998
                                                                                           -----------------------------
<S>                                                                                         <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss..................................................................................    $(62,957)      $(48,206)
Adjustments to reconcile net loss to net cash flows 
  from operating activities:              
  Depreciation and amortization...........................................................      12,643         15,419
  Amortization of subscriber acquisition costs............................................      28,062         10,971
  Amortization of debt discount and deferred financing costs..............................      18,542         27,183
  Interest on notes payable to ECC added to principal.....................................       1,337          1,286
  Change in reserve for excess and obsolete inventory.....................................      (2,302)           (33)
  Change in long-term deferred satellite services revenue 
    and other long-term liabilities.......................................................       3,090          3,015
  Other, net..............................................................................        (125)           (51)
  Changes in current assets and current liabilities, net..................................     (29,560)       (20,096)
                                                                                            ----------------------------
Net cash flows from operating activities..................................................     (31,270)       (10,512)
                                                                                           
CASH FLOWS FROM INVESTING ACTIVITIES:                                                      
Purchases of marketable investment securities                                              
Sales of marketable investment securities.................................................      15,279              -
Purchases of restricted marketable investment securities..................................      (1,995)             -
Funds released from escrow and restricted cash and marketable investment securities.......      30,000              -
Investment earnings placed in escrow......................................................        (416)             -
Purchases of property and equipment.......................................................     (16,365)       (17,000)
Other.....................................................................................        (453)          (792)
                                                                                            ----------------------------
Net cash flows from investing activities..................................................      26,050        (17,792)
                                                                                           
CASH FLOWS FROM FINANCING ACTIVITIES:                                                      
Repayments of mortgage indebtedness and notes payable.....................................      (3,130)        (4,025)
                                                                                            ----------------------------
Net cash flows from financing activities..................................................      (3,130)        (4,025)
                                                                                            ----------------------------
Net decrease in cash and cash equivalents.................................................      (8,350)       (32,329)
Cash and cash equivalents, beginning of period............................................      38,429         45,653
                                                                                            ----------------------------
Cash and cash equivalents, end of period..................................................    $ 30,079       $ 13,324
                                                                                            ----------------------------
                                                                                            ----------------------------
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest, net of amounts capitalized........................................    $    612       $  1,409
Cash paid for income taxes................................................................           -            171
Capitalized interest, including amounts due to affiliates.................................       8,013          4,351
Accrued capital expenditures..............................................................           -          4,653
The purchase price of DBSC was pushed-down by EchoStar Communications Corporation to       
  DBSC as follows in the related purchase accounting:
    Satellite construction costs..........................................................      51,241              -
    FCC authorization.....................................................................      16,651              -
    Notes payable to EchoStar, including accrued interest of $3,382.......................     (49,382)             -
    Trade accounts payable and accrued expenses...........................................      (1,687)             -
    Other notes payable...................................................................        (500)             -
    Additional paid in capital............................................................     (16,323)             -

</TABLE>
                                       
      See accompanying Notes to Condensed Combined and Consolidated Financial 
                                  Statements.

                                       3
<PAGE>

                                   ECHO SATELLITE
  (A COMBINATION OF CERTAIN WHOLLY-OWNED SUBSIDIARIES OF ECHOSTAR COMMUNICATIONS
                         CORPORATION, AS DEFINED IN NOTE 1)
         NOTES TO CONDENSED COMBINED AND CONSOLIDATED FINANCIAL STATEMENTS
                                    (Unaudited)

