DirecTV HD DVR Delayed Again

[Scott Greczkowski]

DirecTV HD DVR Delayed Again

Courtesy Multichannel News
http://www.multichannel.com/index.asp?layout=articlePrint&articleid=CA6355813
--------------------------------------------------------------------------------

By Linda Moss 7/24/2006 5:06:00 PMDirecTV once again delayed the rollout of its new HD digital-video recorders, which could make impatient subscribers switch over to competitors EchoStar Communications or cable, a Wall Street analyst said Monday.

In a report, Sanford C. Bernstein analyst Craig Moffett wrote that DirecTV’s churn rates could rise because of yet another postponement of the deployment of its state-of-the-art dual-tuner HD DVRs.

“There is obviously a limit to how long customers -- who, after all, have just spent large amounts of money on a flat-panel HDTV -- will be willing to wait for an upgrade from DirecTV before they simply switch to a competitor instead,” Moffett wrote. “EchoStar and cable operators could benefit.”

Moffett cited a letter that DirecTV is sending to customers on a wait list for the HD DVRs. The direct-broadcast satellite provider said the new HD DVRs -- originally expected early this year, then pushed back until spring -- are now set to be available this fall. He blamed the delay on a lack of product inventory.

“We believe shortages of the combination HD DVR unit have contributed to DirecTV falling behind cable competitors in HD readiness,” Moffett wrote. “HDTV penetration of digital subscribers among cable operators appears significantly higher than at DirecTV.”

But in what he calls “the bizarre calculus that is the DBS industry,” Moffett said the glitches in getting the new DVRs to subscribers in some ways will help DirecTV’s bottom line in the short term, since the upgrade involves “significant” costs to the company.

“More delays for the HR20 should translate into better near-term financial results, since upgrades are a key driver of retention-marketing expense [and capital expenditures such as upgrade equipment are now capitalized under their new leasing plan],” Moffett wrote. “Lower retention marketing means higher EBITDA [earnings before interest, taxes, debt and amortization] and higher earnings … But we’re skeptical that investors will continue to give DirecTV a free pass, however, as the future upgrade requirement is clearly growing.”

The analyst also made reference to a plan announced last week by News Corp.’s British Sky Broadcasting to provide free broadband service to its subscribers in Great Britain. News Corp. owns 38% of DirecTV, which doesn’t have a broadband offering yet.

“News Corp.’s willingness to slash cash flows at BSkyB would appear to raise the risk of an unwelcome surprise in capital spending related to plans for a terrestrial broadband network at DirecTV, as well,” Moffett wrote. “Even if the business were to be built off-balance-sheet, subscriber-acquisition costs associated with the broadband venture could directly and significantly impact DirecTV’s cash flows.

A Federal Communications Commission auction for the so-called AWS (advanced wireless services) spectrum begins in a several weeks, he noted.

 

[Neutron]

If E* can get theirs out, what is taking D* so long to release theirs??

 

[FlyingJ]

Something we all new. I ask the question, If the doctor tells you your baby is expected on June 10, then later tells you more like June 20. Next appointment a month later another doctor says June 20. Was it "delayed again" Point is I saw an article in the local paper here yesterday on the upcoming release of the first Blu-Ray and HD DVRs, with this tech stuff most that are interested would consider it old or no news. Admit it you all just loved the baby analogy!

 

[minorthr]

This is getting ridiculous. If the series 3 tivo or comcast tivo beats this thing to market then I guess i have to consider ditching D* especially if the distant HD locals gets shut off.

 

[bonscott87]

Uhhhh, this *isn't new news*. We've known it was due to be out in the fall 6 months ago.

 

[beast37799]

maybe there trying to mkae sure the hddvr actually works and not riddled with bugs

 

[ScoBuck]

Truth be known - fall starts in September! I know of at least 2 reliable sources that believe that September is very realistic for launch.

But - way too much gloom and doom. The overwhelming majority of subs DO NOT read these boards, have no real idea about any of this, and don't change providers often or without something happening almost forcing them to change.

Yes, members from here (and some other boards) may make a change in the near term, but those numbers combined are but a pimple on a CSR's A** in the big scheme of things - and will have little or no effect IMO.

Bwah! I say Bwah!

 

[Brewer4]

http://www.tvpredictions.com/directvhddvr072506.htm

News & Commentary
DIRECTV: The HDTV 'Misleader'
Once again, the satcaster pushes back the launch of its new High-Definition DVR.
By Phillip Swann

Washington, D.C. (July 25, 2006) -- DIRECTV has once again delayed the launch of its new High-Definition TV DVR. But this time, a Wall Street analyst says it could force high-def owners to sign up for another service.

And that could hurt the satcaster's subscription growth and stock price.

"We're skeptical investors will continue to give DIRECTV a free pass," Sanford C. Bernstein analyst Craig Moffett said yesterday in a note to investors.

DIRECTV says the HD Digital Video Recorder now won't be available until the Fall.

The satcaster initially said the HD DVR would be available in the spring of this year. But it changed that to the summer; then the end of the summer; now it's the "Fall."

