Directv Going To Lease Only On 3/1/06

[lee espinoza]

http://www.satelliteguys.us/showthread.php?t=52395

Is this a good thing or a bad thing?

[Lee L]

Well, itis bad for those of us who purchased expensive equipment as them giving us a "free" receicver sucks if we have to pay each month. For new subs, it probably just puts Satellite on a more or less equal footing with cable.

[patonenow]

I figured this would happen soon. One question-How if at all will that affect those that already own or have a committment left yet?

[Steveknj]

http://www.satelliteguys.us/showthread.php?t=52395

Is this a good thing or a bad thing?

Neither the link nor you explain what that means. Does this mean they will be following the cable model, you will no longer have to purchase the equipment, you will now lease?

Personally, if that's the case, I like it. This way I don't have to keep shelling out $$$ for equimpment that is obsolete in 6 months.

[morgantown]

http://www.satelliteguys.us/showthread.php?t=52395

Is this a good thing or a bad thing?

Hmmm... Good for them, bad for us. More revenue, better STB cost control. Seems more like a cable business model every day.

[Steveknj]

Hmmm... Good for them, bad for us. More revenue, better STB cost control. Seems more like a cable business model every day.

Well, how I look at it is this:

Now that I don't have to "buy" my equipment, when I finally go to HD service, I won't have to shell out hundreds of $$$ in equipment purchase, AND if the equipment improves I can turn in the old stuff for the new stuff.

One thing that has ALWAYS kept me with D* has been I have invested so much money in equipment. If I want to leave, it will be easier to justify since anything new I get will be leased/rented. With cable having better HD offerings and FIOS down the road, D* had better start improving their offerings otherwise people will feel more inclined to leave.

On the other hand, those of us who got free equipment as incentive will probably no longer see deals like that any longer.

[JimSpence]

But, you won't be able to "upgrade" the equipment.

Also, this scheme will make it more likely that subscribers will change providers more often.
Many of us with a lot of $$$ tied up in equipment tend to stay with DirecTV.
That incentive goes away with a lease.

[Frylock]

Exactly. So if it's the cable business model, why am I not going with cable? Bad move IMHO on DirecTV's fault. With this, I may as well go HDTivo than stick with DirecTV.

[dswallow]

Good move as an option. Bad move to be the only way. It will make for some interesting discussions how they decide to grandfather things in and/or compensate for recent prior purchases.

[youngdr]

But, you won't be able to "upgrade" the equipment.

I don't see this being too much of an issue any more, seeing as how most of the NDS equipment probably isn't "upgradeable" anyhow.

[SpacemanSpiff]

Extremely interesting move on their part. I guess that answers the question on whether the rebate on the R15 will be extended past the end of February. It certainly throws a monkey wrench into all the people who just plugged out the cash (less rebate) etc for R15's and re-upped for 2 year committments. I have to wonder what that will mean for them.

It also answers the question on whether the R15, HR20-250 and any other of the new boxes will be hackable. If they own the boxes, they can prevent people from hacking them.

I wonder where the PC D* Tuner card fits into the mix?

Granted one of the things cable has been able to throw at them is the contract (which for some reason they kept extending instead of reducing). Now the playing field is level. The question in my mind is did it go up or down?

[Draven X. Byrne]

Maybe that's why the new HR-20 DVR upgrade will be "FREE" for people with HR10-250's - they take our owned equipment and give us a lease box - bastards!

:down: :eek: :eek: :eek: :down:

DXB

[SpacemanSpiff]

I wonder where the press release about that change was during all the hubbub at CES. Certainly it's not new electronics, cut it certainly affects consumers.

[dswallow]

On relfection, I think the main point of this is to increase the paper value of the company; this will probably let DirecTV claim equipment as assets rather than taking charges for subscriber acquisition costs through equipment subsidies.

... or some other similar accounting difference under the new procedures ...

[Dan Collins]

They will almost certainly handle it the same way Dish network did when they went to this model over a year ago.

Anyone that purchased equipment recently will just continue under the same terms they have. No change. You purchased your equipment, so you don't pay a lease fee. You did, however, get an equipment subsidy, so you still have a commitment.

