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Directv Price 4% hike 3/1


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#1 OFFLINE   vlj9r

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Posted 25 January 2006 - 06:15 AM

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."

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#2 OFFLINE   vlj9r

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Posted 25 January 2006 - 06:17 AM

DirecTV Price Increase Details
Last week, DirecTV sent a letter to its retailers saying that the company is raising the cost of its programming packages across the board beginning March 1. And what has most people talking is that the new prices under DirecTV's plan will increase more for new subscribers than they will for existing ones.

For new subs, the introductory Total Choice package will increase $3 per month (7.1 percent) from $41.99 to $44.99; the Total Choice Plus package will increase $4 (8.7 percent) from $45.99 to $49.99 and the top Total Choice Premier package will increase by $6 (6.4 percent) from $93.99 to $99.99.

For existing subs, DirecTV has announced a $3 increase across all programming packages. After March 1 the Total Choice package will increase from $41.99 to $44.99 (7.1 percent); the Total Choice Plus from $45.99 to $48.99 (6.5 percent) and Total Choice Premier from $93.99 to $96.99 (3.2 percent).

"The price adjustments are designed primarily to offset the higher programming costs that we pay to carry many of the networks and programming services we provide our customers," the company said in the letter. "Other costs associated with the price increase include significant investments we have made for new technologies and exclusive content."

DirecTV said that the price increase will not apply to the DirecTV PARA TODOS or other international programming services, nor to pay-per-view movies or a la carte services like premium movie channels and local channel packages.

DirecTV began notifying customers this week of the change in rates.

Asked if the price increase will negatively impact sales the company said, "No. Consumers will compare our service to cable TV and will see that we continue to offer a competitive service and a great entertainment value."

#3 OFFLINE   rid0617

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Posted 25 January 2006 - 07:44 AM

I am just about to cancel and go back to an antenna. $50 a month for the trash on TV now a days is ridiculous. I have been a DIRECTV customer since 1997 and there have been more price increases in 3 years than there were since it come out. Everything keeps going up, income stays flat and when you call customer service you have to deal with India. Uncalled for.

#4 OFFLINE   Mark Holtz

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Posted 25 January 2006 - 08:05 AM

At least the other shoe has dropped. The only good part is that we don't have to deal with three dropped channels and a channel operator running full-page ads painting the company as a demon.

There are a few gems on TV... you just have to know where to look for them. Of course, beauty is in the eye of the beholder.

Blame some of the price increases on the escalator clauses put in by the channel carriage contracts. The price is based upon how many potential eyeballs are out there... whether or not you actually watch the channel. The most expensive channels have to be E$PN and the R$Ns.
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#5 OFFLINE   hdtvfan0001

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Posted 25 January 2006 - 08:56 AM

With TC Plus and the HD package, my monthly fee is going up only $2. I can live with that. My neighbor's Comcrap cable is going up $3.50.

#6 OFFLINE   Chris Freeland

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Posted 25 January 2006 - 09:00 AM

The one thing that puzzles me is that these press releases claim their are no price increases on Premium services, this does not add up, the price of TC Premier for new customers is going up $6 from $93.99 to $99.99, however TC Plus for new customers goes up only $4 from $45.99 to $49.99, which means that the price of having all 5 premiums for new customers must be going up $2. The current rate for Premiums is 1 = $12, 2 = $23, 3 = $33, 4 = $41 and all 5 = $48, $49.99 + $48 = $97.99, not $99.99. Their must be a premium channel increase in their some where. Unless D* has invented some kind of all new math :D .

#7 OFFLINE   Joe C

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Posted 25 January 2006 - 09:00 AM

DirecTV Price Increase Details

"The price adjustments are designed primarily to offset the higher programming costs that we pay to carry many of the networks and programming services we provide our customers," the company said in the letter. "Other costs associated with the price increase include significant investments we have made for new technologies and exclusive content."



Well that sucks, we does the rest of the sub base have to subsidize NFLST?

#8 OFFLINE   ansky

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Posted 25 January 2006 - 10:15 AM

With TC Plus and the HD package, my monthly fee is going up only $2. I can live with that. My neighbor's Comcrap cable is going up $3.50.

I can live with a $2 or $3 increase per month. Some people spend more than that on a cup of coffee every day.

#9 OFFLINE   ganz

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Posted 25 January 2006 - 10:17 AM

$2-$3. It could be alot worse! DTV is still so much better than any cable co. I've ever had. And still about the same cost per month.

#10 OFFLINE   durl

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Posted 25 January 2006 - 10:23 AM

I hate to see another price increase, but I can handle it. When I first signed up back in the 90's, it seems like we went years without an increase while cable bills were going up $2-3 a year.

Mark makes a good point. How much of the increase is due to networks charging WAY too much for their programming?

