QUOTE AND NEWS
Jutia Group  Sep 18  Comment 
[at TheStreet] - More than 90 of AT&T's (T) former business partners are demanding the FCC but a stop to the company's bid to purchase DirecTV (DTV). Read more on this. DIRECTV (DTV), valued at $43.82B, opened this morning at $87.11.   Today,...
TheStreet.com  Sep 18  Comment 
NEW YORK (TheStreet) --AT&T Inc. may be facing an impediment to its $48.5 billion bid to purchase DirecTV as over 90 of the company's former business partners are asking the FCC to keep the transaction from moving forward, Reuters...
StreetInsider.com  Sep 17  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Corporate+News/DISH+Network+%28DISH%29%2C+DIRECTV+%28DTV%29+Announce+Support+of+STAVRA/9841381.html for the full story.
DailyFinance  Sep 17  Comment 
DIRECTV and DISH issued the following statement regarding the passage today of the Satellite Television Access and Viewer Rights Act (STAVRA) out of the Senate Committee on Commerce, Science, & Transportation: "We thank...
Jutia Group  Sep 17  Comment 
[PR Newswire] - LOS ANGELES, Sept. 17, 2014 /PRNewswire/ -- Guitar Center has announced that Grammy Award-winning rock band LINKIN PARK will be performing in Los Angeles, CA at The Wiltern on Friday, October 24th in celebration of the retailers...
Forbes  Sep 17  Comment 
While the pay-TV industry is saturated in the U.S., Latin America has been the driving force for DirecTV. While the company has been consistently growing its subscriber base in the region, depreciating regional currencies has stalled ARPU growth...
SeekingAlpha  Sep 16  Comment 
By Trefis: DirecTV (NASDAQ:DTV) is one of the largest pay-TV operators in Latin America with more than 12 million subscribers, and it has been growing at an average rate of 25% annually over the past few years. The pay-TV business in Latin America...
SeekingAlpha  Sep 15  Comment 
By FNF Solutions: State attorneys in the United States, who were previously scrutinizing Comcast's (NASDAQ:CMCSA) deal to buy out Time Warner Cable Inc (NYSE:TWC), have extended their investigation to cover the merger between AT&T (NYSE:T) and...
SeekingAlpha  Sep 15  Comment 
By Alex Cho: AT&T (NYSE:T) may have had one of its most frustrating years, as competition has heated up in the space, and the completion of the DirecTV (NASDAQ:DTV) deal won't happen until sometime early in 2015. The move to buy DirecTV offers...
Reuters  Sep 12  Comment 
Satellite television service DirecTV expects its merger with wireless operator AT&T Inc to be completed next April, Chief Executive Mike White told investors at a...




 
TOP CONTRIBUTORS

The DirecTV Group (NASDAQ:DTV) is the largest provider of household satellite television in the United States and has a customer base of over 18.5 million.[1] The company markets itself as the leading provider of differentiated and exclusive content, and the leader in high definition (HD) programming. DTV offers exclusive programming such as the NFL SUNDAY TICKET package and over 95 Spanish and international language channels, which are not available via cable or other satellite service providers.

Satellite television is the leading alternative to the traditional cable television and has experienced rapid growth in the past decade. However, DTV and the satellite industry continues to face challenges from traditional cable companies like Comcast (CMCSA), Cablevision Systems (CVC), and Time Warner Cable. These companies are not only much larger than their satellite competitors, but also have capacity to offer bundled services which includes TV, telephone, and high speed internet. DTV has recently begun to offer similar services through a partnership with AT&T (T) and other internet service providers, but may lose the ability to do so, as AT&T (T) continues to roll out its own video services.

Company Overview

DTV's revenue comes from the monthly subscription rates for programming that it provides to households. Depending on the number of channels and premium programming that a customer requests, the amount each household pays can be vastly different. For acquiring each customer, DTV incurs significant costs by often times giving away equipment and providing installation. The company sales strategy is to recoup the cost by ensuring the customer stays with the company for at least a few years.

Business Financials

In 2009, DTV posted total revenues of $21.6 billion, an increase from its 2008 total revenues of $19.7 billion.[2] However, its net income did not have an increase. Between 2008 and 2009, DTV's net income declined by 50%, from $1.52 billion in 2008 to $1.01 billion in 2009.

Business Segments

DirecTV operates through 2 primary segments: i) DirecTV U.S., and ii) DirecTV Latin America.

DirecTV U.S.

This segment distributes over 1,700 digital video and audio channels, including 70 XM Satellite Radio music channels, 31 premium movie channels, over 35 regional and specialty sports networks, 95 Spanish and other foreign language channels, and over 45 pay-per-view channels.

DirecTV Latin America

DirecTV Latin America is the leading provider of digital television services throughout Latin America, which includes South America, Central America, and the Caribbean. DTV LA provides service under the DIRECTV and SKY brands to approximately 1.3 million subscribers in Brazil and approximately 1.4 million subscribers in the rest of South America. DTV's affiliate, Sky Mexico, has approximately 1.4 million subscribers in Mexico.

Trends and Forces

Bundling

Bundling is the marketing strategy of cross-selling customers across cable, Internet, and voice services. For example, Comcast (CMCSA) offers this bundled service as the "Triple Play" and charges approximately $99 per month. Consumers benefit because they have one consolidated monthly bill, and one company to deal with if there are problems. DTV primarily offers entertainment and has begun to offer high-speed internet through a partnership with AT&T (T) and other internet service providers. However, DTV still doesn't offer voice services and may therefore face tough competition from the cable industry, if customers favor the full bundling option.

Housing Market

With more than 85% of television owners already paying for cable or satellite services, the number of new potential cable customers is small. New homes provide new potential customers for cable companies and as a result, growth in the cable industry is closely tied with growth in the housing market. Recent deceleration of the housing market could mean a loss of growth for DTV's service.

FCC Regulation

The FCC covers communications by radio, television, wire, satellite and cable in the United States. New regulation, such as the rule requiring all new TVs to contain a tuner capable of receiving digital broadcasts, instead of the old analog signals, by 2009, can have significant impact on the industry.[3] The switch to digital could benefit DTV, since it is currently the leading carrier of HD and digital channels.

Competition

DTV faces competitors in the satellite television market and in the home entertainment sector at large. EchoStar Communications (DISH) is its main competitor in the satellite television market and has nearly 13 million customers. However, DirectV is sold in more electronic retailing stores than Echostar, and as a result Echostar must spend more on advertising to spread the word of its existence than DirecTV. DirecTV also has an advantage over EchoStar, by providing the most comprehensive offering of HD programming. DTV also faces tough competition from cable television competitors such as Time Warner Cable, Comcast, and Charter Communications (CHTR).

Reference

  1. DTV 10-K 2009 Item 1 Pg. 4
  2. DTV 10-K 2009 Item 7 Pg. 51
  3. Boston Globe
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