DBS Providers Are Gaining Fast

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DirecTV Inc. and EchoStar Communications Corp. reported strong subscriber growth in the first quarter, adding a combined 800,000 net new subscribers.

DirecTV’s share was 460,000, almost double analyst forecasts. Cash flow declined below estimates, though, to $145 million, owing to higher acquisition costs and expenses related to additional set-tops and digital video recorders. SAC rose to $645 per subscriber. Churn was in line (1.45% per month), as was average revenue per unit (ARPU) at $63.60 per month.

EchoStar gained a net 360,000 customers, with SAC up 26%, to $604, and ARPU flat at $51.76. Monthly churn ticked up to 1.48% from 1.38% last year. Revenue rose 16%, to $1.58 billion. EchoStar has been offering new subscribers three set-tops for free: cash flow declined 20%, to $224 million.

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