DirecTV mum on rate increases

Wednesday, January 07, 2009

No word from DirecTV CEO Chase Carey on DirecTV rate increases for 2009 during his presentation at a Citigroup analyst conference in Phoenix today. “We have not announced our position,” he said.

Speaking the day before CES opens, Carey reiterated DirecTV’s strength with the video experience, rattling off advancements like with home networking throughout the house, and DVR scheduling from remote locations.

 “We continue to believe a great TV experience should be the cornerstone, and consumers will find ways to satisfy demand for the array of services like phone and broadband,” Carey said.

On the competitive front “players like AT&T and Verizon become more important partners,” he said, even as they roll out FiOS and U-verse.

“In a FiOS region, they are a competitor,” he allowed, but the next expansion for FiOS will occur in urban areas where DirecTV is less penetrated. On Feb. 1, AT&T will start selling DirecTV, pushing that product over DISH in non U-verse areas. “It gives us a new dimension to push forward with.” That will give DirecTV an effective national telco footprint, since it also is aligned with Verizon and Qwest.

“We are an ally of the phone guys,” he said.

So even as overall DBS gross additions are falling, DirecTV’s gross adds can remain strong, he said, with both a better product and the phone alliances.

Carey said DirecTV HD penetration is bumping up to 30%, but that will more than double in three to five years. “DVR likewise,” he said.

Despite the economy, “we have a lot of room to grow advance products” to boost ARPU growth, he said. “We feel pretty good about 4% to 5% ARPU growth,” he said.

Carey said DirecTV is looking at targeting 8 to 10 million of the 25 million units in MDUs across the country.

Historically, DirecTV’s penetration in MDUs has been “woeful,”  he said. Some of it was technical. “We didn’t have a solution that worked for that type of dwelling…a single dish on roof,” he said.

“We now have a very cost effective solution,” he said. “The second leg is to put in an organization,” he said, which occurred this year. The next step is to establish business practices and financial targets. Launching a service but getting only 10% penetration won’t work, he said.

“This is a multiyear project,” he said. “We expect to make headway in 2009, and grow significantly over the next few years.”

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