DIRECTV Conference Call-Part 2

After reviewing their quarterly results, Direct TV took questions from Wall Street about their numbers and what they foresee for the rest of 2008.

Goldman Sachs asked about any impact the economy and housing market was having on DIRECTV, and also if the upcoming digital transition was helping the company. Mr. Carey noted the economy was pretty much a non-factor in their business right now. He also noted that the digital transition was not really a factor either, as it doesn’t happen until February 2009, and people aren’t thinking about it. Numbers continued to be driven by HD, and DIRECTV has a “real window” in which they have a leadership position. That is what continues to drive subscription growth.

UBS asked about ARPU, average revenue per subscriber growth, and Latin American growth. Carey replied that the mix of advanced services, HD and DVR, combined with a price increase earlier this year contributed to the ARPU growth. Bruce Churchill commented on Latin America, saying the growth is not from one area, but three well performing nations, Brazil, Venezuela, and Argentina together.

Deutsche Bank asked about WiMAX technology, and if DIRECTV is looking at getting into the business, as DISH Network was a winner of some licenses at the recent FCC 700 megahertz auction. Carey said while WiMax and mobile video is something to monitor, it is probably a five year proposition. Nothing material will come in the next 1-2 years. Carey also mentioned “defining the customer appetite” for mobile video, meaning how much TV will people really want to watch on a tiny cell phone screen. Competition is a huge factor in this area as well, with AT&T and Verizon dominating the area.

Stifel Nicolaus asked about the impact Verizon FiOS and AT&T U-verse are having on DIRECTV. Interestingly, Carey separated the two, calling Verizon FiOS a “competitor” while downplaying the impact U-verse is having. Verizon is spending the money, and going after the customers where FiOS is deployed. DIRECTV feels they can compete with Verizon, but it does add the extra competition in those markets. According to Carey, AT&T is not a significant factor yet. “I think there’s a ways before it’s really a viable mainstream television option for American households,” was how U-verse was characterized.

Read DIRECTV Conference Call-Part 1

Read DIRECTV Conference Call-Part 3

by Aaron Kemp on May 9, 2008 · 1 comment

tagged as 700 megahertz, ATT, direct tv, DIRECTV, dish network license, fios, hd, mobile video, u-verse, verizon, wimax in DIRECTV