1.   ORGANIZATION AND BUSINESS ACTIVITIES

PRINCIPAL BUSINESS

     The following represents Echo Satellite, a combination of EchoStar 
Satellite Broadcasting Corporation ("ESBC") and Direct Broadcasting Satellite 
Corporation, a Colorado corporation ("DBSC").  Both ESBC and DBSC are 
wholly-owned subsidiaries of EchoStar Communications Corporation ("ECC," and 
together with its subsidiaries, "EchoStar"), a publicly-traded company on the 
Nasdaq National Market.  ESBC was formed in January 1996 for the initial 
purpose of completing an offering of $580 million principal amount at 
maturity of 13 1/8% Senior Secured Discount Notes (the "1996 Notes") due 2002 
(the "1996 Notes Offering").  On January 8, 1997, Direct Broadcasting 
Satellite Corporation, a Delaware corporation ("Old DBSC"), was merged (the 
"Merger") with DBSC.  This transaction was accounted for as a purchase and 
the excess of the purchase price over the fair value of Old DBSC's assets was 
allocated to FCC authorizations in the related purchase accounting.  Upon 
consummation of the Merger, Old DBSC, which was incorporated January 23, 1981 
in the State of Delaware, ceased to exist and DBSC became a guarantor of the 
1996 Notes.  DBSC is the FCC licensee for a satellite permit and orbital slot 
assignments and the owner of EchoStar III, a satellite built to become an 
integral part of the DISH Network, but has no operations as a stand-alone 
entity.  DBSC is dependent on ECC and ECC's other subsidiaries for all 
necessary funding and all management and administrative functions.

     The accompanying financial statements represent the combined and 
consolidated financial statements of ESBC and DBSC ("Echo Satellite" or the 
"Company").  Readers of this Quarterly Report should refer to EchoStar's 
Quarterly Report on Form 10-Q for the three months ended March 31, 1998.

     Substantially all of EchoStar's operations are conducted by subsidiaries 
of ESBC.  EchoStar's operations include three interrelated business units:

     -    THE DISH NETWORK - a DBS subscription television service in the 
          United States.  As of March 31, 1998, EchoStar had approximately 
          1.2 million DISH Network subscribers.

     -    TECHNOLOGY - the design, manufacture, distribution and sale of DBS 
          set-top boxes, antennae and other digital equipment for the DISH 
          Network ("EchoStar Receiver Systems"), and the design, manufacture 
          and distribution of similar equipment for direct-to-home ("DTH") 
          projects of others internationally, together with the provision of 
          uplink center design, construction oversight and other project 
          integration services for international DTH ventures.

     -    SATELLITE SERVICES - the turn-key delivery of video, audio and data 
          services to business television customers and other satellite 
          users. These services include satellite uplink services, satellite 
          transponder space usage, and other services.

     Since 1994, EchoStar has deployed substantial resources to develop the 
"EchoStar DBS System."  The EchoStar DBS System consists of EchoStar's 
FCC-allocated DBS spectrum, DBS satellites ("EchoStar I," "EchoStar II," 
"EchoStar III," and "EchoStar IV"), digital satellite receivers, digital 
broadcast operations center, customer service facilities, and other assets 
utilized in its operations.  EchoStar's principal business strategy is to 
continue developing its subscription television service in the U.S. to 
provide consumers with a fully competitive alternative to cable television 
service.

RECENT DEVELOPMENTS

     EchoStar IV was launched on May 8, 1998 from the Baikonur Cosmodrome, 
Kazakhstan.  While initial data indicates the launch was successful, the 
ultimate success of the launch and in-orbit operation of EchoStar IV will not 
be 

                                       4
<PAGE>

                                   ECHO SATELLITE
  (A COMBINATION OF CERTAIN WHOLLY-OWNED SUBSIDIARIES OF ECHOSTAR COMMUNICATIONS
                         CORPORATION, AS DEFINED IN NOTE 1)
   NOTES TO CONDENSED COMBINED AND CONSOLIDATED FINANCIAL STATEMENTS--CONTINUED
                                    (Unaudited)

established for approximately 60 days.  Subject to final agreement between 
the United States and Mexican administration, EchoStar IV will be tested at 
the 127DEG. West Longitude ("WL") orbital location for approximately two 
months, and will then be moved to its operational orbital location at 
119.2DEG. WL.  Together with EchoStar II, it will provide video, audio and 
data services throughout the continental United States.  EchoStar IV also 
will provide video, audio and data services to Alaska and Hawaii.

     Provided EchoStar IV is successfully deployed at 119.2DEG. WL, EchoStar 
plans to relocate EchoStar I, a 16 transponder DBS satellite, from 119DEG. WL 
to 148DEG. WL. EchoStar has a permit, issued by the Federal Communications 
Commission (the "FCC"), for the use of 24 frequencies at the 148DEG. WL 
orbital slot.  The FCC conditionally approved the relocation of EchoStar I to 
148DEG. WL in April 1998. To retain its remaining eight frequencies at 
148DEG. WL, EchoStar must, in accordance with its FCC license, complete 
construction of an additional DBS satellite by December 20, 2000, and that 
satellite must be operational by December 20, 2002.

