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Guest Message by DevFuse

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I'm tired of DIRECTV's Creative Ways of Digging into my pocket


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#26 OFFLINE   damondlt

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Posted 11 August 2013 - 10:41 AM

Nor do they get away with paying only $888 for a four-room Genie system installed. The $888 number comes from their Q2 2013 SEC filing as the average cost of a new installation.
How many cycles do you suppose the average box survives? I bet it isn't anywhere near "many" and instead is probably less than two cycles.

And they are installing 4 room Genies daily to new customers , So your point is Moot!

 

Apparently its not hurting them cause they know in a year they will have made it back and then some!


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#27 OFFLINE   harsh

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Posted 11 August 2013 - 10:44 AM

Again Harsh Talk to us when Directv is showing NET Losses.

DIRECTV is in business to make money for their shareholders -- exclusively.
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#28 OFFLINE   damondlt

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Posted 11 August 2013 - 10:45 AM

DIRECTV is in business to make money for their shareholders -- exclusively.

You are absolutely Right!  

100% spot on.

 

See we do agree! :righton:


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#29 OFFLINE   harsh

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Posted 11 August 2013 - 10:50 AM

The Average Directv subscriber spends $93 per month on services.

The average DIRECTV subscriber pays $98.73/month

That's over $2200 for the terms of the contract.

The new customer pays a whole lot less than the average customer. Discounts of over 50% in year one aren't extraordinary. Year two is a big shock but there are still some discounts.

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#30 OFFLINE   damondlt

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Posted 11 August 2013 - 10:52 AM

DirecTV lost 50,000 plus subscribers in the US last year in this same quarter that it lost over 80,000 subscribers. The subscriber base in the US is falling. Lots of people giving up on pay TV and going back to their OTA and subscriptions like Netflix, etc.

In the quarterly report their profit margin is less than 10%. That is very low compared to other companies.

 

 

Because customer are tired of seeing big increases in fee's but yet don't see anything but more profit. 

 

On one hand we got these providers, claiming oh "we have to raise your rates because of inflation", 

but yet they at the same time they are saying

 "hey we need $10 but lets say $20 so we can make more money"  That's BS!


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#31 OFFLINE   jimmie57

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Posted 11 August 2013 - 10:54 AM

My friend just got a bundle thru AT & T with internet and DirecTV service. She switched from Dish.

She has an HR44 and 1 client. She has the program package just under the premier. She got all the movie channels free for 3 months. Her total bill for the first year is under $100 per month for TV and internet.


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#32 OFFLINE   damondlt

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Posted 11 August 2013 - 10:55 AM

The average DIRECTV subscriber pays $98.73/monthThe new customer pays a whole lot less than the average customer. Discounts of over 50% in year one aren't extraordinary. Year two is a big shock but there are still some discounts.

While I would agree with you on this in Directv favor, except New subscribers are less then 10 % of Directvs total customers.

Not very many getting these huge discounts.


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#33 OFFLINE   harsh

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Posted 11 August 2013 - 11:01 AM

Lots of people giving up on pay TV and going back to their OTA and subscriptions like Netflix, etc.

Rest assured that they're not giving up. They've likely shifted or quit so they can come back later to get new subscriber deals. Telco subscriptions are up in the 14-16% range.

OTA is not a long-term option for a pretty large majority. IPTV services are pretty thin and out of the picture for many who don't have fat pipes to the Internet. We hear accounts often of those that have experimented with cutting the cord and how they're not particularly satisfied.

Q2 is a pretty predictable quarter for lower numbers so it should not be taken as a sign of paradigm shift.

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#34 OFFLINE   n3vino

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Posted 11 August 2013 - 11:24 AM

My friend just got a bundle thru AT & T with internet and DirecTV service. She switched from Dish.

She has an HR44 and 1 client. She has the program package just under the premier. She got all the movie channels free for 3 months. Her total bill for the first year is under $100 per month for TV and internet.

I got Uverse internet 12MPS and D* with one HDVR, two H25s, HD, whole home, and protection plan, with all the other incentives that come with it, at the same time, but not as a bundle.  My bill was under $100. the first year.  A year and a half later, I added a Genie so that gave me one extra receiver and my bill nearly doubled for both services together after the promotion period ended and price increases from D*. Your friends will also go sky High the 2nd year, depending on what speed internet she has.


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#35 OFFLINE   longrider

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Posted 11 August 2013 - 11:26 AM

I am surprised how many people are saying things like "I pay $100 a month for 24 moths, that more than covers the $800 it cost to sign me up"  The great majority of that $100 goes to paying for the ongoing costs such as what they have to pay providers for programming, operating costs of uplink centers, etc, etc.

DIRECTV is in business to make money for their shareholders -- exclusively.

While that is true at the most basic level, business in general (not just DirecTV) has made way too narrow a focus on that and has lost sight of the bigger picture that to be successful you need to provide a product people want, at an acceptable quality level, and at a price people are willing to pay.  Granted in this discussion DirecTV is the middleman and it is the content providers that are missing the bigger picture but i see this in way too many businesses.


