DawgLink
05-26-09, 09:04 AM
http://uk.sys-con.com/node/960857
For the past four quarters the Company has been implementing an ambitious and comprehensive plan to upgrade its properties and current DIRECTV high definition ("HD") subscribers to the newly launched DIRECTV MFH-2 Platform ("HD Platform") and expanded line-up of DIRECTV HD and International programming services. During the second fiscal quarter, the Company upgraded 10,105 units in 43 properties to the new DIRECTV HD Platform and had another 2,061 units in 10 properties that were work-in-progress at quarter's end. The Company is in the final stages of its upgrade program and expects to complete the upgrade of an additional 18,125 units in 109 properties on or before July 31, 2009. At that time, the Company expects to have upgraded approximately 72,000 units in 375 properties. DIRECTV is providing certain financial assistance for the upgrade to the new HD Platform through July 2009, however, they have recently offered the Company an additional incentive to complete certain property upgrades prior to June 30, 2009. As a result, the Company is accelerating its upgrade efforts.
Property upgrades to the new HD Platform usually involve potentially lengthy negotiations with ownership groups or condominium boards; addendums and extensions to access agreements; new property site surveys; new return on investment calculations; executive review and approval of each potential upgrade; scheduling and supervising a significant number of experienced contractors; upgrade or replacement of the building satellite reception equipment; a re-wire of the satellite distribution backbone structure; connecting individual customer unit wiring to HD distribution demarcations; scheduling and exchanging many previously installed customer set-top receivers; and, a total re-marketing of the property to advertise the new HD and International services. This detailed product life cycle has already taken place in 265 properties as of March 31, 2009 and each upgrade comes up just short of the total amount of time and effort the Company would normally invest obtaining, negotiating and wiring a net new property to DIRECTV services. As a result of this experience, the Company has significantly expanded its capabilities and will draw upon these capabilities when it begins to accelerate new subscriber growth in upcoming periods.
Property upgrades to the new DIRECTV HD platform are essential as subscribers and property owners demand state-of-the-art technology and want access to DIRECTV's unparalleled comprehensive offering of HD and International programming and services. DIRECTV currently offers over 130 (moving to 150) HD national programming channels and has HD local programming in more than 94% of all U.S. markets. The continued launch and advertising campaign for the new DIRECTV HD programming and associated services will continue to provide incremental revenue and improved penetration rates within Company properties. Additionally, these upgrades are resulting in property access agreement extensions and renewals, increased penetration rates within these properties, increased sale of advanced services and an increase in the Company's DIRECTV subscriber residual, all of which continue to positively impact the Company's financial results.
For the past four quarters the Company has been implementing an ambitious and comprehensive plan to upgrade its properties and current DIRECTV high definition ("HD") subscribers to the newly launched DIRECTV MFH-2 Platform ("HD Platform") and expanded line-up of DIRECTV HD and International programming services. During the second fiscal quarter, the Company upgraded 10,105 units in 43 properties to the new DIRECTV HD Platform and had another 2,061 units in 10 properties that were work-in-progress at quarter's end. The Company is in the final stages of its upgrade program and expects to complete the upgrade of an additional 18,125 units in 109 properties on or before July 31, 2009. At that time, the Company expects to have upgraded approximately 72,000 units in 375 properties. DIRECTV is providing certain financial assistance for the upgrade to the new HD Platform through July 2009, however, they have recently offered the Company an additional incentive to complete certain property upgrades prior to June 30, 2009. As a result, the Company is accelerating its upgrade efforts.
Property upgrades to the new HD Platform usually involve potentially lengthy negotiations with ownership groups or condominium boards; addendums and extensions to access agreements; new property site surveys; new return on investment calculations; executive review and approval of each potential upgrade; scheduling and supervising a significant number of experienced contractors; upgrade or replacement of the building satellite reception equipment; a re-wire of the satellite distribution backbone structure; connecting individual customer unit wiring to HD distribution demarcations; scheduling and exchanging many previously installed customer set-top receivers; and, a total re-marketing of the property to advertise the new HD and International services. This detailed product life cycle has already taken place in 265 properties as of March 31, 2009 and each upgrade comes up just short of the total amount of time and effort the Company would normally invest obtaining, negotiating and wiring a net new property to DIRECTV services. As a result of this experience, the Company has significantly expanded its capabilities and will draw upon these capabilities when it begins to accelerate new subscriber growth in upcoming periods.
Property upgrades to the new DIRECTV HD platform are essential as subscribers and property owners demand state-of-the-art technology and want access to DIRECTV's unparalleled comprehensive offering of HD and International programming and services. DIRECTV currently offers over 130 (moving to 150) HD national programming channels and has HD local programming in more than 94% of all U.S. markets. The continued launch and advertising campaign for the new DIRECTV HD programming and associated services will continue to provide incremental revenue and improved penetration rates within Company properties. Additionally, these upgrades are resulting in property access agreement extensions and renewals, increased penetration rates within these properties, increased sale of advanced services and an increase in the Company's DIRECTV subscriber residual, all of which continue to positively impact the Company's financial results.