     Once EchoStar I is operational at the 148DEG. WL orbital location, 
EchoStar plans to expand its local programming initiative to include certain 
of the largest television markets in the Mountain and Pacific time zones, and 
to provide expanded international, niche, educational, business television 
and data services.

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

     The accompanying unaudited condensed consolidated financial statements 
have been prepared in accordance with generally accepted accounting 
principles and with the instructions to Form 10-Q and Article 10 of 
Regulation S-X for interim financial information.  Accordingly, these 
statements do not include all of the information and footnotes required by 
generally accepted accounting principles for complete financial statements.  
In the opinion of management, all adjustments (consisting of normal recurring 
adjustments) considered necessary for a fair presentation have been included. 
All significant intercompany accounts and transactions have been eliminated 
in consolidation.  Operating results for the three months ended March 31, 
1998 are not necessarily indicative of the results that may be expected for 
the year ending December 31, 1998.  For further information, refer to the 
consolidated financial statements and footnotes thereto included in the 
Company's Annual Report filed as Exhibit 99.4 to EchoStar Satellite 
Broadcasting Corporation's Annual Report on Form 10-K for the year ended 
December 31, 1997.  Certain prior year amounts have been reclassified to 
conform with the current year presentation.

PURPOSE OF FINANCIAL STATEMENTS

     Echo Satellite currently is not subject to the reporting requirements of 
Section 13 or 15(d) of the Securities and Exchange Act of 1934 (the "Exchange 
Act").  However, pursuant to the terms of an indenture between ESBC and First 
Trust National Association dated March 25, 1996 (the "Indenture"), Echo 
Satellite is required to provide quarterly and annual reports comparable to 
that which would have been required if Echo Satellite were subject to the 
requirements of Section 13 or 15(d) of the Exchange Act.  Since Echo 
Satellite does not have a separate Commission File Number with the Securities 
and Exchange Commission, Echo Satellite has made these financial statements, 
complete with Management's Narrative Analysis of Results of Operations, 
publicly available. These financial statements were prepared solely to comply 
with the reporting requirements under the Indenture.  For further 
information, refer to the consolidated financial statements and footnotes 
thereto included in EchoStar's Annual Report on Form 10-K filed with the 
Securities and Exchange Commission for the year ended December 31, 1997.

                                       5
<PAGE>

                                   ECHO SATELLITE
  (A COMBINATION OF CERTAIN WHOLLY-OWNED SUBSIDIARIES OF ECHOSTAR COMMUNICATIONS
                         CORPORATION, AS DEFINED IN NOTE 1)
   NOTES TO CONDENSED COMBINED AND CONSOLIDATED FINANCIAL STATEMENTS--CONTINUED
                                    (Unaudited)

USE OF ESTIMATES

     The preparation of financial statements in conformity with generally 
accepted accounting principles requires management to make estimates and 
assumptions that affect the reported amounts of assets and liabilities and 
disclosure of contingent assets and liabilities at the date of the financial 
statements and the reported amounts of revenues and expenses for each 
reporting period.  Actual results could differ from those estimates.

3.   INVENTORIES

     Inventories consist of the following (in thousands):

<TABLE>
<CAPTION>

                                                   DECEMBER 31,   MARCH 31,
                                                       1997      1998
                                                   ------------------------
                                                               (Unaudited)
<S>                                                <C>           <C>
     DBS receiver components......................     $12,506   $13,565
     EchoStar Receiver Systems....................       7,649    17,917
     Consigned DBS receiver components............       3,122     4,073
     Finished goods - analog DTH equipment........       2,116     1,614
     Spare parts and other........................       1,440     1,281
     Reserve for excess and obsolete inventory....      (3,840)   (3,807)
                                                   ------------------------
                                                       $22,993   $34,643
                                                   ------------------------
                                                   ------------------------
</TABLE>

4.   COMMITMENTS AND CONTINGENCIES

     During February 1997, EchoStar and The News Corporation Limited ("News") 
announced an agreement (the "News Agreement") pursuant to which, among other 
things, News agreed to acquire approximately 50% of the outstanding capital 
stock of EchoStar.  News also agreed to make available for use by EchoStar 
the DBS permit for 28 frequencies at 110DEG.  West Longitude purchased by MCI 
Communications Corporation for over $682 million following a 1996 FCC 
auction. During late April 1997, substantial disagreements arose between the 
parties regarding their obligations under the News Agreement.

