PrimeStar Partners L.P. has named RadioShack as the first-- and, for now, the exclusive -- retailer authorized to sell its direct-to-home satellitesystem for $149.
RadioShack will offer the hardware for sale startingtomorrow (April 1). PrimeStar is also set to complete the first stage of its roll-up intoPrimeStar Inc. that same day.
Mearle Eakins, vice president of retail sales forPrimeStar, said research shows that about 20 percent of PrimeStar customers prefer to own,rather than to lease, a satellite system. As prices for PrimeStar and competingdirect-broadcast satellite hardware continue to drop, that level could go to as high as 40percent, he added.
"Now, if a guy really wants to own the system,we're not losing him to the competition," Eakins said. "We'readdressing 100 percent of the market."
PrimeStar will continue to offer its lease option, whichboasts a lower cost of entry. Consumers typically pay a $149 installation fee, butPrimeStar is running a $50 installation-rebate promotion, which brings that figure down toas low as $99.
Rick Borinstein, senior vice president of merchandising forRadioShack, said PrimeStar's lease model has been very attractive to consumers todate. He added that he has not heard any feedback that RadioShack customers have beenclamoring to purchase, rather than to lease, PrimeStar equipment.
RadioShack's decision to sell the PrimeStar hardwarewas not based on any financial incentives, Borinstein said. "The financial model is anonissue for us," he said. "We just want to do what's right for thecustomer."
Purchasing the hardware lowers a subscriber'sprogramming bill by $10 per month. The $149 hardware price includes a dish, a dual LNB(low-noise-block downconverter) and an integrated receiver-decoder for PrimeStar'scurrent medium-power service, as well as the company's PrimeFinder remote.Installation is extra.
Eakins said PrimeStar has yet to consolidateplans to offer a companywide promotion for discounted second receivers.