[JWThiers]

The only advantage D* has now is NFL Sunday Ticket, That Series 3 TiVo looks better all the time.

[lee espinoza]

The only advantage D* has now is NFL Sunday Ticket, That Series 3 TiVo looks better all the time.
So you want to pay a 1,000 for a HDDVR? :confused:

[Tom J]

Just when you think things couldn't get more confusing at DirecTV, this happens. I've been sitting on the fence over buying an additional HR10-250. Well I'm still on the fence but the fence posts just get sharper. Ouch! :eek:

Tom J

[araxen]

Dumb move on D*'s part. It just makes it easier for a person to change providers as they haven't locked themselves in by buying equipment.

[herdfan]

So you want to pay a 1,000 for a HDDVR? :confused:
Been there, did that. Twice! :eek:

[morgantown]

I rather have the option to own instead of only to lease any day.

What's next, $1 a month to rent the dish for new customers? Guess I might be considering buying that other DVR before March 1st for forward compatibility. Lets hope this story is just a bunch of hot air.

Nothing wrong with adding the availability to rent for those that want it though.

[grooves12]

The only advantage D* has now is NFL Sunday Ticket, That Series 3 TiVo looks better all the time.

I agree... I am VERY frustrated with DirecTV's HD offering, and despite the fact that I am one of their top customers was recently forced to pay $600 for an HD Tivo, another $50 for upgrading my satellite, and STILL don't have a solution for getting locals over the sat and/or recording them. Then they are going to FINALLY have a solution sometime down the road, and it will likely just end up costing me MORE money.

I've been a die-hard DirecTV lover and anti-cable person for a long time, but I am SERIOUSLY considering making the switch soon.

Although, the move to NDS controlled hardware may end up benifitting them sometime down the road, I think how they are handling the transition is SERIOUSLY hurting them. They are falling pretty far behind in the offerings from Cable and DishNet.

Personally, if the CableCard tivo is offered for rent through Comcast, I will be gone in an instant. That is... if I don't switch before then.

[zalusky]

What it says to me is they want to take back and control our experience and force feed their media aka commercials. They could offer both options but by by going leasing only its clear what they are doing.

It pisses me off that cable is mandated to allow open cable boxes but satellite doesnt have to. If they have a better product than let competition prove that.

I am going to be very interested comparing products at the end of this year.

[lee espinoza]

January 13, 2006

EXECUTIVE SUMMARY:

• DIRECTV will be migrating over to a new Lease Program on March 1, 2006, which will require you to sign a new agreement in order to continue working with DIRECTV. As such, this letter shall serve as the written notice required to terminate your existing agreement with DIRECTV. Please be advised that your existing agreement will terminate on February 28, 2006.

• In order for you to continue to act as a DIRECTV dealer, you must agree/accept/approve a new Agreement via the online acceptance method by February 28, 2006; the new agreement will govern our relationship under the Lease Program.

• Your current commission economics will not change other than starting March 1, 2006, commissions will now be paid only for leased equipment instead of purchased sales. Of course, commissions are subject to changes in the future in accordance with the terms of your Agreement.

• In addition, customers will continue to acquire their hardware from you under the Lease Program. Upon activation of the leased equipment, DIRECTV buys the equipment from you and issues payment. Please see details regarding the sale and purchase of leased equipment in the agreement, which will be made available to you shortly.

• Through the new lease model, standard, professional installation remains free for new customers and under the new terms of the lease model, it's free for existing customers as well!

• A Q&A sheet along with a more comprehensive outline of this program is included.

Countdown to the DIRECTV Lease Program!

On March 1, 2006, DIRECTV will be migrating over to a new hardware Lease Program. The Lease Program is designed to provide your customers with competitive offers and to help you continue growing your acquisition of quality customers. The DIRECTV Lease Program will be our primary hardware model to ensure our customers always have access to the most state-of-the-art, up-to-date equipment!

On March 1, 2006, all commission-based DIRECTV hardware transactions will be under the new Lease Program. It is important to note that your current commission economics will in no way change other than the fact that commissions will now be paid only for leased equipment instead of purchased equipment. Of course, your commissions are subject to change in the future in accordance with the terms of your new agreement.
It’s never been easier to have satellite television! With equipment replacement and upgrade offers through our DIRECTV dealers, the new Lease Program takes all the worry away from customers. In addition, leased receivers are backed by a convenient equipment replacement program. If the customer wishes to stop subscribing to DIRECTV service upon fulfilling their programming commitment, they are required to return the equipment to DIRECTV per the terms of the Equipment Lease Addendum.