Moffett said HDTV owners may not be willing to wait for DIRECTV to release the high-def recorder -- and expand its HD lineup. DIRECTV now offers fewer than 10 national HDTV channels while rival EchoStar provides 29.

"Product shortages will only delay the inevitable, in our view," said Moffett, suggesting that DIRECTV may start losing subscribers to EchoStar and cable operators who now offer more high-def channels and services.

DIRECTV last year made headlines by announcing that it would launch four new satellites over two years that would enable it to provide 150 national HD channels -- and local HD channels in most markets -- by 2007. But thus far, DIRECTV's primary focus has been on adding the local high-def channels. The satcaster has added just two national HD channels in the last year -- ESPN 2 HD and TNT HD.

Swanni Sez:
Moffett is correct that DIRECTV's HDTV customers are getting impatient. Many cable operators now offer twice as many HD channels as DIRECTV -- and a high-def Digital Video Recorder. And EchoStar has approximately three times as many national HDTV channels, plus the HD recorder.

If DIRECTV doesn't expand its national HD lineup soon, it will lose current subs -- and it will lose future subs in the growing HDTV audience.

The HDTV delays are inexcusable and more evidence that DIRECTV's management does not truly appreciate the needs of the high-def audience. David Hill, DIRECTV's president of entertainment, once said that he didn't understand why everyone is excited about HDTV. It appears that Mr. Hill's sentiments are shared by some of his colleagues.

While DIRECTV is investing heavily in new satellites for the future, there's no sense of urgency in providing its current HDTV customers with better service.

(I will give DIRECTV credit for rolling out local HD channels in dozens of markets this year, but cable TV operators have offered local HD for a few years now. You expect DIRECTV to offer something better than cable.)

Several years ago, when U.S. stores first began selling high-def sets, DIRECTV was quick to add a few HD channels so early adopters would have something to watch.

Consequently, at the time, DIRECTV was considered the "HDTV Leader."

But now, DIRECTV has become the "HDTV Misleader."

It's time for DIRECTV to stop making promises and start delivering new services.

To learn more, click DIRECTV

And click TVPredictions.com to see the rest of today's Swanni Sez.

© TVPredictions.com

 

[herdfan]

The overwhelming majority of subs DO NOT read these boards, have no real idea about any of this, and don't change providers often or without something happening almost forcing them to change.

But let's look at a D* HD sub. He had an HR10-250, and was able to pick up some HD locals with an antenna. D*'s announces that they are rolling out HD LIL's. He should know this even if he doesn't read the boards. So he signs up and gets an H20.

Wait a minute. "I can't record these", he says. So he starts looking around, at the insistance of his wife , and finds that both his cableco and E* offer recordable locals. So he calls D* and is told by a clueless CSR "Summer 06". Summer '06 is now here and he still can't record locals, but the new fall season is coming.

So to make his wife happy, he goes to cable and is able to record his locals in HD.

It is a bigger deal that D* would want you to know.

 

[Brewer4]

Good point herdfan. Dont underestimate the power of a non-technical wife in the decision making process. I get my HD locals via antenna and it was hard work. My wife doesnt care not even about HD as long as she can record and ONLY WITH A TIVO. I think its a bigger mistake making the D* standard DVR's non-Tivo. I tried to get my wife to use Windows Media Center and she wants nothing to do with it. Give her Tivo or else.

Now she would come to the same conclusion as herdfan stated. If cable and E* can do it, why are with D* again? Especially when locals are 70% of what we watch. Look out when the cable card HD Tivo Series 3 comes out. There is some serious brand loyalty with Tivo and a good deal of them are female head of household decision makers.

 

[Proc]

Hopefully the delay will result in a quality, non-buggy product.

I'm content to wait and use my SD RCA40 Tivo to record stuff until the HD DVR is ready and use my H20 to watch HD programming.

As for switching to cable...no NFLST, no cable for this guy.

Scott, thanks for the news update.

 

[Neutron]

Well, delay after delay after delay plus the attitude of no new HD channels until late next year made me switch. Heck, the wife even insisted.

 

[Sapient]

I suspect this will hurt D*'s ability to pull subscribers from their competitors. I'm upgrading to HD this week. I'm currently an E* customer, but I checked out all my options before locking in again with Dish. It is hard for me to imagine many new HD customers choosing D* at this time.

I don't know if many people will leave D* over this issue, but growing their HD subscriber base may be difficult.

 

[landlocked]

I'm a firm believe that Murdoch should have purchased TiVo when the stock was tumbling. They would have picked up the know how AND have the brand name.

TiVO is now a verb, for god's sake!

 

[Brewer4]

Another good point Sapient. If you do a side by side comparison of HD and your options, a good deal of new HD subscribers would not move to D* unless NFL Sunday Ticket in HD was the primary decider.

I am sticking it out because HD Tivos with OTA rule, my cable co does not have HDNet yet, cable cards for Tivo and Windows Media Center are not ready yet, and Dish network's HD DVR only does one OTA tuner.

