DirecTV concerns are 'overblown'.(TIP SHEET)

Multichannel News, October, 2005

Banc of America Securities analyst Doug Shapiro reiterated his "buy" rating on DirecTV Group Inc. last week, citing potentially misguided concern over rising retention-marketing costs as the No. 1 direct-broadcast satellite service provider pushes HDTV and digital video recorders. In his report, Shapiro pointed to the economic difference between driving advanced-service penetration higher through upselling gross additions versus upgrading existing subscribers.

Also, in his analysis, even if DirecTV achieves 50% HD/DVR penetration by the fourth quarter of 2007, retention marketing costs will still remain within guidance of flat on an absolute basis and flat as a percentage of sales.