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#36 OFFLINE   acostapimps

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Posted 11 August 2013 - 11:29 AM

At least for one thing they're giving me credits for HD fee,DVR fee and package discounts for the time being, no way would I want it at the $100 mark or I'll change to lesser priced package, But now im paying in the mid $70's price.


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#37 OFFLINE   damondlt

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Posted 11 August 2013 - 11:40 AM

I am surprised how many people are saying things like "I pay $100 a month for 24 moths, that more than covers the $800 it cost to sign me up"  The great majority of that $100 goes to paying for the ongoing costs such as what they have to pay providers for programming, operating costs of uplink centers, etc, etc.

.

I am surprised that so many people think or imply that Directv is out this money!

Clearly they are making a truck load of money.!

 

Directv makes their prices and sets their prices to make money, Not break even or take a loss.  Directv wouldn't make their minimum commitment agreement $29.99 if that meant they would be taking a loss.

 

They came up with this number for a reason!

 

Choice Extra wouldn't cost you $70.99 if it cost Directv $71 to provide it to each customer.


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#38 OFFLINE   Milkman

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Posted 11 August 2013 - 12:05 PM

are you referring to just the modem fee or the per TV fee. folks that have cable ready TVs and just need an access card still have to pay a monthly fee

 

 

+1

 

I'm a little confused by Milkman's asymmetrical comparison here;

 

DIRECTV doesn't have a Cable internet service to even offer such an option for one to purchase their own cable modem.  :confused:

 

The argument was a little asymmetrical, but the BS leasing charge really gets under my skin.  If I pay $200.00 for a receiver I should NOT have to pay the stupid $6.00 per month charge.  If I pay nothing for the receiver, I totally get it - I just don't like the idea of being double charged.

 

What TWC/BHN does with the modem charge is exactly how other providers should handle the per month charge.  Pay per month forever OR buy your own and get no charge.  To get both is ridiculous.


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#39 OFFLINE   longrider

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Posted 11 August 2013 - 12:14 PM

I am surprised that so many people think or imply that Directv is out this money!

Clearly they are making a truck load of money.!

 

Directv makes their prices and sets their prices to make money, Not break even or take a loss.  Directv wouldn't make their minimum commitment agreement $29.99 if that meant they would be taking a loss.

 

They came up with this number for a reason!

 

Choice Extra wouldn't cost you $70.99 if it cost Directv $71 to provide it to each customer.

I think we are saying the same thing just from different perspectives.  DirecTV absolutely is profitable but that $100 a month is not in any way all profit.  These numbers are straight from DirecTVs financial statement:  60% of gross income goes to COGS, what they pay for the programming plus I would guess a lot of the cost of running uplink centers and installation goes there. 25% goes to the cost of running the business. The is leaves 15% for profit and taxes take a third of that  so only 10% is actually profit.  In other words you could take out all profit and your $100 bill would only go down to $85 


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#40 OFFLINE   Gloria_Chavez

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Posted 11 August 2013 - 12:37 PM

OTA is not a long-term option for a pretty large majority. IPTV services are pretty thin and out of the picture for many who don't have fat pipes to the Internet. We hear accounts often of those that have experimented with cutting the cord and how they're not particularly satisfied.

 

OTA won't appeal to a majority.  But it is appealing to far more each year.

 

-------

  August 6, 2013, 8:14 p.m. ET

CBS-Time Warner Cable Dispute Shows an Industry Unaware of Reality

 

http://online.wsj.co...1175622986.html

 

It was a mere coincidence that news of the Post sale broke right after Mr. Britt had sent his latest missive to Mr. Moonves in a months-long squabble over money. But the timing highlighted the essence of what another cable executive, Jim Dolan of Cablevision Systems Corp., CVC +0.67% was quoted saying Monday: The pay-TV industry is in a bubble. And it remains perilously out of touch.

...............

 

But as Messrs. Dolan and Ergen have acknowledged, these arrangements aren't sustainable. Younger people watch what they want online, making the idea of cable TV less appealing. The percentage of people age 13 to 33 subscribing to pay TV fell to 76% this June from 85% in June 2010, a new study by research firm GfK found.

 

"Cord cutting used to be an urban myth. It isn't any more," said cable analyst Craig Moffett in a report Tuesday.

-------

 

How profitable is DTV?  Anyone who crunches numbers will tell you that an operating margin of 20% or more is exceptional.

 

From its 2Q13 earnings report, DTV reported an EBIT margin of 20.9%.  Its EBITDA margin is 27.8%. (FOR DTV US OPERATIONS)

 

Up until one decade ago, The Washington Post once had similar margins, with an EBIT margin of 25%, sustained, year after year.  As Buffet said, owning a newspaper was having a license to print money.

 

Today, its operating margin is 2%.


Edited by Gloria_Chavez, 11 August 2013 - 12:40 PM.

Since 1995 the average cable bill has increased 122%, while TV consumption per household just 13%.

http://www.multichan...1_Per_Month.php

http://blog.nielsen....-all-time-high/

#41 OFFLINE   unixguru

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Posted 11 August 2013 - 12:51 PM

These numbers are straight from DirecTVs financial statement:  60% of gross income goes to COGS, what they pay for the programming plus I would guess a lot of the cost of running uplink centers and installation goes there. 25% goes to the cost of running the business. The is leaves 15% for profit and taxes take a third of that  so only 10% is actually profit.