 

[tds4182]

http://www.tvpredictions.com/directvhddvr072506.htm

News & Commentary
DIRECTV: The HDTV 'Misleader'
Once again, the satcaster pushes back the launch of its new High-Definition DVR.
By Phillip Swann

Washington, D.C. (July 25, 2006) -- DIRECTV has once again delayed the launch of its new High-Definition TV DVR. But this time, a Wall Street analyst says it could force high-def owners to sign up for another service.

And that could hurt the satcaster's subscription growth and stock price.

"We're skeptical investors will continue to give DIRECTV a free pass," Sanford C. Bernstein analyst Craig Moffett said yesterday in a note to investors.

DIRECTV says the HD Digital Video Recorder now won't be available until the Fall.

The satcaster initially said the HD DVR would be available in the spring of this year. But it changed that to the summer; then the end of the summer; now it's the "Fall."

Moffett said HDTV owners may not be willing to wait for DIRECTV to release the high-def recorder -- and expand its HD lineup. DIRECTV now offers fewer than 10 national HDTV channels while rival EchoStar provides 29.

"Product shortages will only delay the inevitable, in our view," said Moffett, suggesting that DIRECTV may start losing subscribers to EchoStar and cable operators who now offer more high-def channels and services.

DIRECTV last year made headlines by announcing that it would launch four new satellites over two years that would enable it to provide 150 national HD channels -- and local HD channels in most markets -- by 2007. But thus far, DIRECTV's primary focus has been on adding the local high-def channels. The satcaster has added just two national HD channels in the last year -- ESPN 2 HD and TNT HD.

Swanni Sez:
Moffett is correct that DIRECTV's HDTV customers are getting impatient. Many cable operators now offer twice as many HD channels as DIRECTV -- and a high-def Digital Video Recorder. And EchoStar has approximately three times as many national HDTV channels, plus the HD recorder.

If DIRECTV doesn't expand its national HD lineup soon, it will lose current subs -- and it will lose future subs in the growing HDTV audience.

The HDTV delays are inexcusable and more evidence that DIRECTV's management does not truly appreciate the needs of the high-def audience. David Hill, DIRECTV's president of entertainment, once said that he didn't understand why everyone is excited about HDTV. It appears that Mr. Hill's sentiments are shared by some of his colleagues.

While DIRECTV is investing heavily in new satellites for the future, there's no sense of urgency in providing its current HDTV customers with better service.

(I will give DIRECTV credit for rolling out local HD channels in dozens of markets this year, but cable TV operators have offered local HD for a few years now. You expect DIRECTV to offer something better than cable.)

Several years ago, when U.S. stores first began selling high-def sets, DIRECTV was quick to add a few HD channels so early adopters would have something to watch.

Consequently, at the time, DIRECTV was considered the "HDTV Leader."

But now, DIRECTV has become the "HDTV Misleader."

It's time for DIRECTV to stop making promises and start delivering new services.

To learn more, click DIRECTV

And click TVPredictions.com to see the rest of today's Swanni Sez.

© TVPredictions.com

Somebody please correct me if I'm wrong on this, but doesn't Swann have the reputation of having been wrong in his predictions fairly often in the past and isn't he well known for being of "the sky is falling" mentality?

Ebonic and others with good sources report that there is no delay beyond what had been announced months ago and that the HR20 is scheduled to be released sometime this fall.

 

[mikew]

Dish network's HD DVR only does one OTA tuner.

For those of us using OTA to record HD locals, this is a big issue. Tucson won't see HD locals on sat for sometime. Our cable company (Cox) doesn't carry FOX, NBC or ABC (carriage disputes). For me...the only way to go right now is HD-Tivo.

 

[Brewer4]

Somebody please correct me if I'm wrong on this, but doesn't Swann have the reputation of having been wrong in his predictions fairly often in the past and isn't he well known for being of "the sky is falling" mentality?

Ebonic and others with good sources report that there is no delay beyond what had been announced months ago and that the HR20 is scheduled to be released sometime this fall.

Not really. He does miss points a good deal of times and I am not here to defend him. He does tick a few people off. I think the point of some of the articles is that they are Wall Street type ones and not forum posts. Of course we knew long before the articles but the articles are more public mention and not good for PR. And folks other then forum readers and early adopters are taking notice.

 

[Brewer4]

For those of us using OTA to record HD locals, this is a big issue. Tucson won't see HD locals on sat for sometime. Our cable company (Cox) doesn't carry FOX, NBC or ABC (carriage disputes). For me...the only way to go right now is HD-Tivo.

Series 3 cable card ready Tivo will give you another option too! I found it strange that Dish cut a corner with only one OTA tuner. When I used them I found the 942 and vip622 to be good units despite the OTA one tuner flaw. But local networks in HD via OTA rule in our house.

 

[packfan909]

An Ironwood Communications local manager mentioned this last week on a technical call with D* Corporate. They are quoting him an Oct 3rd roll out. What was really interesting is that he mentioned people in the SF Bay Area are piloting the new DVR's today. Can anyone confirm this or as with most people "officially" tied to D* just blowing more smoke up our rears.

packfan909