HSN, Inc., an interactive multi-channel retailer, provides retail experiences through various platforms, including television, online, mobile, catalogs, and retail and outlet stores. It markets and sells a range of third party and private label merchandise primarily in the United States. Segments The company operates in two segments, HSN and Cornerstone. HSN HSN includes the HSN television networks; its related Website, HSN.com; its mobile applications and a limited number of outlet stores. The HSN television network broadcasts live, customer interactive home shopping programming 24 hours a day, 7 days a week. HSN2 is a network that primarily distributes taped programming on a limited distribution basis. Programming is divided into separately televised segments, most of which has a host who presents and conveys information regarding featured products, sometimes with the assistance of a representative from the product vendor or someone that it retains to aid in the sale of the products. HSN also produces entertainment, such as live concerts to entertain and engage with customers, as well as promotes certain products. HSN.com is a business-to-consumer digital commerce site that sells all of the merchandise offered on the HSN television networks, together with complementary products and select merchandise sold exclusively on HSN.com. As of December 31, 2012, the HSN television networks reached approximately 95.0 million homes. Television households reached by the HSN television networks, as of December 31, 2012, primarily include approximately 64.0 million households capable of receiving cable and/or broadcast transmissions, respectively, and approximately 31.0 million direct broadcast satellite system, or DBS, households. Pay Television Distribution: HSN has entered into multi-year distribution and affiliation agreements with cable television and DBS operators, collectively referred to as pay television operators, in the United States to carry the HSN television networks, as well as to promote the networks by carrying related commercials and distributing related marketing materials to their respective subscriber bases. HSN has contracts with local and national pay television operators to distribute HSN television programming. HSN’s larger pay television operators include Comcast, DirecTV, Echostar/DISH and Time Warner. Broadcast Television Distribution: As of December 31, 2012, HSN also had affiliation agreements with 25 low power broadcast television stations for leased carriage of the HSN television network with terms ranging from several weeks to several years. In exchange for this carriage, HSN pays the broadcast television stations hourly or monthly fixed rates. HSNi’s subsidiary, Ventana Television, Inc. also owns 26 low power broadcast television stations that carry the HSN network on a full-time basis. HSN.com: HSN also includes HSN.com, a transactional Internet site that sells merchandise offered on the HSN television networks, as well as select merchandise sold exclusively on HSN.com. HSN.com provides customers with additional content to support and enhance HSN television programming. For example, HSN.com provides users with an online program guide, value-added video of product demonstrations, live streaming video of the HSN television network, customer-generated product reviews and additional information about HSN show hosts and guest personalities. HSN.com features approximately 60,000 product videos. Digital Distribution: HSN has applications for the iPhone, iPad, Android phones and tablets and Windows 7 phones. These applications are highly video-centric, customized experiences that allow users to order merchandise, stream live video from HSN and watch previously-aired content from the network’s video library while simultaneously browsing related products. CORNERSTONE Cornerstone consists of a portfolio of aspirational home and apparel brands, used in the direct marketing and retail space, including catalog distribution and related Websites. Its home brands comprise Frontgate, Ballard Designs, Grandin Road and Improvements. There are also 11 retail and outlet stores locat