But wait, there is more! You are forgetting the huge warehouses full of receivers, dishes and support hardware for the satellite side which Directv has to pay for plus fleets of installers, other types of employees, vehicles, etc. That all goes away with a pure streaming business model. That's what is causing ATT to go the streaming direction and I've been told by DTV management that a Netflix type business model is a goal. Customers call up, you authorize them and take their money. No truck rolls, no hardware, no problems.
DirecTV Q1 2019 Results - 627,000 Net Loss Subs (DirecTV & Directv Now)
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Not to mention you really can't outsource a satellite engineer...it much easier to send IT work to india
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ATT has laid off just about everyone I know in the Directv RF and satellite engineering groups. If it weren't for some outstanding Latin American projects I fear they would all be gone. And no, you can't outsource that, some really talented engineers are gone and they would be difficult to replace without many years of on the job experience.
One thing I just thought of.
When I first started in this business 22 years ago the key service was Tv and people then wanted a home phone.
You do a new satellite install and the big deal was hooking receivers to phone lines which EVERY customer had at the time.
People had cell phones, but they where primarily kept in the car and used in emergencies as most of the plans where per minute.
As cell phones became more popular, the first thing that went away was the home phone.
Not everyone wanted internet at this point, but with traditional pots lines costing upwards of $70/mo the cost savings getting rid of the home telephone went to pay for higher cell phone bills and the ever increasing Tv service cost.
As more and more people got internet, the typical household subscribed to atleast 1 streaming service such as Netflix.
But the reason why video is becoming unpopular is because in most households the cell phone bill comes first, followed by internet service, then Tv, and then a home phone.
Even though cell phone rates are generally going down, the cost of the phones go up and if you have the latest iPhone, your paying $50 per month just in the finance charges.
The cell phone bill is what’s replacing the traditional Tv bill
When I first started in this business 22 years ago the key service was Tv and people then wanted a home phone.
You do a new satellite install and the big deal was hooking receivers to phone lines which EVERY customer had at the time.
People had cell phones, but they where primarily kept in the car and used in emergencies as most of the plans where per minute.
As cell phones became more popular, the first thing that went away was the home phone.
Not everyone wanted internet at this point, but with traditional pots lines costing upwards of $70/mo the cost savings getting rid of the home telephone went to pay for higher cell phone bills and the ever increasing Tv service cost.
As more and more people got internet, the typical household subscribed to atleast 1 streaming service such as Netflix.
But the reason why video is becoming unpopular is because in most households the cell phone bill comes first, followed by internet service, then Tv, and then a home phone.
Even though cell phone rates are generally going down, the cost of the phones go up and if you have the latest iPhone, your paying $50 per month just in the finance charges.
The cell phone bill is what’s replacing the traditional Tv bill
FWIW, they are supplying clients for the upcoming 'Directv via IP' service, at least according to the CEO's statements and the manual that comes with that client.
But yeah the fleet of installers and their vehicles costs a lot - but that's mostly an up front cost since unless your LNB craps out or something they don't need to visit already installed customers. The modern setup of HS17 + clients means the only difference between satellite and the new IP service will be the home visit to install the dish and the HS17/clients, versus just shipping you clients. They charge $15/month for 'advanced receiver fee' for that HS17 which goes a long way toward paying for that, since $15/month times the 60 month depreciable lifetime of the HS17 is $900 which means they can expect to make a 'profit' of at least $700 on the that fee which they won't collect for the IP version.
There are a lot of costs that go away with satellite customers, but also some pretty juicy revenue as well, so it isn't as cut and dried as "look at all these expenses that go away" since you have to take into account the revenue that goes away also in determining how it impacts Directv's profitability which in the end is all the CEO cares about.
As streaming prices increase, to cover costs and make a profit, I can see a comeback for satcos.
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What if eventually DTV wont even need their own box to do the full DTV over IP they would just have the APP where they could configure it with or without channel numbers?
Not unless someone wants to pony up money to buy new satellites
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They don’t have to worry about that until a couple decades from now when DirecTV 14 (2014 launch), DirecTV 15 (2015 launch), and DirecTV 16 (launching this year) start to approach the end of their service life.
That brings up the question don't cable and streaming services get their channel signal by satellite? If so they have to keep building them.
Of course in that scenario, everything electronic would go down. As well as the power grid. So I guess DTV would not be alone in having an outage. We know a huge solar flare is coming it's just a matter of how do we prepare for it.
I doubt it. I know where I'm at the power consumption has dramatically decreased as more efficient encoding systems have been installed to replace older and much more power hungry systems. Even the monitoring that was once used is gone for a much more efficient way of monitoring. Over the past few years, there has been a huge incentive to decrease power consumption and now there are times where you have to worry about too little draw happening causing issues. What used to take up the entire facility, now takes up 1/4 of the facility if not 1/8th of what it was 5 years ago.
That's including the power draw that the amps take. It's getting to the point where you will have no compression gear in any of these facilities and all you will have is the modulators, BUC's and AMP's (RF gear).
No. It's mostly over ISP pops that all of the major program providers have. It's a direct fiber connection, for instance, there is a pop in LA for Disney and ABC, one in The Woodlands, TX for Fox, ect. ATT gets its programming from a fiber connection between these network distribution points and offloads it onto their network. The stuff you see on Cband is primarily used as a backup.
I saw some pictures from inside one of Directv's broadcast centers like five years ago and they had a monitor for every single channel. Are they doing something different now, maybe have 4x4 for 16 channels per LCD monitor or have they replaced that 'human eyes' monitoring entirely with technology?
Satellite will be around a good 10-15 years unless the subscriber base drops too low to support uplink costs
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