DIRECTV 2012 Annual Report Download - page 29

DIRECTV
technicians. We also utilize an additional 10,000 technicians from four major are passed by cable, representing 99% of total U.S. homes. Most cable
outsourced companies who have assigned territories and a number of smaller television operators have a large, established customer base, and some have
subcontractors around the United States. The combined workforce completed significant investments in companies that provide programming content.
approximately 91% of all in-home visits in 2012. We set quality standards for all Approximately 100 million households subscribe to an MVPD service and
installation, upgrade, and service work, perform quality control procedures against approximately 57% of MVPD subscribers receive their programming from a
those standards, manage network inventory levels, and monitor overall network cable operator. In addition, most cable providers have completed network
performance for nearly all of the installation and service network. upgrades that allow for enhanced service offerings such as digital cable, HD
channels, broadband Internet access and telephony services. Cable
Customer Service Centers. As of December 31, 2012, we utilized 50 companies bundle these services, offering discounts and providing one bill
customer service centers employing over 18,000 customer service representatives. to the consumer. In addition, Verizon Wireless has entered into a joint
Most of these customer service centers are operated by Convergys Customer marketing agreement with Comcast, Time Warner Cable, Cox and
Management Group, Inc., Alorica, Inc., Sitel Operating Corporation, N.E.W. Brighthouse Networks to sell their products and services in storefronts and
Customer Service Companies, Inc., VXI Global Solutions, Inc. and over the Internet. These promotions are widely available across the United
Teleperformance. We currently own and operate six customer service centers located States.
in: Boise, Idaho; Tulsa, Oklahoma; Huntsville, Alabama; Missoula, Montana;
•Telephone Companies. Several telcos have upgraded a significant portion of
Huntington, West Virginia; and Denver, Colorado that employ approximately 4,000
their infrastructure by replacing their older, copper wire telephone lines with
customer service representatives. Potential and existing subscribers can call a single
high-speed fiber optic lines. These fiber lines provide the telcos with
telephone number 24 hours a day, seven days a week, to request assistance for
significantly greater capacity enabling them to offer new and enhanced
hardware, programming, installation, technical and other support. We continue to
services, such as broadband Internet access at much greater speeds and
increase the functionality of telephone-based and web-based self-care features in
digital-quality video. For example, Verizon announced that at the end of
order to better manage customer service costs and improve service levels.
2012, it had the capability to serve approximately 17.6 million homes with
fiber optic lines with the goal of having the capability to serve 18 million
Competition
homes. In addition, as of year-end 2012, AT&T had deployed fiber optic
We face substantial competition in the MVPD industry and from emerging lines with the capability to serve approximately 30 million homes. In
digital media distribution providers. Our competition includes companies that offer November 2012, AT&T announced plans to extend their fiber optic line
video, audio, interactive programming, telephony, data and other entertainment capability to serve 33 million homes by year end 2015. As of year-end
services, such as cable television, other DTH companies, telcos, wireless companies 2012, Verizon had approximately 4.7 million video subscribers and AT&T
and companies that are developing new technologies, including online video had approximately 4.5 million video subscribers, representing approximately
distributors, or OVDs. Many of our competitors have access to substantially greater 9% of MVPD subscribers. Similar to the cable companies, the telcos expect
financial and marketing resources. We believe our brand, the quality and variety of to offer their customers multiple services at a discount on one bill.
video, audio and interactive programming, quality of picture, access to service,
•Other Direct Broadcast Satellite and Direct-To-Home Satellite System
availability of HD and DVR services, customer service and price are the key
Operators. We also compete with DISH Network Corporation, or DISH,
elements for attaining and retaining subscribers. Our approximately 20.1 million
which had approximately 14 million subscribers at the end of 2012,
subscribers represent approximately 20% of MVPD subscribers at December 31,
representing approximately 14% of MVPD subscribers. On April 26, 2011,
2012.
DISH Network acquired certain assets of Blockbuster. Currently, DISH uses
•Cable Television. We encounter substantial competition in the MVPD Blockbuster威 and the Blockbuster@HomeTM service to offer video content
industry from cable television companies. According to the National through multiple distribution channels such as mail and through streaming
Cable & Telecommunications Association, 131.2 million U.S. housing units
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