     In May 1997, EchoStar filed a Complaint requesting that the Court 
confirm EchoStar's position and declare that News is obligated pursuant to 
the News Agreement to lend $200 million to EchoStar without interest and upon 
such other terms as the Court orders.  EchoStar also filed a First Amended 
Complaint significantly expanding the scope of the litigation, to include 
breach of contract, failure to act in good faith, and other causes of action. 
EchoStar seeks specific performance of the News Agreement and damages, 
including lost profits based on, among other things, a jointly prepared 
ten-year business plan showing expected profits for EchoStar in excess of $10 
billion based on consummation of the transactions contemplated by the News 
Agreement.

     In June 1997, News filed an answer and counterclaims seeking unspecified 
damages.  News' answer denies all of the material allegations in the First 
Amended Complaint and asserts numerous defenses, including bad faith, 
misconduct and failure to disclose material information on the part of 
EchoStar and its Chairman and Chief Executive Officer, Charles W. Ergen.  The 
counterclaims, in which News is joined by its subsidiary American Sky 
Broadcasting, L.L.C., assert that EchoStar and Ergen breached their 
agreements with News and failed to act and negotiate with News in good faith. 
EchoStar has responded to News' answer and denied the allegations in their 
counterclaims.  EchoStar also has asserted various affirmative defenses.  
EchoStar intends to vigorously defend against the counterclaims.  Discovery 
commenced on July 3, 1997 and depositions are currently being taken.  The 
case has been set for trial commencing November 1998, but that date could be 
postponed.

     While EchoStar is confident of its position and believes it will 
ultimately prevail, the litigation process could continue for many years and 
there can be no assurance concerning the outcome of the litigation.      

                                       6
<PAGE>

                                   ECHO SATELLITE
  (A COMBINATION OF CERTAIN WHOLLY-OWNED SUBSIDIARIES OF ECHOSTAR COMMUNICATIONS
                         CORPORATION, AS DEFINED IN NOTE 1)
   NOTES TO CONDENSED COMBINED AND CONSOLIDATED FINANCIAL STATEMENTS--CONTINUED
                                    (Unaudited)

     EchoStar is subject to various other legal proceedings and claims which 
arise in the ordinary course of its business.  In the opinion of management, 
the amount of ultimate liability with respect to those actions will not 
materially affect the financial position or results of operations of EchoStar.

     In November 1998 and 1999, certain meteoroid events will occur as the 
earth's orbit passes through the particulate trail of Comet 55P 
(Tempel-Tuttle). These meteoroid events pose a potential threat to all 
in-orbit geosynchronous satellites, including EchoStar's DBS satellites.  
EchoStar is presently evaluating the potential effects that these meteoroid 
events may have on its DBS satellites.  At this time, it is not possible to 
determine what impact, if any, these meteoroid events could have on 
EchoStar's DBS satellites.

