Directv to shift away from Satellite?
- Thread starter Scott Greczkowski
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Spectrum customers still have signal, DIRECTV doesn’t but other locals are still working. So does that 100% mean it’s OTA or fiber, no but it’s a fairly good indicator.
Do not ignore the inherent efficiency of sending a signal to millions of homes over sending millions of signals to homes.
ATT's original plan when they started all this was to sell it off eventually ....
They have to launch more satellites...that's the kicker
Sent from my SM-G950U using the SatelliteGuys app!
Could they sell of just the DTV satellites and not contract with the satelliteTV equipment manufactures but keep the DTV name? Or just sell of everything and go with AT&T TV? The only reason to keep DTV over SatelliteTV would be to use it in the rural areas unless they plan on using 5g in the rural areas for DTV OTT?
When Directv is collecting $128 per customer on average (that's their reported APRU for satellite) 50 cents is a drop in the bucket. It isn't as if streaming delivery is free, it costs them many millions of dollars. The point is, if the cost difference between IP and satellite delivery became "too large" they could add a surcharge for satellite. If someone lived where satellite was the only option, or where rain was almost never a problem, or where they had unreliable or capped internet, they probably wouldn't complain too much if they was a "satellite fee" of a buck or two added on when the number of satellite subscribers fell too far and that 50 cents became larger.
However, if they are planning to offer the new service for $80 to $90, which is a lot less than $128, that 50 cents is irrelevant if they are making less money per customer for IP delivery. That's why I think people who believe Directv is going to try to push people off satellite are nuts - why would they want to switch a customer to a service that makes them less money? They'll convert ones who want to convert, but they aren't going to go out of their way to make it happen. The lower installation costs from not having a truck roll, less equipment (presumably no Genie and cloud DVR) only save them money on new installs, not existing customers. So if/when they calculate signing up new customers on IP will make them more money when everything is figured in, they'll encourage new signups on IP - sort of like they encourage people in AT&T areas to get Directv and not Uverse TV because the content costs for Uverse TV are (or at least were when AT&T bought them) $14/month/customer higher due to worse contracts.
You still are underestimating the cost of Satellites, receivers rolling trucks etc. It isn't just for new installs that is just the more expensive side of it. Existing still needs service, reconditioning at the very least of receivers to replace receivers, rolling for repairs etc. But the big thing you are overlooking is technological advancements. Either Directv is - or is not - going to keep producing or obtaining new receivers. If not they are signalling the end of their use for Satellite TV unless they want to try having someone like TIVO be the source. Either way there is still a cost of doing business involving receivers..New subscribers will need them and expect newer technology as time goes on..
If they intend to keep customers they will be required to keep up technologically and the only way to do that is keep making receivers (or buy them/lease them from a manufacturer) and not just for new accounts, many want the newer equipment when there are advancements.
OTT or eventually wireless will give companies the ability to charge less thus the potential to keep customers or keep them longer, and potentially make as much or more profit.
I do not agree with you that At&t thinks somewhere around 1 million a year, (using your figures again I don't know that is correct) ten million over ten years etc just for satellites is a drop in the bucket when they have the means to provide TV other ways with much less cost outlay.
Remember I don't think At&t planned for getting out of the satellite service soon, the question is if pushed to make a decision as they may now be is Satellite more important than owning content.
The current hardware can't cost them much to make. Probably less than $200 for the HS17, and clients are definitely under $50. The main things that break in DVRs historically have been power supplies (so now they are external) fans (now they don't have them) and hard drives (not much you can do about that)
Sure, they will keep producing receivers. And keep charging people $7/month for each TV - that's $84/yr or $420 over five years. Five years is the depreciable life they use for their receivers, so the receivers are MORE than paid for by the fees they collect even if you just have HS17 + one client, with a little extra left over for refurbishment if a customer leaves - and the more TVs you have the more profitable those TV fees become, adding $420 in revenue for $50 of cost! Probably the only repair they do now is replacing a failed hard drive - if the electronics fail on an HS17 (let alone a client) it isn't feasible to repair, so if it won't work with a known good power supply and hard drive they'll just recycle it.
People might "want" new equipment, but Directv has historically not handed it out just because something new was available - when the HR44 came out, they didn't let people upgrade to it from the HR34, there are still people with HR21s, and so on. But newer equipment doesn't make much difference now - HS17s and C61s are pretty fast, while newer servers might support more 4K TVs at once, and newer 4K clients might support 4Kp120 eventually there isn't much "new technology" that's coming. If they didn't upgrade customers just because they wanted it back when HR21s totally sucked, they sure aren't going to do it today.
It will be interesting to see how the pricing for the IP delivered version of 'full' Directv will work. Will they still charge you $7/month per TV, charge by stream, or will they try to get rid of the separate fees and simplify pricing? They will still be providing equipment to these customers, so if you think providing equipment is expensive they aren't getting away from that cost (except for the 'server' unit) by switching to IP delivery.
Which is why I believe traditional cable and satellite will be going nowhere, too many things IP will never match
Even people who have a dozen TVs at home aren't likely to watch all of them at once, so bandwidth concerns for IP shouldn't be an issue for most residential customers (total usage for the month might be though, depending on your ISP) Recording won't require any bandwidth as all evidence points to the IPTV version of 'full Directv' using cloud DVR, instead you'll use bandwidth when watching the recording.
I'm becoming more worried about the downsides of cloud DVR - supposedly when they recently had a dispute with a group of local stations they not only pulled those stations off Directv Now but deleted existing recordings from those stations! It would also be easier for providers to prevent FF through commercials on a cloud DVR. While theoretically they could do the same with a real DVR, that seems less likely since people are used to how a physical DVR "should work" and would switch providers if anyone tried that trick.
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