Looking at DirecTV's Price Hike Wall Street reacted to news that DirecTV plans to raise its subscription rates, which the company said could amount to a price hike of about 4 percent based on a customer's average monthly bill. The new prices take effect March 1. Craig Moffett of Bernstein Research pointed out in a research note that DirecTV's price increase comes on the heels of similar price hikes by cable MSOs and EchoStar. He said the DirecTV rate jump "is consistent with our view that the competitive intensity in the sector remains restrained." Moffett added, "As has been the case with increases recently announced by EchoStar and Comcast, the increases are largest - on a percentage basis - for introductory packages, and are smaller for high-end packages. We have previously referred to this strategy as flattening the demand curve, whereby the relative hurdle for upgrading to richer tiers is lowered even as prices rise across the board." What was surprising to Moffett, however, is DirecTV's plan to increase rates for new subscribers more than for existing viewers. "This appears to be a clear indication that, at this point, churn management is a higher priority than new subscriber growth," Moffett said. In response to questions about the rate hike, DirecTV spokesperson Robert Mercer said fees charged for programming have significantly outpaced the average increase of a customer's bill, which will show a jump slightly greater than 4 percent. "DirecTV continues to be a far better value than cable whose average annual price increases have typically been higher," Mercer said. "We continue to invest in the quality of the DirecTV viewing experience, such as launching new satellites to bring local stations to over 93 percent of the country, more high definition and even greater number of channels and original programming to enjoy."