                                       7
<PAGE>

ITEM 2.   MANAGEMENT'S NARRATIVE ANALYSIS OF RESULTS OF OPERATIONS

     ALL STATEMENTS CONTAINED HEREIN, AS WELL AS STATEMENTS MADE IN PRESS 
RELEASES AND ORAL STATEMENTS THAT MAY BE MADE BY THE COMPANY OR BY OFFICERS, 
DIRECTORS OR EMPLOYEES OF THE COMPANY ACTING ON ITS BEHALF, THAT ARE NOT 
STATEMENTS OF HISTORICAL FACT CONSTITUTE "FORWARD-LOOKING STATEMENTS" WITHIN 
THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.  SUCH 
FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND 
OTHER FACTORS THAT COULD CAUSE THE ACTUAL RESULTS OF THE COMPANY TO BE 
MATERIALLY DIFFERENT FROM HISTORICAL RESULTS OR FROM ANY FUTURE RESULTS 
EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS.  AMONG THE FACTORS 
THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY ARE THE FOLLOWING: THE 
UNAVAILABILITY OF SUFFICIENT CAPITAL ON SATISFACTORY TERMS TO FINANCE THE 
COMPANY'S BUSINESS PLAN; INCREASED COMPETITION FROM CABLE, DIRECT BROADCAST 
SATELLITE ("DBS"), OTHER SATELLITE SYSTEM OPERATORS AND OTHER PROVIDERS OF 
SUBSCRIPTION TELEVISION SERVICES; THE INTRODUCTION OF NEW TECHNOLOGIES AND 
COMPETITORS INTO THE SUBSCRIPTION TELEVISION BUSINESS; INCREASED SUBSCRIBER 
ACQUISITION COSTS AND SUBSCRIBER PROMOTION SUBSIDIES; THE INABILITY OF THE 
COMPANY TO OBTAIN NECESSARY SHAREHOLDER AND BONDHOLDER APPROVAL OF ANY 
STRATEGIC TRANSACTIONS; THE INABILITY OF THE COMPANY TO OBTAIN AND RETAIN 
NECESSARY AUTHORIZATIONS FROM THE FEDERAL COMMUNICATION COMMISSION ("FCC"); 
THE OUTCOME OF ANY LITIGATION IN WHICH THE COMPANY MAY BE INVOLVED; GENERAL 
BUSINESS AND ECONOMIC CONDITIONS; AND OTHER RISK FACTORS DESCRIBED FROM TIME 
TO TIME IN THE COMPANY'S REPORTS FILED WITH THE SECURITIES AND EXCHANGE 
COMMISSION ("SEC").  IN ADDITION TO STATEMENTS THAT EXPLICITLY DESCRIBE SUCH 
RISKS AND UNCERTAINTIES, READERS ARE URGED TO CONSIDER STATEMENTS THAT 
INCLUDE THE TERMS "BELIEVES," "BELIEF," "EXPECTS," "PLANS," "ANTICIPATES," 
"INTENDS" OR THE LIKE TO BE UNCERTAIN AND FORWARD-LOOKING.  ALL CAUTIONARY 
STATEMENTS MADE HEREIN SHOULD BE READ AS BEING APPLICABLE TO ALL 
FORWARD-LOOKING STATEMENTS WHEREVER THEY APPEAR. IN THIS CONNECTION, 
INVESTORS SHOULD CONSIDER THE RISKS DESCRIBED HEREIN.

THREE MONTHS ENDED MARCH 31, 1998 COMPARED TO THE THREE MONTHS ENDED MARCH 
31, 1997.

     REVENUE.  Total revenue for the three months ended March 31, 1998 was 
$214 million, an increase of $145 million or 210%, as compared to total 
revenue for the three months ended March 31, 1997 of $69 million.  The 
increase in total revenue was primarily attributable to DISH Network 
subscriber growth combined with increased revenue from the Company's 
Technology business unit.  The number of DISH Network subscribers increased 
from 1,040,000 at December 31, 1997 to 1.2 million subscribers at March 31, 
1998.  Comparatively, the number of DISH Network subscribers increased from 
350,000 at December 31, 1996 to 479,600 at March 31, 1997.  The Company 
expects that its revenues will continue to increase as the number of DISH 
Network subscribers increases.  Consistent with the increases in total 
revenue and the number of DISH Network subscribers during the three months 
ended March 31, 1998, the Company experienced a corresponding increase in 
trade accounts receivable at March 31, 1998.  During the three months ended 
March 31, 1998 and 1997, the Company's subscriber churn (which represents the 
number of subscriber disconnects during the period divided by the 
weighted-average number of subscribers during the period) approximated 1% per 
month.