Page 2 of 5

The new Lease Program requires customers to pay a nominal lease fee, some examples of which are highlighted below (please note that the following illustrations are for new customers only). Note that the monthly lease fee is in addition to applicable programming charges:

New Customer Hardware
Upfront Hardware Lease Fees
Total Monthly Costs to Customer
Commitment Period/Early Cancellation Fee
1 Standard Receiver
$0
$0 Lease Fee (no fee for first receiver)
+Monthly programming
1 Year/ $150 prorated
1 Standard Receiver + 1 DVR
$0 (after $100 mail-in rebate*)
$0 Lease Fee (no fee for first receiver)
+ $4.99 Lease Fee (for second receiver) + $5.99 DVR Service Fee (Whole House)
+ Monthly Programming
2 Years/ $300 prorated
2 DVRs + 1 HD
$197 (after $100 mail-in rebate*)
$0 Lease Fee (no fee for first receiver)
+ $4.99 Lease Fee (for second receiver)
+ $4.99 Lease Fee (for third receiver)
+ $5.99 DVR Service Fee (Whole House)
+ Monthly Programming
2 Years/ $300 prorated
1 HD DVR
$299 (after $100 mail-in rebate*)
$0 Lease Fee (no fee for first receiver)
+ $5.99 DVR Service Fee (Whole House)
+ Monthly Programming
2 Years/ $300 prorated

* New customers are eligible for one Advanced Receiver mail-in rebate ($100) per household; this rebate is subject to changes or termination.
Credit scoring at point of retail remains in effect with the new Lease Program, so the only change new customers will experience are the lower costs associated with becoming a new DIRECTV customer!
New Agreement Required for all DIRECTV dealers

This letter serves as written notice of DIRECTV’s termination of your agreement as required under your agreement with DIRECTV. Accordingly, your existing agreement will terminate on February 28, 2006. Because the lease program is an entirely new business model, it is necessary for every DIRECTV dealer to review and approve the new agreement no later than February 28, 2006. The new agreement will govern our relationship under the lease program. [Of course, both parties will continue to be responsible for any matters and issues from the terminated agreement after the termination date (e.g., payment of any unpaid commissions, chargebacks accruing in the future, any installation issues under the sales model, etc.)] To make this transition as easy as possible for our dealers, we expect that the new agreement will be available online in the next few days for your review and acceptance. Once the new agreements are available, when you log onto retailer.DIRECTV.com, you will be sent to the online agreement that is applicable to you. For your convenience, you may continue to go on to the dealer website without accepting the new contract, but be advised that you will be directed to the agreement each time you log on until you have agreed, accepted and approved. Please note that you have the right to review the terms of the new agreement before accepting it, but if the new agreement is not approved by the principal/owner of record by February 28, 2006, since your existing agreement will be terminated, you will no longer be able to continue as an authorized DIRECTV dealer after February 28, 2006.

By enabling all of our dealers to accept the agreement online, we ensure that our dealers have access to additional important information DIRECTV will post online in the future.

Page 3 of 5

Please note that on and after March 1, 2006, only hardware transactions under the Lease Program will be eligible for commission; any DIRECTV hardware sold by you will not be commissionable or subsidized in any manner or for any amounts whatsoever. All hardware subsidies will be subject to chargeback for sales made under the owned model. Further, under the new terms of the lease agreement, DIRECTV retailers are required to extend the lease offers to customers based on DIRECTV’s standardized lease transactions; see “Consumer Offers: Lease Transactions” in the online contract for full details. Dealers may not deviate from these lease transaction fees in any way since the lease offers are set and established by DIRECTV as the lessor.

We are excited to offer this new program to our customers and know that, with your help, it will be a success! If you have any questions, please contact your DIRECTV Area Sales Manager, Distributor Sales Representative, or DIRECTV Retail Services at 1-800-323-1994, or via email at RetailServices@DIRECTV.com.

