This excerpt taken from the DTV DEF 14A filed Apr 27, 2007.
Evaluating pay practices among the peer group assists the Committee to determine the appropriate total target value of the primary compensation elements of the executive officers' compensationbase salaries, annual bonuses and long-term incentivesas well as the relative proportions of those elements. In determining the appropriate amount for each of these elements, the compensation paid for similar positions at other corporations within a peer group of companies is reviewed annually.
The current peer group companies were selected in 2004. The list is reviewed and assessed periodically to determine if a modification is appropriate. The Consultant developed the list in order to focus on companies in the entertainment, content development and distribution industries and incorporated suggestions from management and the Chairman of the Compensation Committee. The selected peer companies fall within a range (both above and below the Company) of comparison factors such as revenue, market capitalization and net income; thus, companies that were significantly larger or smaller than the Company were excluded from the final list.
The 19 companies comprising the peer group from 2004 to 2006 were:
In November 2006, the Committee modified the peer group based on a report from the Consultant and input from the Company and the Chairman of the Compensation Committee. The Committee discussed changes in the Company's strategic direction, changes in revenue, market capitalization and net income of the existing peer group, mergers and spin-offs of companies, and the growth of newer companies in the entertainment industry. Following the discussion, the Committee approved the following changes to the peer group: remove AT&T Corp., BellSouth Corp., and Hearst Argyle Television, Inc., and add British Sky Broadcasting Group, plc. (BSkyB), CBS Corporation (CBS), News Corporation, Sirius Satellite Radio, Inc. and XM Satellite Radio, Inc.
The 21 companies comprising the updated peer group are: