DirecTV Scores Subscriber Increase
By Linda Moss -- Multichannel News, 11/11/2007 7:00:00 PM EST
DirecTV Group added 240,000 net subscribers in the third quarter, a 45% increase from the year-ago period, and is on target to have 100 high-definition TV services by year-end, the company said last week.
The nation's largest satellite-TV provider reported that as of Sept. 30, it had 16.56 million total subscribers, a 6% increase over its 15.68 million subscribers in the year-ago period. Gross subscriber gains in the quarter were 1,032,000, versus 1,006,000 last year.
Gains at the satellite provider came as cable competitors, including Comcast, Time Warner Cable and Mediacom Communications, have lost basic-video subscribers. (See related story above.)
The satellite provider's monthly churn rate in the quarter dropped to 1.61%, compared with 1.80% in the prior-year period.
“The headline for the third quarter is that significantly greater sales of high-definition and digital video recorder services to higher quality subscribers are having an extremely positive impact on the key operating metrics that drive DirecTV's value,” DirecTV president and CEO Chase Carey said in a statement.
AT A HIGH PRICE
Sanford C. Bernstein analyst Craig Moffett, in a report issued last week, described DirecTV's subscriber gain as “a clear win,” but noted that it had come at a high price.
“Retention-marketing costs — largely concentrated today in the capital spending associated with upgrading existing customers to HDTV — soared,” Moffett wrote.
In the third quarter, DirecTV's revenue increased 18% to $4.33 billion and operating profit before depreciation and amortization increased 12% to $1.00 billion, compared to last year's third quarter.
Third-quarter operating profit of $566 million and net income of $319 million declined 10% and 14%, respectively, compared with last year's third quarter.
Earnings per share were $0.27, compared with $0.30 in the same period last year.
TALKS WITH AT&T
Separately, Carey said during the third-quarter conference call that DirecTV is continuing to talk to AT&T about the future of their “bundling relationship,” but there's “not a whole lot more than that.” He also said that while the acquisition has turned out to be “frustratingly slow” to close, he expects Liberty Media's deal to acquire News Corp.'s 38.5% stake in DirecTV to be completed before the end of the year.
In October, The Wall Street Journal reported that AT&T's lawyers had been knocking on doors in Washington, seeking feedback on how long it would take the telco to secure government approval to buy either DirecTV or EchoStar Communications.
AT&T has partnerships with both the satellite companies to offer their video service, along with phone service, as part of a bundle to compete against cable.
DirecTV Loads Up 301,000 Subs In Q4
02/09/2009Chase Who? DirecTV Continues Gains
08/06/2009DirecTV Scores Significant Subscriber Growth
11/07/2007DirecTV Defies Gravity
02/15/2009DirecTV Plans 70 HD Nets
08/12/2007
