Retailer Chat Recap 12/12/13

[MikeD-C05]

We have used magic jack for the last three years now . I pay a $20.00 renewal fee once a year in january to keep it going each year. I only really need it for my 13 year old to be able to talk to him after school while I am at work. I refuse to let him have a cell phone till he has his own job and can pay for it himself.

 

[harshness]

The next satellite launch is Echostar 18 which will be in 2 years.

Odd that they're replacing Echostar 10 half way through its projected life.

 

[harshness]

While I am not sure about this I think Direct has phased free HD?

DIRECTV offered FHDFL for just one marketing cycle.

To appeal to value-minded customers, they want to know that they're paying only for what they get. It costs considerably more to deliver HD than it does SD and SD customers want to know that they're not heavily subsidizing the cost of HD service that they choose not to avail themselves of.

 

[harshness]

After the price increases in Jan/Feb, and the extra $10 HD fee, expect a stagnation of new customer signups.

With any luck, they'll make it look like they adjusted their package pricing accordingly.

 

[harshness]

These are determined by Nielsen (or some 3rd-party organization), right ? Just curious... Directv, for example, would have the same change to implement ?

Current DMA boundaries are determined by Nielsen but, IIRC, the provider gets to choose from the last few (five?) years worth of boundaries. It isn't like they can deftly rearrange their spot beam coverage every time the boundaries shift.

 

[Mojo Jojo]

We put our account on pause when I was unemployed this summer. We were seriously thinking about cutting the cord, but my wife "needs" Hallmark (especially with all of the Christmas movies out now) and HGTV and, IMO anyway, cable dramas are far superior to what the "Big 4" ota networks offer. After I found a job this fall, we decided to sign up with our internet/phone provider instead of keeping Dish. Since I have my own equipment (3 Tivos, only one was bought new, and a HTPC w/2 Xbox 360 extenders), I was able to save $30 on the package I got compared to AT120 plus Heartland w/722K. And I now cover all 4 of our sets (plus laptops) with independent tuners instead of just 2 tv's. Channel-wise, the package fits between At120 and AT200. But the cableco will be raising rates in Jan and we were thinking about going back to Dish to get promo pricing again. We'll see how it goes. My next step to save money will be dropping the landline since everyone has a cell phone.

Hallmark SD and HGTV SD are in the $19.99/month Welcome Pack.

 

[harshness]

For switchers like me, it doesn't matter. And for those that don't switch often, Dish will still generally be a little cheaper.

DISH is generally a LOT cheaper. DIRECTV's ARPU was $102 for Q3 while DISH's was $81.05.

But there are other issues for switchers that are making it harder. As we've become accustomed to having this more advanced gear, switching generally involves more upfront money than in the past.

Switching from DISH also involves forfeiting archived content; a "service" that DIRECTV doesn't offer.

For instance, to switch from E* to D* for me would mean swapping out 2 Hoppers, which means to get even a little close to what I have now I would have to pony up $199 for an additional HR, or ideally a 2nd Genie.

But of course DIRECTV doesn't allow a second Genie.

 

[mike123abc]

DISH is generally a LOT cheaper. DIRECTV's ARPU was $102 for Q3 while DISH's was $81.05.

Or perhaps Dish attracts more bargain hunters and DIRECTV appeals to high end clients?

 

[lparsons21]

Or perhaps Dish attracts more bargain hunters and DIRECTV appeals to high end clients?

Other than the additional cost sports that D* offers which will skew the ARPU a bit, I doubt that D* has any more 'high end' customers than E*.

For me with essentially the 'Everything' or 'Premier' package level with 2 DVRs, the price is within a buck of each other.

 

[harshness]

I am still wondering why Dish still offers the SD channels!

Because there's still a large base of installations that aren't already HD across the board. It isn't a switch that you can flip without a huge investment in both time and replacing receiving equipment.

I think DISH made a pretty wise decision by adding the Eastern arc as it allows them to upgrade a fraction of the customers without necessarily forcing many to change over when they're not actively interested in doing so.

 

[lparsons21]

DISH is generally a LOT cheaper. DIRECTV's ARPU was $102 for Q3 while DISH's was $81.05.
Switching from DISH also involves forfeiting archived content; a "service" that DIRECTV doesn't offer.
But of course DIRECTV doesn't allow a second Genie.

While ARPU is an important number for investors, it has little value to the subscriber. The subscriber just needs to know the difference at the level of sub they will use.

And that archiving feature of E*'s certainly has perceived value by my, it wouldn't always be such a big deal to most I suspect. Of all my friends that have Dish, I'm the only one with an EHD attached.

Yep, D* doesn't yet allow for a 2nd Genie which to me is a downside.

But I have hopes my adult son, with his new love interest, will be moving out fairly soon and I'll be down to a single HDDVR.

 

[harshness]

I am tired of getting nickeled and dimed with all the fees and constant price increase.

Define "constant price increases" and contrast that with some context about how it isn't happening pretty much everywhere else.

Whatever you have to tell yourself, you shouldn't lie to yourself.

 

[harshness]

Not quite right Nelson. Color phones were a one time charge of $5.00 each. Now, if you wanted a Princess or Trimline there was a $.75 to $1.25 monthly charge.....

The real killer was when they were charging fifty cents for touch-tone service and they had to go through hoops to deny those who didn't pay for the service.

 

[harshness]

Cable companies do not charge for HD (well they charge more for HD boxes vs SD ones).

I submit that you contradicted yourself. We know that HD boxes don't cost substantially more than SD boxes.

 

[harshness]

Or perhaps Dish attracts more bargain hunters and DIRECTV appeals to high end clients?

In many cases.

In other cases, they just don't know any better or are averse to change. Inertia makes otherwise smart people look pretty stupid sometimes.

 

[harshness]

While ARPU is an important number for investors, it has little value to the subscriber.

It is a simple metric (unless you're DIRECTV that doesn't seem to be able to conform to GAAP).

If your fellow subscribers are generally paying more than you're willing to spend, what do they know that you don't?

 

[lparsons21]

It is a simple metric (unless you're DIRECTV that doesn't seem to be able to conform to GAAP).

If your fellow subscribers are generally paying more than you're willing to spend, what do they know that you don't?

If they are spending more than I am for the same service from the same provider, then they don't know as much as I do.

OTOH, if they are spending more than I am willing to, then I can hope that they are getting what they perceive as value for their dollars.

ARPU is just a nice number to tell the investors because it shows the average return. For the customer it is just a number on a piece of paper that has no bearing at all.

 

[mike123abc]

I submit that you contradicted yourself. We know that HD boxes don't cost substantially more than SD boxes.

True, but they tend to charge a small amount for cable card which lets you put in your own HD equipment.

 

[dare2be]

True, but they tend to charge a small amount for cable card which lets you put in your own HD equipment.

Which was mandated by the FCC. Too bad there isn't an option to do the same with satellite providers.

 

[Scott Greczkowski]

True, but they tend to charge a small amount for cable card which lets you put in your own HD equipment.

Cablecards here are now $12.95 a month. I have one at my office and use it with MythBuntu and a HD Homerun Prime. Works rather well!