planomateo
Member
DirecTV announced Q2 earnings yesterday and there is some good news for DirecTV customers. Basically they've agreed on the rates, don't have an ETA on launch date 
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Benjamin Swinburne - Morgan Stanley, Research Division
Mike, a couple of questions on the programming side. I don't know if you can comment yet, I know you're in the process of negotiating with Disney, but can you give us an updated thoughts you have on what the PSS idea might mean for DIRECTV? Is it something you think could be helpful in addressing the lower end of the market around affordability? I know it's an issue you care quite a bit about. And then somewhat related but different part of the programming story. On the Dodgers network, we saw Time Warner Cable today reduced their guidance, now factoring in no additional distribution, so I guess we know how they feel about the rest of the year, but the FCC has gotten involved. I don't know if you would comment on what your outlook is there and whether you think the FCC's role has an impact on DIRECTV beyond just this specific situation?
Michael D. White - Chairman, Chief Executive Officer and President
Sure. Happy to. Look, we continue to discuss with Disney, our overall deal. We have agreed on rates for the SEC Network, but we don't yet have a launch date, but we're hopeful and optimistic that we will be launching that network. On the PSS concept, we've looked at it, we're continuing to look at it. It's a bit of a challenging concept, to be honest with you, given the bundling when you look across the entire ecosystem, to be able to get the right number of best channel offerings that folks would want to see at a price point sub $30. And so I think it's certainly an interesting idea. I think it's certainly in the industry's interest if we could find a way to better service many of the -- both millennials, apartment dwellers and low-income Americans that want pay-TV, but it's so overpriced today that they're missing out on that opportunity. So we certainly see the strategic opportunity to service that segment, but it's a very tough challenge when you talk to other -- beyond Disney, when you talk to other media companies about rights and what you might do and the bundling that would end up getting jammed into it, it gets really hard to get to a price point that makes any sense without having a massive trade down risk on both revenues and profits for both distributors and the media companies. So it's certainly an idea that we're exploring. I think, frankly, we're more excited about some of the other things that we talked about in December, which is using an over-the-top approach to look at niche markets like ethnic markets, as well as what we're looking to do with our NFL SUNDAY TICKET this year, where we'll be offering it on 10 university campuses, and we're targeting 3 cities to test a more aggressive approach to servicing customers who can't get DIRECTV. With regards to the Dodgers, let me just make a couple of comments, Ben. First of all, I appreciate the concern of the congressional delegation and Chairman Wheeler about this unfortunate commercial dispute, and certainly, we're frustrated with the process as it has evolved. My overriding concern has always been to do what's right for our million-plus subscribers in the L.A. area. And in that regard, the challenge with this thing is that it's -- this and the Lakers deal that Time Warner Cable did, creates stratospheric pricing in the Los Angeles market, that if you did it for all of the sports teams that L.A. subscribers have to pay for, you would be at $26 per subscriber per month in the bill, and that's a huge tax, particularly on the many households that don't watch sports. I might note that last year, the Dodgers viewership was on average, 128,000 for any given game out of a total pay-TV marketplace in the L.A. area of 4.4 million. I'm pleased with our performance in L.A. Our gross adds were up strongly, and we're actually positive net adds in the L.A. area in the quarter. With that said, we're always open to discussion. In June, we put forward a proposal that would have compensated the Dodgers equivalent or more than the entire rights fees they got from all distributors combined in 2013, and it was rejected out of hand by Time Warner Cable. We will always negotiate in good faith. We're always open to meet and discuss. Quite honestly, I'm willing to consider some kind of mediation, but I don't yet know what Time Warner Cable has in mind in that regard. And, frankly, without the active and constructive participation of the ownership of the Dodgers, it's hard to see how you'd get any resolution to this dispute. But look, we like the Dodgers as a team, and we'd love to carry them on DIRECTV. But right now, I'd say we are where we are.
Transcript from http://seekingalpha.com/article/236...-results-earnings-call-transcript?part=single
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Benjamin Swinburne - Morgan Stanley, Research Division
Mike, a couple of questions on the programming side. I don't know if you can comment yet, I know you're in the process of negotiating with Disney, but can you give us an updated thoughts you have on what the PSS idea might mean for DIRECTV? Is it something you think could be helpful in addressing the lower end of the market around affordability? I know it's an issue you care quite a bit about. And then somewhat related but different part of the programming story. On the Dodgers network, we saw Time Warner Cable today reduced their guidance, now factoring in no additional distribution, so I guess we know how they feel about the rest of the year, but the FCC has gotten involved. I don't know if you would comment on what your outlook is there and whether you think the FCC's role has an impact on DIRECTV beyond just this specific situation?
Michael D. White - Chairman, Chief Executive Officer and President
Sure. Happy to. Look, we continue to discuss with Disney, our overall deal. We have agreed on rates for the SEC Network, but we don't yet have a launch date, but we're hopeful and optimistic that we will be launching that network. On the PSS concept, we've looked at it, we're continuing to look at it. It's a bit of a challenging concept, to be honest with you, given the bundling when you look across the entire ecosystem, to be able to get the right number of best channel offerings that folks would want to see at a price point sub $30. And so I think it's certainly an interesting idea. I think it's certainly in the industry's interest if we could find a way to better service many of the -- both millennials, apartment dwellers and low-income Americans that want pay-TV, but it's so overpriced today that they're missing out on that opportunity. So we certainly see the strategic opportunity to service that segment, but it's a very tough challenge when you talk to other -- beyond Disney, when you talk to other media companies about rights and what you might do and the bundling that would end up getting jammed into it, it gets really hard to get to a price point that makes any sense without having a massive trade down risk on both revenues and profits for both distributors and the media companies. So it's certainly an idea that we're exploring. I think, frankly, we're more excited about some of the other things that we talked about in December, which is using an over-the-top approach to look at niche markets like ethnic markets, as well as what we're looking to do with our NFL SUNDAY TICKET this year, where we'll be offering it on 10 university campuses, and we're targeting 3 cities to test a more aggressive approach to servicing customers who can't get DIRECTV. With regards to the Dodgers, let me just make a couple of comments, Ben. First of all, I appreciate the concern of the congressional delegation and Chairman Wheeler about this unfortunate commercial dispute, and certainly, we're frustrated with the process as it has evolved. My overriding concern has always been to do what's right for our million-plus subscribers in the L.A. area. And in that regard, the challenge with this thing is that it's -- this and the Lakers deal that Time Warner Cable did, creates stratospheric pricing in the Los Angeles market, that if you did it for all of the sports teams that L.A. subscribers have to pay for, you would be at $26 per subscriber per month in the bill, and that's a huge tax, particularly on the many households that don't watch sports. I might note that last year, the Dodgers viewership was on average, 128,000 for any given game out of a total pay-TV marketplace in the L.A. area of 4.4 million. I'm pleased with our performance in L.A. Our gross adds were up strongly, and we're actually positive net adds in the L.A. area in the quarter. With that said, we're always open to discussion. In June, we put forward a proposal that would have compensated the Dodgers equivalent or more than the entire rights fees they got from all distributors combined in 2013, and it was rejected out of hand by Time Warner Cable. We will always negotiate in good faith. We're always open to meet and discuss. Quite honestly, I'm willing to consider some kind of mediation, but I don't yet know what Time Warner Cable has in mind in that regard. And, frankly, without the active and constructive participation of the ownership of the Dodgers, it's hard to see how you'd get any resolution to this dispute. But look, we like the Dodgers as a team, and we'd love to carry them on DIRECTV. But right now, I'd say we are where we are.
Transcript from http://seekingalpha.com/article/236...-results-earnings-call-transcript?part=single