     DISH Network subscription television services revenue totaled $129 
million for the three months ended March 31, 1998, an increase of $81 million 
compared to the same period in 1997.  This increase was directly attributable 
to the increase in the number of DISH Network subscribers.  Monthly revenue 
per subscriber approximated $38 during each of the three-month periods ended 
March 31, 1998 and 1997.  DISH Network subscription television services 
revenue principally consists of revenue from basic, premium and pay-per-view 
subscription television services.  DISH Network subscription television 
services revenue will continue to increase as the Company adds DISH Network 
subscribers.

     For the three months ended March 31, 1998, DTH equipment sales and 
integration services totaled $67 million, an increase of $65 million compared 
to the three months ended March 31, 1997.  DTH equipment sales consist of 
sales of digital set-top boxes and other digital satellite broadcasting 
equipment by the Company to international DTH service operators.  EchoStar 
currently has agreements to provide equipment to DTH service operators in 
Spain and Canada. Sales pursuant to these agreements totaled $59 million for 
the three months ended March 31, 1998.  DBS accessory and other sales totaled 
$8 million during the three months ended March 31, 1998, a $6 million 
increase compared to the same period in 1997.

     While EchoStar continues to actively pursue other distribution and
integration service opportunities, no assurance can be given that any such
additional negotiations will be successful.  EchoStar's future revenue from the

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<PAGE>

ITEM 2.   MANAGEMENT'S NARRATIVE ANALYSIS OF RESULTS OF OPERATIONS--CONTINUED

sale of DTH equipment and integration services in international markets 
depends largely on the success of the DTH operator in that country, which, in 
turn, depends on other factors, such as the level of consumer acceptance of 
DBS products and the intensity of competition for international subscription 
television subscribers.  No assurance can be given regarding the level of 
expected future revenues that may be generated from EchoStar's alliances with 
foreign DTH operators.

     Satellite services revenue totaled $5 million for the three months ended 
March 31, 1998, an increase of $3 million as compared to the same period in 
1997.  These revenues include, among other things, fees charged to content 
providers for signal carriage and revenues earned from business television 
(BTV) customers for the broadcast of organizationally specific programming.  
The increase in satellite services revenue was primarily attributable to 
increased usage by the Company's BTV customers.

     DISH NETWORK OPERATING EXPENSES.  DISH Network operating expenses 
totaled $81 million for the three months ended March 31, 1998, an increase of 
$49 million as compared to the same period in 1997.  The increase in DISH 
Network operating expenses was primarily attributable to the increase in the 
number of DISH Network subscribers.  For the three months ended March 31, 
1998, DISH Network operating expenses represented 63% of subscription 
television services revenue compared to 67% of subscription television 
revenue during the corresponding period in 1997.

     Subscriber-related expenses totaled $64 million for the three months 
ended March 31, 1998, an increase of $41 million compared to the same period 
in 1997. Such expenses, which include programming expenses, copyright 
royalties, residuals payable to retailers and distributors, and billing, 
lockbox and other variable subscriber expenses, totaled 50% of subscription 
television services revenues for the three months ended March 31, 1998, 
compared to 48% of subscription television services revenues for the three 
months ended March 31, 1997.  The increase in subscriber-related expenses as 
a percentage of subscription television services revenue resulted primarily 
from an increase in copyright royalties payable by satellite providers for 
the transmission of distant broadcast network and superstation signals.  This 
increase in copyright royalties accounted for approximately $3 million of the 
increase in subscriber-related expenses.

     Customer service center and other expenses principally consist of costs 
incurred in the operation of the Company's DISH Network customer service 
center, such as personnel and telephone expenses, as well as subscriber 
equipment installation and other operating expenses.  Customer service center 
and other expenses totaled $12 million for the three months ended March 31, 
1998, an increase of $6 million as compared to the three months ended March 
31, 1997. Customer service center and other expenses totaled 9% of 
subscription television services revenue during the three months ended March 
31, 1998, compared to 13% of subscription television services revenue during 
the same period of the prior year.  The increase in customer service center 
and other expenses resulted from increased personnel expenses to support the 
growth of the DISH Network.  While there can be no assurance that customer 
service center and other expenses as a percentage of subscription television 
services revenue will not increase, the Company expects this expense to 
revenue ratio to remain near first quarter levels for the remainder of 1998.

