Target HD-DVR cost by end of year under $200 (COST - Not Retail) vs. over $400 last year.
SAC (acquisition costs) driven up by going after customers we want vs. those we don't (credit)
Economy (subprime market issues) not expected to impact our operations / results.
FIOS Competition?FIOS competitio 6 millions homes approx, compete as a cable company, seeing a small impact in some markets.
We're competing in each market, not a one-size fit all strategy.
NFL Sunday Tickey exclusive - expires 2010 - what are plans to keep / change?
It's early, 2011 fall is when we're talking, great property for us at a big price.
We've done great job and NFL values what we've done.
Alot of dynamics to happen before we figure out, we would like to keep it.
There could be price at which it doens't work, but we value the relationship with the NFL.
We've done great things with superfan and HD for NFL sunday ticket.
We hit our targets and had great growth - hit our goals for Sunday Ticket.
Goals of producing content?
We have a lot of room to grow and expand. Open mind when considering content and evaluting opportunities.
Our goal is to grow this business to everything it can be. Not to produce content.
Demographics of customer quality?
Consider income, homeownership, an array of things, etc.
We have a statistic model that is unique to us, so I won't put it out there.
We base value of customer to choose offerings and value of relationship.
Churn based on cost of box to customer, considered price drop?
It's a factor, don't think it is a huge one. Becomes back of mind as customer years go by.
2 year contracts on advanced products, after 2 years, upfront costs doens't reduce churn.
Plan to continue charging something up front, economic decision.
AT&T?
Both us and echostar talking to them. Up to AT&T. Expect to hear more in fall.
Already have a working relationship, so no pressure.
700mhz auction? Decision not to participate related to Libery deal?
We're not in it, nothing to do with Liberty, our view is broadband is a tough place.
Building new technology tough go, and a lot of money. Talking billions to acquire and build it out.
Goal to enter broadband business with out service, through partnerships.
Stragety on WildBlue?
No change with liberty transaction. Good relationship - but early.
Rural produt, good option for when no other option.
Niche product, can be a nice business.
Plans for D11/12?
D12 no launch plans finalized yet.
Life of fleet remaining? Replacement birds?
HD satellite over 10 years, we have a fresh fleet
HD Must carry change outlook?
Came out of blue, quickly, trying to understand all the things involved.
Premature to say.
Robust fleet with lot of flexibility, especially with Spaceways.
Need to get better understanding first.
Stock Dividend considered?
Not prepared, reviewing with board.
Digital Transition?
No magic, national reach, mostly elderly and ethnic that need to be targeted.
Our subscribers only may have issues for those 3rd/4th sets.
Advanced products / growth?
Expect good growth in 2008.
Continue to expect 10% advanced product integration 10% a year
(meaning 10% more customers have HD or DVR each year)
Over time these become mainstrem in homes, not there yet, but lots of momentum.
We're reaching mature product status - 40 to 50% of our households.
Advnaced services progress? Other things coming? Integrating broadband with video?
We've launched VOD in limited basis. HD-DVR only now.
We'll talk more in a couple weeks at investor day
(Sucks for us reading this now)
Working to get the content on broadband to be like the content on the TV.
Need to ensure we don't setup for a loss of customers to broadband only, don't want to lose customers.
Grow in an intelligent way and be a leader.
ARPU growth from price increases? How to continue pushing price increases with competition? Controlling programming costs?
Increase is at begininng of year - 3 to 4%, not in last quarter.
Offsets our other competition, it's about the same.
Price increase offset in new customer offers right now.
Competition today do it mostly in early calander year, so do we
Price competition is mostly in the offer side.
many try to hide their price increase, confusing customers, we don't do that.
We need to keep an eye on other players struggling, use it as a way to compete as they raise their prices.
We feel good about where we are today.
All comments are my best attempte to transcribe the comments and answers given on the 2/13 DirecTV earnings call.
These are not exact transcriptions, all added comments are my personal view/feedback.
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My Thoughts:
Not much there, other than very happy with their results and maintaining the cousre.
---Which is exactly what companies want their situation to be! ----
NFL Sunday ticket is a good question - but they're right, it's 3 years away, too early to speculate.
We could see another price drop on the HD-DVR as they get their to-build cost around $200.
I believe from prior calls - that cost is around $300 right now.
I would hope we see $99 or $149 for mainstream come 2009
They are up to around 40% + having HD or DVR, target 50% this year
See you again in 3 months!