Best Regards,
DIRECTV, Inc.

LSE_0106

Page 4 of 5

Q&A About the DIRECTV Lease Program
1. Q: Why is DIRECTV migrating from a hardware purchase model to a Lease Program?

A: Some of the most important reasons DIRECTV is migrating to the Lease Program are:

• To maintain a competitive offer in the market place by providing
DIRECTV customers a convenient receiver replacement program.

• Increase retention of DIRECTV customers, which should help reduce chargebacks.

2. Q: How is my commission affected by the Lease Program?

A: With the new Lease Program going into effect on March 1, 2006, dealers are paid commission only on those DIRECTV customers acquired under the terms of the new Lease Program. Some dealers may still sell receivers to customers, if they wish, but they will not be paid on those sales and the hardware will be in no way subsidized.

3. Q: How are mirroring fees impacted with the new Lease Program?

A: The bottom line is that a customer’s monthly bill will be nominally impacted. Although the term “mirroring fees” will go away in the Lease Program, customers will be subject to “monthly lease fees.” As with mirroring fees, the new “lease fees” are waived for the customer’s first receiver (lease fees are waived for the first receivers for new customers only; existing customers are subject to lease fees for any additional receivers they may acquire).

4. Q: Under the current model, I can currently charge whatever I want for the hardware as long as I absorb the cost if I offer it at lower than what is subsidized by DIRECTV; will this continue?

A: No. DIRECTV will be the party who will lease the equipment to the customers under the lease program. Accordingly, DIRECTV controls, sets and establishes the terms of the new lease program, including the lease fees charged for equipment. If you deviate in any way from the lease program as established by DIRECTV, including the standardized lease fees, you will be subject to immediate termination, without an opportunity to cure.

5. Q: Will the customer be getting used boxes with the Lease Program?

A: Through the Lease Program, there is the possibility that customers may get reconditioned equipment. Please keep in mind that DIRECTV will take precaution to ensure that any reconditioned equipment leased to customers is in “like new condition.” Of course, whether the equipment is new or reconditioned, it is covered by DIRECTV’s receiver replacement program.

6. Q: Why do I need to sign a new contract/agreement with DIRECTV?

A: Because the primary business model that DIRECTV works with its dealers on is changing, we need to have a new contract in place to support the new Lease Program. This will also allow us to provide contractual amendments to you online in the future!

7. Q: What happens if I sell (not lease) my customer a DIRECTV system after 2/28/06?

A: While you are not prohibited from selling DIRECTV hardware at prices established by you, please be advised that after 2/28/06, you will not be eligible to receive any commissions or subsidies for sold receivers. Accordingly, you will be subject to chargebacks for any subsidies or commissions you may have received, including any amounts under the Buy-Down Program. Please also note that only leased receivers will be eligible for ODU/Multi-Switch Reimbursement and commission.

Page 5 of 5

8. Q: Do Early Cancellation Fees or Differentiated Offer Fees change with lease?

A: No; both of these fees will be generally handled in the same manner as they currently are.

9. Q: With the lease model, will new customers now have to pay for standard, professional installation?

A: A: No! New customers will continue to get standard professional installation for free. In fact the great news is that with the lease model, both new and existing customers are eligible for free standard installation.

10. Q: How are existing customers affected by the lease model?

A: They aren’t. Existing customers who have already purchased hardware will continue to own their hardware. New customers who sign up for DIRECTV will be leasing the equipment. However, if an existing customer wishes to add additional receivers to what they already own on or after March 1, 2006, the newly acquired receivers will be under the terms of the lease model and the customer will be considered a mixed household, in which case they will be charged a lease fee on their leased equipment.

11. Q: How does my advertising need to change in order to promote the new lease model?

A: There will be changes reflected in all advertising once we migrate over to the lease model on March 1, 2006. We will be providing you ad slicks for the upcoming Q1 offer, which reflects the new hardware positioning and advertises our great, new programming offer that starts March 1.

Advertisements will continue to promote the free standard, professional installation but the equipment will now be leased, not owned. You will need to update the legal block to reflect the new terms of the lease, and, as always, all advertising must be sent through DIRECTV for approval.

