Could Dish Network Be the New Netflix?

Purchasing a bankrupt Blockbuster for $320 million in April and spending nearly $3 billion on broadband spectrum are all part of Dish Network’s (NASDAQ:DISH) plan to turn the pay-television service into a competitor of both streaming-video services like Netflix (NASDAQ:NFLX) and wireless carriers like AT&T (NYSE:T) and Verizon (NYSE:VZ). Dish Network has around 14 million subscribers to its satellite TV service, about half of the number of subscribers to Netflix, and well short of the number of subscribers to rival pay-TV service Comcast (NASDAQ:CMCSA).

Hot Feature: The Future of Streaming Video.

Dish Network recently hired former Sirius (NASDAQ:SIRI) chairman Joe Clayton, who helped develop satellite broadcaster DirectTV (NASDAQ:DTV), to act as president and chief executive, managing day-to-day operations while Dish co-founder Charlie Ergen focuses on the big picture: turning the company into a multimedia giant. With online and mobile services providing various alternatives to cable and satellite, Dish hopes to remain relevant by expanding its offerings to include broadband, wireless services, video-streaming services and more.

Dish will keep 1,500 of 1,700 Blockbuster outlets open, despite an obvious trend away from DVD rentals. Clayton says the stores will be used not only as sales and rental outlets, but to promote Dish Network as well as the company’s new Blockbuster streaming-video service and its new wireless service. Clayton may even borrow a page from the RadioShack (NYSE:RSH) playbook and sell consumer electronics at the chains.

While many have criticized Dish (NASDAQ:DISH) network’s spending spree, including its purchase of the failing Blockbuster chain, investors seem optimistic about its prospects. The stock has climbed over 60% in the last year, and 45% since it purchased Blockbuster in April. But the company has yet to make any real advances toward its rather ambitious goals, and meanwhile its two main businesses — DVD rental and pay-TV — continue to lose customers.