 

I suspect the 25% cost of running the business includes all hardware/software development and operation, both uplinks and receivers.  As well as customer service, sales, marketing, general operations, etc, etc.  If it doesn't then they are incompetent.

 

The biggest bite is the programming.  The very thing that has been a rapidly increasing cost for some time.  A mostly uncontrollable cost in the current climate.  An unjustifiable cost IMO.  Something has to give - either DirecTV and/or customers need more leverage on this.

 

The government needs to step in and restore balance in the market.



#42 OFFLINE   Laxguy

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Posted 11 August 2013 - 01:15 PM

No, please, no Gov't. intervention. Yes on righting inequities that they caused, but heavens! Washington running our TV services?? NO! We'd never have Breaking Bad if that were the case. And, and and....


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#43 OFFLINE   PCampbell

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Posted 11 August 2013 - 01:36 PM

When the cost gets to high more will drop the service and thats when changes will start to happen. TWC and ATT UVerce here are about the same in cost as Directv and have add on chages also so the only choice is to call and ask for a discounts or drop the service. TV service is not needed to live like food and housing.


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#44 OFFLINE   longrider

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Posted 11 August 2013 - 01:40 PM

Government intervention is the last thing I want.  While it could control costs it would definitely control content and that  would destroy it.


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#45 OFFLINE   longrider

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Posted 11 August 2013 - 02:10 PM

This discussion made me study DirecTVs financials a little closer and while their Income Statement is decent their Balance Sheet looks terrible.  Over the past 5 years they have wiped out almost 10B of equity, while this is partly due to depreciation (a 'paper' expense in that no money actually left the company) the long term debt has more than tripled in 5 years.  While it is great to see that they are willing to invest for the future this trend has to turn around.  They unfortunately are at a point that any attempts to increase revenue will be ineffective in that any increase in ARPU will be cancelled out by the net loss of customers.


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#46 OFFLINE   Laxguy

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Posted 11 August 2013 - 02:37 PM

Depreciation, etc., doesn't "wipe out" equity. Shareholder's Equity has increased over the last three years, as has Net Income.

 

Indeed they are more leveraged than before but that alone isn't cause for concern, but as you mentioned, ARPU and maintaining or increasing those units will be key. 


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#47 OFFLINE   longrider

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Posted 11 August 2013 - 02:50 PM

I may have used the wrong term as this is not my area of expertise but from their financial statement http://www.marketwat...s/balance-sheet shareholder equity has gone from <194M> in 2010 to <5.43B> in 2012 and on the asset side the depreciation is subtracting from the value of the assets


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#48 OFFLINE   Laxguy

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Posted 11 August 2013 - 03:16 PM

It looks to me as though DIRECTV has made major buybacks of their common stock. 

Depreciation occurs whether it's recognized on the Income Statement (and hence the Balance Sheet) or not. It's a book entry, usually a tax-deduction.


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#49 OFFLINE   tonyd79

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Posted 11 August 2013 - 05:14 PM

No, please, no Gov't. intervention. Yes on righting inequities that they caused, but heavens! Washington running our TV services?? NO! We'd never have Breaking Bad if that were the case. And, and and....


I agree that the government has other things to concern itself with but as far as the government killing quality TV, try to tell that to the BBC. I find myself watching more and more BBC originating programs every year and we get more of them (as well as a large number of successful shows going as far back as All in the Family were actually conceived under "government control" in Great Britain).

Of course, our government has a way of screwing things up uniquely.
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#50 OFFLINE   SledgeHammer

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Posted 11 August 2013 - 05:31 PM

 

Additional TV - Charge

Additional TV - Charge

Additional TV - Charge

Advanced Receiver-HD -Charge

Advanced Receiver-DVR - Charge

DIRECTV Protection Plan - Charge

DIRECTV Whole-Home DVR Service - Charge"

 

I'm confused here. The protection plan is a complete waste of $$$, you don't need that. Unless you constantly bug DTV with issues and you're a good customer, theyll generally fix stuff for free.

 

Whole Home DVR, yeah, thats only $3, but also a waste of $$$. Just record it on the TV you plan to watch it on. Or walk over to your main TV.

 

I'm more pissed off on the more ridiculous charges. Like the $2 I pay for "regional sports fee". I have HONESTLY (and I'm not exagerrating here) NEVER watched a sports game on TV. Not even once. Not even the olympics. Sports just bore me. Yet I pay $2 a month for them.

 

The $10 for HD is also ridiculous. Dish gives it out for free. So do most other providers. Yet, I have to call in every 6 months to get a credit. Yeah, I'm getting a credit, but I'd rather not have to call in and get it. I've been with DTV since 2002 and have always paid my bill, yet some newbie comes in and gets free HD for life? yeah, I'm gonna complain.

 

$10 / month for the HD DVR is also a bit crazy. I already paid for the box.

 

I'm betting it doesn't cost DTV $10/month/household to get the guide info.






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