#11 OFFLINE   brzmkla

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Posted 25 January 2006 - 10:23 AM

The one thing that puzzles me is that these press releases claim their are no price increases on Premium services, this does not add up, the price of TC Premier for new customers is going up $6 from $93.99 to $99.99, however TC Plus for new customers goes up only $4 from $45.99 to $49.99, which means that the price of having all 5 premiums for new customers must be going up $2. The current rate for Premiums is 1 = $12, 2 = $23, 3 = $33, 4 = $41 and all 5 = $48, $49.99 + $48 = $97.99, not $99.99. Their must be a premium channel increase in their some where. Unless D* has invented some kind of all new math :D .


just pointing out that the TC Premier also gives you access to all the RSN's plus a few additional channels on top of all the movie channels.

#12 OFFLINE   JLucPicard

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Posted 25 January 2006 - 10:26 AM

Maybe it's the mood I'm in right now or something, but this conversation just floors me. Or more directly, some of the harshness of the conversation just floors me. We all are trying to make things fit into our budgets and I understand that. But any time gas prices go up a nickel, dime, twenty cents a gallon, there goes an extrta couple of bucks into the tank.

As was mentioned by Mark Holtz, a lot of us have seen the fallout (and maybe tunnel vision here, but the more visible examples I've seen were with E*) of a channel being dropped by the DBS provider and the channel operator loudly proclaiming it's because the DBS provider won't pay them what they're worth. Programming contracts are being negotiated all the time, and the price of those things, I would suspect, are going up just like everything else.

As for NFLST, the cost of that service to the subscribers have also gone up, and we could play the game all day about "why do I have to subsudize the Home and Garden channel (or insert other channels here) when I never watch it anyway?".

And I guess if you want to pick nits, yes there most likely is some inherent increase on the premiums in the sense of how that all fits into the pricing scheme of the TCP package, but the ala carte prices are not changing.

Bottom line is, providing content costs money and that cost of doing business is normally passed along to the consumer, no matter what type of business it is. I have to give D* credit for the investment they are making in advancing the content they provide (which will be a process that doesn't happen overnight). I would be a fool to think that that doesn't come at some kind of cost.

I don't have an unlimited budget either, and if things were going up 10 or 20%, I'd probably be complaining, too. But a few dollars a month just does not seem that out of line to me.

#13 OFFLINE   Smthkd

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Posted 25 January 2006 - 11:20 AM

With TC Plus and the HD package, my monthly fee is going up only $2. I can live with that. My neighbor's Comcrap cable is going up $3.50.

Yeah but your neighbors Comcrap cable has a better HD lineup that justifies its price increase, they only thing we got is a rediculous 1 hr/week HD broadcast of CD USA!:nono2:

#14 OFFLINE   Chris Freeland

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Posted 25 January 2006 - 11:34 AM

just pointing out that the TC Premier also gives you access to all the RSN's plus a few additional channels on top of all the movie channels.


I realize that, but my point is that before March 1, 2006, the price difference between TC+ and TC Premier is only $48, however for new customers after March 1, the difference of $2, same package, same channels, but this means that their must be a price increase somewhere for Premiums (and yes I am including the Sports pack) even though D* is claiming their is no increase for Premiums. Why can't D* come clean and give us the details on the premium packages too.

#15 OFFLINE   Bobman

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Posted 25 January 2006 - 11:45 AM

There goes my raise ! :( I received a 4% increase this year which I was kinda happy about until I did all the math. DirecTV goes up 4%, my Gas & Electric bill went up almost 40%, gas for my car went up 30-35%, water & sewage went up on my house a couple percent, thanks to some new law credit card companies changed the way they charge us monthly so now my minimums have been going up, etc....

Even with a 4% yearly increase I actually have less spend money than last year.:mad:

#16 OFFLINE   Clemsole

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Posted 25 January 2006 - 11:55 AM

Everybody cry's that they want all the new things made available to them like mix channels, HD channels, enable the USB ports but when the price goes up to cover the cost of adding some of these features everybody cry's about the cost. Face up to it people if you want it you have to pay for it, if your unhappy with it go some where else.

#17 OFFLINE   orie

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Posted 25 January 2006 - 12:45 PM

a few dollars. big deal.

It's still cheaper than cable.

#18 OFFLINE   harsh

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Posted 25 January 2006 - 02:49 PM

As for NFLST, the cost of that service to the subscribers have also gone up, and we could play the game all day about "why do I have to subsudize the Home and Garden channel (or insert other channels here) when I never watch it anyway?"

Somehow it seems like since NFLST is a D* exclusive, then it naturally has more impact than a network that stands on its own.

#19 OFFLINE   harsh

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Posted 25 January 2006 - 02:55 PM

I am just about to cancel and go back to an antenna.

The problem with OTA is that you need to invest in a good DVR as you'll need something to skip the three minutes of commercials in every ten minute segment. I feel compelled to record all big four programming that I want to watch so that I can skip the commercials. The broadcast networks need to charge a whole lot more for a whole lot fewer commercials. Nobody needs that many potty breaks.

#20 OFFLINE   hdtvfan0001

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Posted 25 January 2006 - 04:58 PM

a few dollars. big deal.

It's still cheaper than cable.

Ditto. If you have the HD package (which is actually going down a buck), the NET increase is $2.00 / month. WHOPPEE :lol:




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