EchoStar (NASDAQ:DISH) is in a bit of a tough spot right now. The satellite-TV provider has some pretty hefty competition as a pure-play TV provider, with the cable companies pushing the famed "triple play" package of phone, TV, and high-speed internet all on one bill. The company generates copious free cash flow, to the tune of $947 million over the last year. But with roughly 20% of subscribers being churned each year, it's difficult to maintain a wide-moat competitive advantage, even if EchoStar is the low-cost provider.

Still, the quarter's numbers were quite positive. The subscriber base continued to grow to12.4 million, up 9% year over year. The net growth in subscribers was 195,000, down 13% sequentially due to higher churn of 1.7%. This was most likely caused by a $3-per-month price hike in some of the popular packages. Consequently, we have solid growth in revenues, up 17% to $2.4 billion, and EBITDA, up 10% to $613 million.

Bulls for the company argue that cable companies' all-in-one packages are similar to the financial supermarkets of yesterday, when financial-services companies were sucked into the argument that they had to offer everything -- banking, insurance, brokerages, and credit cards -- to capture the financial version of a "quadruple play." But that model was largely a bust, since consumers have tended to shop the best value for each offering rather than stick with one provider. Will cable suffer the same fate? I have my doubts.

For one thing, Comcast (NASDAQ:CMCSA) noted in its recent 10-Q that 49% of TV subscribers subscribed to at least one digital service, which boosted their monthly revenue per subscriber about 8% to $57.49 year over year. To make things more difficult, Time Warner (NYSE:TWX), Comcast, and Sprint (NYSE:S) are currently bidding for wireless spectrum to add 3G wireless services, making their offerings a quadruple play.

Since DirectTV (NYSE:DTV) and EchoStar have teamed up to bid for the spectrum as well, this lends some credence to the quadruple play theory. So far, the team is one of the early aggressive bidders, but the companies have one major disadvantage: They'll have to invest heavily to build the wireless infrastructure needed to support the expected wireless-Internet and cell-phone services. The major cable providers, by virtue of the Sprint partnership, can piggyback on existing infrastructure.

The U.S wireless auction for the spectrum is expected to raise as much as $15 billion, reminding this Fool of the disastrous European wireless auctions in 2000, where billions were spent -- and telecom companies nearly bankrupted, when the bills came due. Let's hope saner heads prevail this time around, despite the obvious competitive pressures.

Given cable companies' very real threat to satellite subscriber growth, and the poor competitive positioning for the satellite companies when it comes to expanding from a single play to a double play for wireless broadband, investors should take note. The market has flatlined the stock for several years for good reason. Until the satellite companies can expand their offerings successfully, it may be best be a Dish subscriber, not an investor.

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Fool contributor Stephen Ellis is a Dish subscriber but doesn't hold shares in any companies mentioned. You can see his holdings for yourself. The Motley Fool has an all-digital disclosure policy.