In just a few moments, Mike White, CEO of DIRECTV will be speaking at Citi’s 2013 Global Internet, Media & Telecommunications Conference
I’ll do my best to keep up with the most important points today.
Had a good quarter, final results in February.
100,000 net adds in US
Latin America also exceeded expectations.
By 2016 want to take 10 basis points out of churn.
New “Genie Box to launch this year, 1/3 less expensive”, lowering SAC.
“Not a CEO in the US who doesn’t think their stock is undervalued” and DIRECTV is definitely buying stock.
Hope to reduce call volume by 20M each year (currently 125M/yr.) @$4-5 per.
Will continue to increase offers to existing customers.
Including a new box every two years for PP customers.
Downplays any talk of merging. Still major portions of country with minimal competition.
In about 20% of America, RSN costs are out of control. Currently have a surcharge of $2 or so for some new customers.
Will continue to work on controlling costs or carefully, selectively passing costs on. (Hard to have national pricing with certain RSNs trying to ask for lots of money.)
Still some large areas that have large market share upside potential in Latin America. Had some great successes in some countries, expects to extend that to rest of Pan-Americana (South American less Brazil.)
Goals are to double subs and double income in 5 years. So far on track at this point. (Plan is much of growth via Pan-Americana.
Brazil is very competitve and always has been. DIRECTV is working hard to beat the competition, using similar means as the US.
Time for Q&A
Questions about Latin America and how to decide when to expand there.
Sorry, no other major announcements or news.
The planning on spending more for existing customers sounds cool. The tease of a new, lower cost Genie box has to be interesting for us.
And on any talks of merger, Mike White basically said, “sure it might save based on some synergies, but that is a long way from actually even discussing such.” Large hurdles to cross. Plus the effect of a new anti-monopoly chief in the FCC(?) I did not hear anything that indicated Mike White was pursuing any form of merger talks.
In listening to the replay, Mike mentioned that some ownership in RSN gives them a great insight into their operation and costs for strategic advantage while in negotiations.
“In some areas of the country, RSNs are $4-5 of the bill…in some more metropolitan areas it can be as much as $18-20.” Might try some very “laser focused, geographically” cost surcharges for RSNs if needed. They are watching how the market is playing out as one competitor is already doing some surcharging in areas.