IPTV Programming Featured Article

DirecTV: Multi-Play Not Slowing it Down

By Gary Kim, Contributing Editor

Considering that the multi-product bundle is now a staple of Telco and cable marketing, one has to be impressed with how well DirecTV (News - Alert) has managed to do, essentially offering a stand-alone, single video product.

 

DirecTV's U.S. revenues were up 14 percent to $4 billion in its most-recent quarter, and average revenue per user was up more than eight percent to $79.70, says DirecTV CEO Chase Carey.

 

Much of the reason is advanced services purchases by its customers. DirecTV now has more than seven million subscribers buying advanced services, up more than 40 percent from a year ago.

 

DirecTV also hit an eight-year low monthly churn rate of 1.42 percent in the fourth quarter of 2007. In the first quarter of 2008 DirecTV had even-lower churn of 1.36 percent. Consistent with recent quarters, most of the churn improvement came from lower involuntary churn (customers disconnected for non payment).

 

Gross subscriber additions were up four percent to 964,000 as well. Net subscribers were up 17 percent to 275,000.

 

Note that Carey sees Verizon's (News - Alert) FiOS offering as a bigger competitive factor than AT&T's U-verse video offering.  "I probably wouldn’t put them in the same bucket," he says. "Where FiOS (News - Alert) exists, it is a competitive force in the market."

 

"I think U-Verse is probably not a competitive impact," Carey says. "I think there’s a ways before it’s really a viable mainstream television option for American households."

 

Wireless video also is going to be a market factor in the future, but over a three and five-year time frame, not near term, Carey argues.

 

Nor does Carey think video on demand will be as big a revenue contributor as digital video recorders and high definition content.

 

"As I’ve said before, I think DVRs and HD I think are much more powerful forces in the marketplace today," Carey says. “I think VOD will continue to grow but I think it will grow over a longer timeframe."

 

"Some of the content issues in terms of windows and the like are starting to be addressed but again, I think it takes time; habits take time; customers need to understand and start to use it," Carey notes.

 

Triple play and quadruple play does not necessarily mean all other contestants necessarily are doomed without such a strategy, it so far would appear. The caveat is that a provider probably must have a very-high value proposition, as DirecTV seems to offer its customers.

 

Gary Kim (News - Alert) is a contributing editor for TMCnet. To read more of Gary’s articles, please visit his columnist page.

 

 

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Internet Protocol (IP)	X
IP stands for Internet Protocol, a data-networking protocol developed throughout the 1980s. It is the established standard protocol for transmitting and receiving data in packets over the Internet. I...more

Triple Play	X
The Triple play refers to 1-multi-channel television (video), 2-telephony (voice) and 3-Internet (data) on existing twisted-pair wire, coaxial cable, satellite, BPL or other mean including a mix of an...more