Hughes Electronics - General Information

General Information

DirecTV provides television and audio services to subscribers through satellite transmissions. Services include the equivalent of many local television stations, broadcast television networks, subscription television services, satellite radio services, and private video services. Subscribers have access to hundreds of channels, so its competitors are cable television service and other satellite-based services.

Most subscribers use reception antennas which are much smaller than the first generation antennas, which were typically a few yards (meters) across. Advances in antenna technology, including fractal antenna layouts, have allowed a general reduction in antenna size across all industries and applications. Receiving equipment includes a satellite dish, an integrated receiver/decoder and a DirecTV access card, which is necessary to operate the receiver/decoder.

Consumers who purchase DirecTV subscribe to various packages of DirecTV programming for which the subscriber pays a monthly fee. Additional monthly fees may include a protection plan (which provides for repair or replacement of consumer leased equipment from damages caused by lightning, power surges, floods, etc.), DVR/HD access, additional receivers, and added premium packages. A subscriber also can order pay-per-view events and movies. DirecTV contracts with and pays program providers such as cable networks, motion picture distributors, sports leagues, event promoters, and other programming rights holders, for the right to distribute their programming to its subscribers. All programming distributed by DirecTV is delivered to its broadcast centers in Castle Rock, Colorado, and Los Angeles, where it is then digitized and compressed. The resulting signal is encrypted by DirecTV to prevent its unauthorized reception. DirecTV then transmits these signals to several satellites located in geostationary orbit.

As of December 31, 2006, DirecTV had approximately 16 million customers in the U.S., 1.4 million in Ibero America through its wholly owned subsidiaries, 1.3 million through its 74% ownership of Sky Brasil Servicos Ltda., and 1.4 million through its 41% ownership of Innova, S. de R.L. de C.V. of Mexico. 2006 revenues were US$14.76 billion.

In addition to serving consumers, DirecTV offers service to bars, restaurants, hotels, dorms, and hospitals through their DirecTV for business service. The company also offered mobile service for cars, boats, and RVs (DirecTV Mobile) as well as aircraft (DirecTV Airborne) in cooperation with Connexion by Boeing.