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This excerpt taken from the DTV 10-Q filed Nov 4, 2005. ABS-CBN Agreement During the third quarter of 2005, DIRECTV U.S. agreed to migrate ABS-CBN Broadcasting Corporation's, or ABS-CBN, more than 80,000 subscribers from its TFCDirect™ satellite service to the DIRECTV® service and entered into an exclusive agreement to carry its six-channel package that provides programming to the Filipino-American market. As a result of this agreement, DIRECTV U.S. recorded a subscriber related intangible asset in "Intangible Assets, net" in our Consolidated Balance Sheets amounting to $1.7 million during the third quarter of 2005, which represents the cost of migrated subscribers during the quarter. DIRECTV U.S. is amortizing this asset over the estimated subscriber lives of ten years. This subscriber related intangible asset is subject to increase as subscribers continue to migrate over a one year migration period as well as for incentive payments that will be made to ABS-CBN for subscribers who meet a minimum subscription period. If all subscribers are successfully migrated, DIRECTV U.S. would record an intangible asset of up to $12 million. |
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