DirecTV Expects 9 Million Advanced TV Subscribers by 2008
DirecTV expects to have 9 million subscribers by 2008 for its advanced set-top box HD and PVR platforms, as penetration nears 50%, Investor Relations Vp Jonathan Rubin told last week’s PacificCrest Digital Media & Entertainment conference in N.Y. That’s up from last year’s 5 million subscribers, or 30% penetration, split between PVR (3 million) and HD (2 million), Rubin said.
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The key to getting more HD subscribers is offering more channels and curing software bugs seen in Aug., when the HR20-700 combo PVR/HD satellite receiver debuted. DirecTV plans to expand the number of HD channels from 10 with local coverage in 65% of U.S. markets to 100 with coverage in 75%, following the June launch of the DirecTV-10 satellite to 99 degrees W. A 2nd satellite, DirecTV-11, was to launch to 103 degrees W., but no launch has been set, Rubin said.
The satellites each will have space for 750 spot beams or 75 national HD channels, officials have said. The goal is to consolidate delivery of DirecTV HD feeds now transmitted from several satellites, including those at 101 degrees, 110 degrees and 119 degrees -- on the new birds by 2008, the company has said. DirecTV-10 and DirecTV-11 will replace Spaceway-1 and Spaceway-2 satellites launched in 2005 and now delivering local channels, Rubin said. DirecTV capital expenses are expected to hit $800 million this year as a result of satellite launches, then drop to $300-$400 million in 2008, Rubin said.
DirecTV has made progress in resolving technical issues noted after the HR20-700’s introduction. Complaints surfaced last fall that the device repeatedly failed to record programs and/or froze when users tried to fast forward or rewind. To resolve the problems, DirecTV has sent several software upgrades to the set top. The issues arose as DirecTV began to switch its set tops to NDS’ PVR platform from TiVo’s.
DirecTV also is adding new services. It will launch a VoD service Q2, with mostly free content, a spokesman said. The VoD line will consist of existing DirecTV programming, including sports highlights, movies, HBO and others, said a spokesman. The service will push movies to a PVR’s hard drive for instant access or allow for a broadband connection, he said.
DirecTV has seen a slow start on its 5-year resale deal for WildBlue’s satellite-based Internet access service, Rubin said. DirecTV, which agreed last year to sell the service in rural markets, has signed “several thousand” subscribers for WildBlue, Rubin said. “I don’t think it’s on our radar yet” in terms of large numbers of subscribers, he said.