DirecTV would launch its planned VOD service. He just stated that the introduction would take place in "the not-too-distant future."
The VOD plans are part of DirecTV's concerted drive to ease its rising monthly churn rates by offering a group of new high-end products, including high-definition TV (HDTV) set-top boxes and home media centers. Besides producing greater revenue for DirecTV, Palkovic noted that customers who take a greater number of advanced services show much less inclination to drop their satellite TV subscriptions.
DirecTV is following in the footsteps of its satellite rival, EchoStar Communications, which has already launched a basic VOD service to select DISH Network subscribers. Called DISH On Demand, the service is available on the DISH Player-DVR 625 set-top box. Initially, the DISH offering is a movies-on-demand service, enabling subscribers to access hit films stored on the set-top hard drive. The cost is $4.99 per movie for 24 hours of access with pause, rewind and fast forward capabilities.
The competitive gambits by DirecTV and EchoStar come at a critical time in the continuing cable-satellite marketing wars. With DVRs now installed in at least 8% of U.S. homes, both industries are heavily promoting DVR-enabled set-tops to lure affluent, high-spending consumers. Time Warner Cable, for instance, has already signed up 22% of its 5 million digital cable subscribers, or more than 1 million customers, for its DVR service.
The DirecTV move also comes as cable operators, after some initial bumps in the road, report that VOD is proving to be an increasingly popular and sticky product for them. With on-demand programming available to some 56 million cable homes, industry analysts estimate that about 24 million cable subscribers now pay the monthly fee for digital cable packages with VOD services.
The VOD plans are part of DirecTV's concerted drive to ease its rising monthly churn rates by offering a group of new high-end products, including high-definition TV (HDTV) set-top boxes and home media centers. Besides producing greater revenue for DirecTV, Palkovic noted that customers who take a greater number of advanced services show much less inclination to drop their satellite TV subscriptions.
DirecTV is following in the footsteps of its satellite rival, EchoStar Communications, which has already launched a basic VOD service to select DISH Network subscribers. Called DISH On Demand, the service is available on the DISH Player-DVR 625 set-top box. Initially, the DISH offering is a movies-on-demand service, enabling subscribers to access hit films stored on the set-top hard drive. The cost is $4.99 per movie for 24 hours of access with pause, rewind and fast forward capabilities.
The competitive gambits by DirecTV and EchoStar come at a critical time in the continuing cable-satellite marketing wars. With DVRs now installed in at least 8% of U.S. homes, both industries are heavily promoting DVR-enabled set-tops to lure affluent, high-spending consumers. Time Warner Cable, for instance, has already signed up 22% of its 5 million digital cable subscribers, or more than 1 million customers, for its DVR service.
The DirecTV move also comes as cable operators, after some initial bumps in the road, report that VOD is proving to be an increasingly popular and sticky product for them. With on-demand programming available to some 56 million cable homes, industry analysts estimate that about 24 million cable subscribers now pay the monthly fee for digital cable packages with VOD services.