     Satellite and transmission expenses include expenses associated with the 
operation of EchoStar's digital broadcast center, contracted satellite 
tracking, telemetry and control ("TT&C") services, and in-orbit insurance on 
EchoStar's DBS satellites.  Satellite and transmission expenses increased $2 
million during the three months ended March 31, 1998, as compared to the same 
period during 1997.  This increase resulted from an increase in the number of 
EchoStar's operational DBS satellites.  The Company expects DISH Network 
operating expenses to continue to increase in the future as subscribers are 
added.  However, as its DISH Network subscriber base continues to expand, the 
Company expects that such costs as a percentage of DISH Network revenue may 
decline.

     COST OF SALES - DTH EQUIPMENT AND INTEGRATION SERVICES.  Cost of sales 
- DTH equipment and integration services totaled $47 million for the three 
months ended March 31, 1998, an increase of $45 million, as compared to the 
three months ended March 31, 1997.  This increase is consistent with the 
increase in DTH equipment revenue.  During the three months ended March 31, 
1998, cost of sales - DTH equipment and integration services principally 
included costs associated with digital set-top boxes and related components 
sold to international DTH operators.  For

                                       9

<PAGE>

ITEM 2.   MANAGEMENT'S NARRATIVE ANALYSIS OF RESULTS OF OPERATIONS--CONTINUED

the three months ended March 31, 1997, cost of sales - DTH equipment and 
integration services totaled $2 million and consisted almost entirely of 
costs of DBS accessories sold.

     MARKETING EXPENSES.  Marketing expenses totaled $53 million for the 
three months ended March 31, 1998, an increase of $37 million as compared to 
the same period in 1997.  The increase in marketing expenses was primarily 
attributable to the increase in subscriber promotion subsidies.  Subscriber 
promotion subsidies include the excess of transaction costs over transaction 
proceeds at the time of sale of EchoStar Receiver Systems, activation 
allowances paid to retailers, and other promotional incentives.  The Company 
recognizes subscriber promotion subsidies as incurred.  These expenses 
totaled $45 million for the three months ended March 31, 1998, an increase of 
$32 million over the same period in 1997.  This increase principally resulted 
from the immediate recognition of all subscriber promotion subsidies incurred 
in 1998, whereas during the three-month period ended March 31, 1997, a 
portion of such expenses were initially deferred and amortized over the 
related prepaid subscription term (generally one year).  This accelerated 
expense recognition resulted from the introduction of the "1997 Promotion" in 
June 1997.  The 1997 Promotion maintained the suggested retail price for a 
standard EchoStar Receiver System at $199, but eliminated the requirement for 
the coincident purchase of an extended subscription commitment.  For the 
three months ended March 31, 1998, the Company's subscriber acquisition 
costs, inclusive of acquisition marketing expenses, totaled $51 million 
(approximately $250 per new subscriber activation).  Comparatively, the 
Company's subscriber acquisition costs, inclusive of acquisition marketing 
expenses and deferred subscriber acquisition costs, totaled $58 million (in 
excess of $400 per new subscriber activation) during the same period in 1997. 
The decrease in the Company's subscriber acquisition costs, on a per new 
subscriber activation basis, principally resulted from decreases in the 
manufactured cost of EchoStar Receiver Systems. Advertising and other 
expenses totaled $8 million for the three months ended March 31, 1998, an 
increase of $5 million over the same period in 1997, as a result of increased 
marketing activity.

     GENERAL AND ADMINISTRATIVE EXPENSES.  General and administrative ("G&A") 
expenses totaled $19 million for the three-month period ended March 31, 1998, 
an increase of $4 million as compared to the same period in 1997.  The 
increase in G&A expenses was principally attributable to increased personnel 
expenses to support the growth of the DISH Network.  G&A expenses as a 
percentage of total revenue decreased to 9% for the three months ended March 
31, 1998 compared to 22% for the corresponding period in 1997.  While there 
can be no assurance that G&A expenses as a percentage of total revenue will 
not increase, the Company expects this expense to revenue ratio to remain 
near first quarter levels for the remainder of 1998.

     EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION 
("EBITDA"). EBITDA for the three months ended March 31, 1998 improved to $8 
million compared to negative EBITDA of $3 million for the same period in 
1997.  This improvement in EBITDA principally resulted from increases in DISH 
Network and Technology revenues.  The Company believes that its EBITDA 
results may continue to improve in future periods as the number of DISH 
Network subscribers increases.  However, in the event that new subscriber 
activations exceed expectations or subscriber acquisition costs materially 
increase, the Company's EBITDA results may be negatively impacted in the 
near-term because subscriber acquisition costs are expensed as incurred.

     DEPRECIATION AND AMORTIZATION.  Depreciation and amortization expenses 
for the three months ended March 31, 1998 (including amortization of 
subscriber acquisition costs of $11 million) aggregated $26 million, a 
decrease of $15 million as compared to the corresponding period in 1997.  The 
decrease in depreciation and amortization expenses principally resulted from 
the decrease in amortization of subscriber acquisition costs, partially 
offset by an increase in depreciation related to the addition of EchoStar 
III.  Beginning in October 1997, net subscriber acquisition costs are 
expensed as incurred.  Consequently, no additional subscriber acquisition 
costs are being deferred.  The unamortized balance of such costs is expected 
to be fully amortized by September 1998.

     OTHER INCOME AND EXPENSE.  Other expense, net totaled $29 million for 
the three months ended March 31, 1998, an increase of $9 million as compared 
to the same period in 1997.  The increase in other expense resulted primarily 
from increases in interest expense associated with increased accreted 
balances on the Company's 12 7/8% Senior Secured Discount Notes due 2004 and 
the Company's 13 1/8% Senior Secured Discount Notes due 2004, combined with a 
decrease in the amount of interest capitalized during the three months ended 
March 31, 1998.

                                       10
<PAGE>

                          PART II - OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS


     During February 1997, EchoStar and The News Corporation Limited ("News") 
announced an agreement (the "News Agreement") pursuant to which, among other 
things, News agreed to acquire approximately 50% of the outstanding capital 
stock of EchoStar.  News also agreed to make available for use by EchoStar 
the DBS permit for 28 frequencies at 110DEG.  West Longitude purchased by MCI 
Communications Corporation for over $682 million following a 1996 FCC 
auction. During late April 1997, substantial disagreements arose between the 
parties regarding their obligations under the News Agreement.

     In May 1997, EchoStar filed a Complaint requesting that the Court 
confirm EchoStar's position and declare that News is obligated pursuant to 
the News Agreement to lend $200 million to EchoStar without interest and upon 
such other terms as the Court orders.  EchoStar also filed a First Amended 
Complaint significantly expanding the scope of the litigation, to include 
breach of contract, failure to act in good faith, and other causes of action. 
EchoStar seeks specific performance of the News Agreement and damages, 
including lost profits based on, among other things, a jointly prepared 
ten-year business plan showing expected profits for EchoStar in excess of $10 
billion based on consummation of the transactions contemplated by the News 
Agreement.

     In June 1997, News filed an answer and counterclaims seeking unspecified 
damages.  News' answer denies all of the material allegations in the First 
Amended Complaint and asserts numerous defenses, including bad faith, 
misconduct and failure to disclose material information on the part of 
EchoStar and its Chairman and Chief Executive Officer, Charles W. Ergen.  The 
counterclaims, in which News is joined by its subsidiary American Sky 
Broadcasting, L.L.C., assert that EchoStar and Ergen breached their 
agreements with News and failed to act and negotiate with News in good faith. 
EchoStar has responded to News' answer and denied the allegations in their 
counterclaims.  EchoStar also has asserted various affirmative defenses.  
EchoStar intends to vigorously defend against the counterclaims.  Discovery 
commenced on July 3, 1997 and depositions are currently being taken.  The 
case has been set for trial commencing November 1998, but that date could be 
postponed.

     While EchoStar is confident of its position and believes it will 
ultimately prevail, the litigation process could continue for many years and 
there can be no assurance concerning the outcome of the litigation.

     EchoStar is subject to various other legal proceedings and claims which 
arise in the ordinary course of its business.  In the opinion of management, 
the amount of ultimate liability with respect to those actions will not 
materially affect the financial position or results of operations of EchoStar.


                                       11