DIRECTV 2011 Annual Report Download - page 36

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DIRECTV
billing systems. We will also continue leveraging best practices from from leased transponders on a separate satellite. In addition, we lease a backup
DIRECTV U.S. We expect initiatives like these to enhance operations across satellite that serves Sky Brazil and Sky Mexico.
the various countries and regions where we offer service under the We have entered into a contract for the lease of two satellites for
DIRECTV and SKY brands. PanAmericana: ISDLA-1, which we expect to launch in the fourth quarter of 2014,
•Leverage Brand and Customer Base to Introduce Complementary and ISDLA-2, which we expect to launch in the fourth quarter of 2015. ISDLA-1
Services. To expand our leadership in particular markets we are testing will become the primary satellite for PanAmericana with a substantial increase in
potential growth opportunities that could optimize the profitability of our channel capacity from the current satellite, and ISDLA-2 is expected to serve as an
subscriber base, minimize churn and extend the value of our brand. We will in-orbit spare for ISDLA-1.
further explore (1) offering a fixed wireless broadband service and Our principal digital broadcast centers are located in the United States and
(2) extending our presence by establishing an over-the-top, or OTT Brazil. We also have several smaller satellite uplink facilities in the region.
distribution platform.
We typically have customer service centers in each of the countries where we
•Offer Fixed Wireless Broadband. Connecting our customers to a operate. In addition, we operate two pan-regional centers located in Colombia that
broadband service is strategically important because we expect it will provide primary and backup customer service support to most of the PanAmericana
minimize churn and attract new subscribers. We are focused on region.
selectively pursuing opportunities to acquire spectrum and, were we to
do so, on introducing fixed wireless broadband in areas where our Competition
existing subscriber base has a weak wireline offering or access to
broadband is nonexistent. In 2010, we launched a test of fixed wireless The pay television and other emerging broadband video and data markets in
service in Mendoza, Argentina. In addition, during 2011, we deployed Latin America are highly competitive. In each of our markets, we compete primarily
a fixed wireless service in Brasilia, the capital of Brazil, and provided a with other providers of pay television, which distribute their programming by
bundle option with our SKY video service. In the future, we plan on satellite, cable, terrestrial microwave systems, traditional over-the-air broadcasting or
expanding our fixed wireless service to several new cities in Brazil with the Internet. In addition, in certain markets we face significant competition from
similar bundling capabilities. illegal and informal sector pay television operations. We compete primarily on the
basis of programming selection, price, technology and service.
•Establish OTT Distribution Platform. Extending our premium video
experience to our customers who desire content that can be accessed In most of the markets in which we operate, cable television is our principal
on demand is strategically important as the penetration of pay competitor. Cable operators typically offer analog services for lower monthly fees
television households with Internet access increases across the region. and with lower upfront installation and connection fees than we offer. In addition,
Given the strength of our brands, the scale of our subscriber base and the cable operators with which we compete are in various stages of upgrading their
our strong relationships with programmers and distributors, in the networks in order to provide broadband and telephony services, and in some
future, we believe we can complement our traditional video markets the major cable operators are competing with us based principally on their
subscription service by establishing a premium OTT distribution offer of a ‘‘triple play’’ bundle of video, broadband and telephony services. In most
platform in the region. cases, they discount the value of their programming services in order to sell
broadband and telephony services.
Infrastructure In addition to competition from cable services, we face increasing competition
We currently provide services in PanAmericana and Brazil from leased from other providers of DTH services. Telefonica, the Spanish telephone company,
transponders on two geosynchronous satellites. Sky Mexico provides its services provides DTH services in Peru, Chile, Brazil, Colombia and Venezuela. Telmex
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