UPDATE: DirecTV CFO: Sees Telco Video Adds Flattening
September 10 2009 - 5:59PM
Dow Jones News
The telecommunications providers' initial high rate of new video
customers is starting to flatten, according to DirecTV Group Inc.
(DTV) Chief Financial Officer Patrick Doyle.
After an early spike in the months after their launch there has
been a stabilizing of net new subscriber additions, Doyle told
analysts during an investor conference Thursday.
Verizon Communications Inc. (VZ) sells television service
through FiOS, while AT&T Inc. (T) offers its U-Verse TV
service.
Both companies, however, partner with DirecTV to provide
television service. Doyle said the companies continue to line up
well in competition against the cable providers.
On the company's ongoing chief executive search, Doyle said he
doesn't expect an announcement for a while. While some progress is
made, the board will take its time finding the right candidate, he
said.
Despite concern over younger consumers getting away from
watching video on their TVs, Doyle said customers are still
spending more time in front of the television set than the Internet
or a cellphone.
DirecTV has done a good job of maintaining a high bar for
quality customers, Doyle said. The company has used credit checks
to ensure it is keeping out customers unwilling to pay for the
service once the promotional periods end. Likewise, the company is
attracting higher-end customers with more advanced services, which
he says makes these customers "stickier."
DirecTV is working on reducing costs, and expects the growth in
operating expenses to slow below revenue growth, Doyle said. The
company is looking to get more efficiencies out of customer care
and tighter general expenses, as well as lower set-top box
prices.
Doyle said he expects higher average revenue per customer next
year, once several "revenue headwinds are removed."
DirecTV shares closed up 50 cents, or 2%, to $25.52.
-By Roger Cheng, Dow Jones Newswires; 212-416-2153;
roger.cheng@dowjones.com