http://www.msnbc.msn.com/id/17419422/
Note that E* picked up 350,000 new subs in the 2006 Q4 vs D*'s 275,000.
This despite the loss of the distant nets, the TIVO lawsuits, and all of the associated stories that ran which seemingly showed E* in disarray.
With all of the grumbling about the distant nets, and conjecture here about how much that would hurt E*, I find it amazing that they actually went out and had a very successful quarter. There is nothing in these numbers to indicate that the distant nets problem hurt them very much.
Total net revenue is up 17% from a year ago, to 2.58 Billion in the quarter.
Not at all surprised with the growth: lower pricing, powerful word of mouth, incentives with the Club Dish, better 2-tuner DVR and 2-tuner HD DVR, overall, a lot of satisfied customers.
I am surprised to see the increase subs spend per month which has always been Wall Street's main problem with Dish. Also the cost of acquiring subs has decreased, although just a bit, bit it adds up to a fair amount of $$.
Let's not forget that the vast majority of people have no idea about the lawsuits (Direct and Cable have their own disputes in civil court) and loss of Distant Networks. It's all industry news (and interesting news to us on the boards), and most people really don't care. All sorts of larger more well-known companies are in court suing or being sued. The consumers just don't care. What they care about are the prices, reliability of service, quality of customer service, and DVR--once they get one. Ergan, whether you like him or not, has been a record breaker in adding subs for years, and he continues to do it despite being massively outspent by Direct TV's VERY expensive to produce and VERY expensive to air commercials. Even the stars in the Direct TV ads can't seem to help.
My main concern would be about Direct's huge advertising expenses compared to Ergan's superior growth rate
with the increase in spending by subs
and the slight decline in churn rate. Yes, Direct targets the high end consumer, but big, low-cost retailers RULE.
Every business journal and business columnist have been predicting satellite's
immediate demise every 6 months for at least the last 5 years. Now this news from Echostar. It affirms that regardless of "triple play" people want a, quality service that meets their modest needs and modest budget, but can still provide a great DVR product while offering decent upgrades and who treat the customer, most of the time, fairly well. IMHO.
The really unbeliveable sub increase in a quarter was Direct TV's the very same quarter that Rupert Murdoch acquired Direct (I forget the exact number, but I believe it was close to 500,000). Hmmmm? It certainly helped the stock price in the short term. Even Ergan referred to it as a "phenomenal number." We haven't seen such a number even approaching that from Direct since.
Let's face it: Ergan is the better CEO of satellite.
