The DirecTV Group (DTV)

Note 5: Satellites, Net and Property and Equipment, Net

        The following table sets forth the amounts recorded for satellites, net and property and equipment, net at December 31:

        We capitalized interest costs of $54.5 million in 2006, $30.5 million in 2005 and $101.2 million in 2004 as part of the cost of our property and satellites under construction. Depreciation expense was $664.2 million in 2006, $501.6 million in 2005 and $651.4 million in 2004.

        On March 1, 2006, DIRECTV U.S. introduced a new set-top receiver lease program. Prior to March 1, 2006, most set-top receivers provided to new and existing DIRECTV U.S. subscribers were immediately expensed upon activation as a subscriber acquisition or upgrade and retention cost in the Consolidated Statements of Operations. Now, with the introduction of the lease program, most set-top receivers provided to new and existing subscribers are leased. During the year ended December 31, 2006, DIRECTV U.S. capitalized $598.6 million for set-top receivers leased to new subscribers and $472.9 million for set-top receivers leased to existing subscribers. Depreciation expense on these capitalized receivers was $147.3 million for the year ended December 31, 2006.

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Note 4: Satellites, Net and Property and Equipment, Net

        The following table sets forth the amounts recorded for satellites, net and property and equipment, net at December 31:

        We capitalized interest costs of $30.5 million in 2005, $101.2 million in 2004 and $120.0 million in 2003 as part of the cost of our property and satellites under construction. Depreciation expense was $501.6 million in 2005, $651.4 million in 2004 and $653.8 million in 2003.