The DIRECTV Group, Inc. Q1 2009 Earnings Call Transcript

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2009-05-07 16:33:16.0

Tags: DirecTV Group Inc., Call Transcript, Quarter, Earnings, ARPU, Sales Strategy, Corporate Communications, Sales, Marketing, Seeking Alpha

Question-and-Answer Session

Operator

(Operator Instructions). We'll take our first question from Benjamin Swinburne with Morgan Stanley.

Benjamin Swinburne - Morgan Stanley

Wanted to ask about subscriber trends and ARPU, as you moved into the second quarter I realize we're getting sort of from a timing perspective, getting now into weekly pacing's. But you've made some changes I think to your offers in the marketplace. I think you sound like you've intentionally dialed back some of the subscriber growth.

Any sense after a month of the quarter where you think ARPU may shake out in Q2? Maybe your gross adds strength, and if you want to comment on that front as well? Then I wanted to ask Pat, if you strip the ad sales declines out of the first quarter, maybe give us a sense of what maybe true video ARPU was? How material that might have been as a piece of the pie? Thanks.

Pat Doyle

Yeah, I guess really not going to get too granular on sort of second quarter numbers, I'll probably comment more sort of directionally. We did in March reduce the discount, also toughen up some other term increase that's commitment period and as we continue to do. I think as we said, I think we are by design, and you're right, probably while we still need the growth opportunity, I think opportunity to take share, I think we do want a bit more balance and we'll look to that.

I think we still look for subscriber growth going forward to be positive. Again, not like it was in the first quarter. The first quarter from an ARPU perspective, the first quarter was always our toughest quarter and it got better as you went to the second and the second half and that certainly is still true.

Clearly to the degree we've made some moves that particularly on I guess the two areas that I think we control more directly is certainly the credits and offers which we've tightened up a bit on and probably a bit more focused on the premium sales. That will take a little time to get some traction because it doesn't kick in right away. I think those things will help in ARPU. I think ARPU always had a trend to it that was weighted towards the back-end.

Again, you go back to what we had said early on, I think said last call that really with the second quarter of '08 that we increased due to competitive and economic issues, our offers and credits and therefore you sort of had this tune as you went through the year into the first quarter. You look at the amount, obviously credits and offers are hit on ARPU.

 

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