DIRECTV 2011 Annual Report Download - page 88

Download and view the complete annual report

Please find page 88 of the 2011 DIRECTV annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 152

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152

DIRECTV
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 1: Description of Business Liberty Transaction
DIRECTV, which we sometimes refer to as the company, we, or us, is a On November 19, 2009, The DIRECTV Group, Inc., or DIRECTV Group,
leading provider of digital television entertainment in the United States and Latin and Liberty Media Corporation, which we refer to as Liberty or Liberty Media,
America. We operate two direct-to-home, or DTH, operating segments: DIRECTV obtained stockholder approval of and closed a series of related transactions which
U.S. and DIRECTV Latin America, which are differentiated by their geographic we refer to collectively as the Liberty Transaction. The Liberty Transaction included
location and are engaged in acquiring, promoting, selling and distributing digital the split-off of certain of the assets of the Liberty Entertainment group into Liberty
entertainment programming via satellite to residential and commercial subscribers. Entertainment, Inc., or LEI, which was then split-off from Liberty. Following the
Since November 19, 2009, we also own and operate three regional sports networks split-off, DIRECTV Group and LEI merged with subsidiaries of DIRECTV. As a
and own a 60% interest in Game Show Network LLC, or GSN, a basic cable result of the Liberty Transaction, DIRECTV Group, which is comprised of the
television network dedicated to game-related programming and Internet interactive DIRECTV U.S. and DIRECTV Latin America businesses, and LEI, which held
game playing. We account for our investment in GSN using the equity method of Liberty’s 57% interest in DIRECTV Group, a 100% interest in three regional
accounting. sports television networks, a 65% interest in GSN, approximately $120 million in
cash and cash equivalents and approximately $2.1 billion of indebtedness and a
•DIRECTV U.S. DIRECTV Holdings LLC and its subsidiaries, which we related series of equity collars, became wholly-owned subsidiaries of DIRECTV.
refer to as DIRECTV U.S., is the largest provider of DTH digital television
services and the second largest provider in the multi-channel video DIRECTV Group has been treated as the acquiring corporation in the Liberty
programming distribution, or MVPD, industry in the United States. Transaction for accounting and financial reporting purposes and accordingly, the
historical financial statements of DIRECTV Group are reported as the historical
•DIRECTV Latin America. DIRECTV Latin America Holdings Inc. and its financial statements of DIRECTV in the accompanying Consolidated Financial
subsidiaries, or DIRECTV Latin America, is the leading provider of DTH Statements.
digital television services throughout Latin America. DIRECTV Latin
America is comprised of: PanAmericana, which provides services in See Note 4 for additional information regarding these transactions.
Argentina, Chile, Colombia, Ecuador, Venezuela, certain other countries in
the region, and the Caribbean, including Puerto Rico; our 93% owned Note 2: Basis of Presentation and Summary of Significant Accounting
subsidiary, Sky Brasil Servicos Ltda., which we refer to as Sky Brazil; and Policies
our 41% equity method investment in Innova, S. de R.L. de C.V., or Sky Principles of Consolidation
Mexico.
We present our accompanying financial statements on a consolidated basis and
•DIRECTV Sports Networks. DIRECTV Sports Networks LLC and its include our accounts and those of our domestic and foreign subsidiaries that we
subsidiaries, or DSN, is comprised primarily of three regional sports control through equity ownership or for which we are deemed to be the primary
television networks based in Seattle, Washington; Denver, Colorado and beneficiary, after elimination of intercompany accounts and transactions.
Pittsburgh, Pennsylvania, each of which operates under the brand name
ROOT SPORTS. The operating results of DSN are reported as part of the Use of Estimates in the Preparation of the Consolidated Financial Statements
‘‘Sports Networks, Eliminations and Other’’ operating segment.
We prepare our consolidated financial statements in conformity with
accounting principles generally accepted in the United States of America, which
requires us to make estimates and assumptions that affect amounts reported herein.
64