DirecTV is a direct broadcast satellite service based in El Segundo, California, which transmits digital satellite television and audio to households in the United States. Its primary competitors are Dish Network and cable providers. DirecTV currently has 18 million subscribers. The service was launched on June 17, 1994 and is now owned by The DirecTV Group, which is controlled by Liberty Media.
DirecTV has its own network called The 101 Network, available only to DirecTV subscribers in the United States. DirecTV is also the exclusive U.S. rights holder to sports packages NFL Sunday Ticket, NCAA Mega March Madness, and NASCAR Hot Pass.
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 dozens or 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 services, which used antennas a few yards (meters) across. The small antenna size is a characteristic of direct broadcast satellite (DBS) service, which uses more powerful satellite transmissions than previous satellites could produce. 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 purchased DirecTV equipment subscribe to various packages of DirecTV programming for which the subscriber pays a monthly fee. 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, California, where it is then digitized and compressed. The resulting signal is encrypted, or electronically scrambled, by DirecTV to prevent its unauthorized reception. DirecTV then transmits these signals to several satellites located in stationary orbit approximately 22,300 miles above the equator.
As of December 31, 2006, DirecTV had approximately 16 million customers in the U.S., 1.4 million in Latin America through its wholly-owned subsidiaries, 1.3 million through its 74% ownership of Sky Brasil Servicos Ltda., and 1.4 million though 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.
History
Stanley S. Hubbard founded United States Satellite Broadcasting (USSB) and was a leading proponent for the development of direct broadcast satellite service (DBS) in the United States. USSB was awarded 5 frequencies at the coveted 101 degree west satellite location by the FCC. Hughes Communications, a unit of GM Hughes Electronics, a remnant of Howard Hughes's company, was also awarded 27 frequencies at the same 101 degree location. After waiting many years, the technology evolved to enable the building of very high power satellites and digital compression (MPEG 2) standards were developed that allowed multiple digital television channels to be sent through each satellite frequency. After Hughes failed to complete a joint venture to launch the first high power digital television service called Sky Cable, the company created DIRECTV and secured an agreement with USSB to build and launch the first high power DBS satellite system. Hughes/DIRECTV then turned to Thomson Consumer Electronics (under the RCA brand) to develop the digital satellite system for the service that would be capable of receiving 175 channels on a small 18-inch dish. These dishes utilized a new generation of smaller, lighter receiver dishes based on military technology introduced by the Global Broadcast System (GBS), which predated DirecTV's viability by almost 10 years. Hughes was awarded the contract to build and launch the new high powered satellites and USSB and DIRECTV agreed that the new satellites would carry the two separate programming services: USSB and DirecTV.
On Friday, June 17, 1994, the USSB and DirecTV programming services were launched. Digital Equipment Corporation provided the hardware for DIRECTV, Matrix Marketing (part of Cincinnati Bell) provided customer care, and DBS Systems created the billing software, and is still the provider (as Amdocs) to this day.
In 1998, DirecTV acquired USSB for $1.3 billion.
In 1999, DirecTV acquired PrimeStar for $1.83 billion.
In 2000, DirecTV abandoned the Japanese market.
In 2002, DirecTV was the Mexican licensed broadcaster for the 2002 FIFA World Cup
In 2003, a merger with EchoStar, owner of Dish Network, fell through. On December 22, 2003, General Motors sold controlling interest in Hughes Electronics to News Corporation, forming the DirecTV Group. Certain conditions exist, however, in that News Corp must solve disputes with companies that carry its broadcast and cable channels. The corporation must treat all stations equally, not tilt in favor of the Fox Network and FX.
The arbitration was to alleviate concerns that Fox would pull its network programming, which includes professional baseball and football, off cable systems to encourage viewers to subscribe to DirecTV.
News Corp. agreed not to pull either the network programming or its regional sports networks while a dispute was being arbitrated.
In November 2006, News Corporation announced its intention to transfer its managing interest in The DirecTV Group to John Malone's Liberty Media; in return it bought back Liberty's shares in News Corp., giving the Murdoch family tighter control of the latter firm. On February 29, 2008, after receiving FCC approval, Liberty completed its acquisition of News Corporation's shares of DirecTV. Liberty put DirecTV's Puerto Rican operations in a trust to satisfy the FCC's requirement that it or Liberty Global's cable provider on the island be divested. In 2004, DirecTV abandoned the Mexican market, though it maintains 41% ownership of Sky Mexico.
On November 15, 2005, DirecTV stopped carrying Music Choice audio-only channels, replacing it with 73 channels of XM Satellite Radio.
In 2007, DirecTV abandons the Brazilian market (the customers being migrated to the 74% DTV-owned Brazilian affiliate of SKY Latin America).
DirecTV started a major upgrade to support HDTV. On January 9, 2007, DirecTV announced that they would introduce up to 100 national HD channels during 2007, all of which would be MPEG-4 encoded. On October 15, 2007, DirecTV announces that they now have 70 national high-definition channels available, with up to 100 coming by year end. On October 3, 2008, DirecTV announced that it will offer HD local channels in 121 markets by year-end.
- As of June 30, 2007, DirecTV had 16.32 million subscribers.
- On December 13, 2007, DirecTV is reported to buy out ReplayTV.
- On May 4, 2009, DirecTV said it would become a part of Liberty's entertainment unit, part of which would then be spun off as a separate company called DirecTV. Liberty would increase its share of DirecTV from 48 to 54 percent.
- On August 2009 Directv acquired Home Services Provider Connect Television Inc., increasing its workforce by more than a thousand employees.
On November 18, 2009, it was announced that DirecTV hired former PepsiCo International CEO Michael White as its new President and CEO. He will start on January 1, 2010. He will replace Chase Carey, now at News Corporation.
Receivers
In the past, receivers were manufactured by DirecTV and other companies. Other companies' DirecTV receivers have been phased out and DirecTV now designs their own models with companies such as Pace Micro Technology of Britain, LG of Korea, and Thomson of France. DirecTV is going to a whole-home DVR by 2010 which will be the only receiver distributed (once the other models run out) besides a standard HD non-DVR model. DirecTV and TiVo announced on September 3, 2008, that they will work together to develop a version of the TiVo service for DirecTV's broadband-enabled HD DVR platform. TiVo will develop the new HD DVR for an expected launch in the second half of 2009.
DirecTV typically uses a fixed 18-inch diameter dish antenna to receive its signals. Traditionally an 18×24-inch elliptical was used; however, most new installations use an 18x20-inch antenna to receive signals from three geostationary satellite positions simultaneously. These systems are becoming more common as DirecTV attempts to squeeze more programming onto its growing systems. DTV is now installing a dish that has five LNBs for HDTV programming and local channels in selected markets. These systems receive signals from up to five separate satellites in both the K u -band and K a <
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