DIRECTV 2012 Annual Report Download - page 15

a team of talented, experienced executives adept at seizing opportunities
and managing risk, plus more than a decade of superior customer service
compared to our cable and Telco competitors, and it’s clear that DIRECTV
has a lot to offer consumers on every level.
We see a bright future for our Latin American business and remain
committed to the strategies we outlined at our Investor Day in March of
last year: We expect to profitably increase market share across the region
by strengthening our penetration of advanced services for premium
customers, leveraging scale to further penetrate and profitably serve
the middle market, building a world-class infrastructure to enhance
productivity and effectively manage costs, and selectively expanding
our fixed wireless broadband service.
STRENGTHENING OUR SHARE OF PREMIUM CUSTOMERS
We believe our competitive advantages and operating strengths will continue
to drive market share gains throughout the region. The DIRECTV and SKY
brands are positioned as the leader in video entertainment, offering the best
quality content, picture, sound, technology, and customer service available.
We will build on our industry-leading service performance by leveraging our
U.S. technology road map to reinforce and maintain product leadership in the
higher-end households across the markets we serve, with a particular
emphasis on HD and DVR excellence.
These advantages are particularly evident when looking at our increasing
take rates of advanced products. For example, HD sales increased more
than 57 percent compared to last year and we now have more than 2
million HD customers across the region. And, we’re aiming to expand
our advanced product offering even further as part of our larger effort
to build an even stronger allegiance to our brands through successful
targeted marketing and upgrade strategies. In addition, we will continue to
evolve our platform to meet our customers’ desire to view quality content
where and when they want it most.
PROFITABLY EXPANDING MIDDLE MARKET PENETRATION
Just as we’ve seen in the U.S., we are seeing a balanced growth pattern
emerge in Latin America as new consumers “age” into adulthood and
young pay-TV households expand across the region. And in every case,
we’re looking to leverage our scale to profitably serve the region’s
growing middle class.
We’re well aware that a one-size-fits-all approach won’t cut it. We must
continue to tailor our offers and products to provide our service to
value-focused customers that have the need and the desire for affordable
access to our brands and services. That means serving these middle
market customers through targeted marketing and distribution strategies,
as well as introducing lower-cost basic HD and DVR boxes at entry-level
prices to expand our value proposition and strengthen our competitive
position while maintaining strong financial returns.
BUILDING A WORLD-CLASS INFRASTRUCTURE TO ENHANCE
PRODUCTIVITY AND EFFECTIVELY MANAGE COSTS
As a rapidly evolving region, the challenge in Latin America is managing
growth. For DIRECTV Latin America, now is the time to build the framework
to support growth that will endure for the long term.
“...five-year vision… double our subscriber base from 8 to 16 million,
double revenues from $5 to $10 billion, maintain strong OPBDA margins
of about 30 percent, and deliver significant cash flow in 2016.”
A MESSAGE TO OUR SHAREHOLDERS ANNUAL REPORT 2012