DIRECTV 2005 Annual Report Download - page 18

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THE DIRECTV GROUP, INC.
In addition, we hold licenses in three orbital slots (99 degrees west longitude, or WL, 101 WL,
and 103 WL) in the Ka-Band spectrum that DIRECTV U.S. will use primarily for the broadcast
of HD programming across the United States. We also have obtained approval from the FCC to
transmit our signal in the Ku-Band from one of our satellites that has been stationed at a leased
orbital location (72.5 WL) and from leased capacity on a satellite at 95 WL.
DIRECTV U.S.’ satellite-based service provides it with many advantages over ground-based
cable television services. DIRECTV U.S. has the ability to distribute hundreds of channels to
millions of recipients nationwide with minimal incremental infrastructure cost per additional
subscriber. In addition, DIRECTV U.S. has comprehensive coverage to areas with low
population density in the United States and the ability to quickly introduce new services to a
large number of subscribers.
•Association with a Leading Global Media Company. News Corporation, a leading global media
company, owned approximately 34% of our outstanding common stock as of December 31, 2005,
and has unrivaled experience in developing and managing successful pay-television platforms
around the world. We believe that our association with News Corporation will continue to
improve our competitive position and growth prospects.
Business Strategy
DIRECTV U.S.’ overall goal is to provide subscribers with the best television experience in the
United States. Its strategy focuses on offering its subscribers differentiated and exclusive content,
attaining leadership in technology, and enhancing its sales, marketing, distribution and customer
service.
•Offer Differentiated and Exclusive Content. To fulfill its goal, DIRECTV U.S. believes it must
have the most extensive collection of valuable programming services available. DIRECTV U.S.
plans on improving its programming service by expanding its HD programming, creating
compelling new programming, launching new interactive services and video-on-demand, or VOD,
and expanding its international programming.
•Expand High-Definition Programming. As of December 31, 2005, DIRECTV U.S. offered
local HD channels in 12 of the largest markets, ten national HD channels, network HD
programming from FOX, ABC, CBS and NBC in their owned and operated markets, as well
as several NFL games each week through its NFL SUNDAY TICKET package. As part of
its HD expansion plan, DIRECTV U.S. launched the first two of four new satellites in 2005,
SPACEWAY 1 and SPACEWAY 2. With these satellites, DIRECTV U.S. plans to offer local
HD programming to at least 36 markets in 2006, representing approximately 57% of U.S.
television households. The next two satellites, DIRECTV 10 and DIRECTV 11, are
expected to be launched in 2007. In total, these four new satellites will be capable of
broadcasting more than 1,500 local and 150 national HD channels to nearly all U.S.
television households. Subscribers receiving local HD channels will generally only receive
such channels in their home market.
•Create Compelling New Programming. DIRECTV U.S. believes that new programming will
differentiate it from the competition. Beginning in early 2006, DIRECTV debuted CD USA,
an exclusive program that delivers exciting back-to-back live music performances on
television. In addition, through Network LIVE, DIRECTV U.S. will provide its subscribers
with exclusive music and live entertainment programming. DIRECTV U.S. expects to
continue to create and launch new and exclusive programming in 2006 and beyond.
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