12. Q: How does the Lease Program affect a customer’s experience at my store?

A: The customer experience will not change in regards to coming to you to acquire the best and latest DIRECTV hardware. The customer still comes to you for their DIRECTV system, they are credit scored, and you provide them with the hardware they need to access DIRECTV programming! The only thing that changes is the terms of the hardware, which will now be leased instead of owned. Upon cancellation/disconnection/termination of their DIRECTV account, they are required to return the equipment per the terms of the Equipment Lease Addendum, which replaces the old programming commitment agreement. If they do so before they have satisfied the programming commitment, they will also be subject to the early cancellation fees. The terms of ownership change, but accessing the premier multi-channel provider remains the same! DIRECTV is making it easier than ever for customers to get the most up-to-date, advanced hardware on the market through its dealers.
http://www.satelliteguys.us/showthread.php?t=52395&page=2

[disco]

Thanks for the letter, Lee!!

IMO, if I'm paying a *lease* fee, I should have NO UPFRONT COSTS, regardless of rebates! :down: After all, if I quit, they get the equipment back. It's that way with the cable companies, why not with sat??

[smark]

Interesting....

[dswallow]

I wonder what the "lease fee" will be compared to the mirroring fee that won't apply on leased units...

[tfederov]

I wonder if this means we will be unable to activate "used" receivers? I have an R10 I got from my folks and it's sitting in my closet as a backup. I'd sure hate to have to "give" it to D* if I ever activate it.

[disco]

So, wait...BASICALLY, all they're doing is renaming the "mirroring fee" to "lease fee"?? Right??

[skaeight]

The biggest way this changes things is if a customer cancels early. Under the current subscriber aggreement, if you return the equipment that you recieved when you began a commitment, they can't charge you a cancellation fee. Now they can, they've closed that loophole.

The one benefit I see to this, is that there is now free installation on new recievers for existing cutomers. That isn't that big of a deal, but it's kind of nice. Also does this mean that because the recievers are leased, there is now an automatic warranty on them? The letter mentions that leased subscribers are eligible for their "convienent equipment replacement program."

D*'s business model is now exactly like e*'s. All recievers are made in house, and now they are leasing instead of selling. There are also no more "mirroring fees" but instead "lease fees" (For some reason this has a physcological effect for me that it's not as bad, at least with the lease fee I'm paying for something physical, not just the right to use the service I already pay for in another room.)

From a business perspective, it does make sense. As was mentioned above, the company claim leased recievers as assets, instead of a loss (giving away recievers). In the end this doesn't really change a whole lot for the cutomer.

However, I'm not quite sure I like all the changes d* is making. There is most definitely a noticable difference in the pre rupert and post rupert days of d*. Also the Series 3 TiVo changes everything. At one point I was counting on settling for d*'s dvr when I decide to go HD, but at this point I will most likely look at cable in a couple of years once my d* contract is up and the prices on the series 3 have fallen.

[Scott in CO]

It looks like cost-wise it is a wash; the mirroring fee is replaced by the lease fee. The big difference appears to be that the customer will no longer own the hardware added after the leasing policy goes into effect.

[skaeight]

It looks like cost-wise it is a wash; the mirroring fee is replaced by the lease fee. The big difference appears to be that the customer will no longer own the hardware added after the leasing policy goes into effect.

This post along with one a few posts up bring up a very good point. What happens if a customer activates a receiver that that they already own, or buy from some other means (ebay, local dealer, etc.)? It would be a crime if after 3/1 any new activations become a lease. I really doubt that would be the case.

The letter does say that vendors can still sell recievers, but they will only be recompensated on leases. Anyone have any thoughts?

[HDTVsportsfan]

Through the new lease model, standard, professional installation remains free for new customers and under the new terms of the lease model, it's free for existing customers as well!

I wonder exactly what is included with the free installation for existing customers.

[amejr999]

From a typical consumer point of view, there's no change that I can see. 99% of people couldn't care less about having to give back their equipment when cancelling.

[morgantown]

So, wait...BASICALLY, all they're doing is renaming the "mirroring fee" to "lease fee"?? Right??

Yea it does look similar other than you are paying STILL paying upfront for equipment (I recognize it is subsidised) that must be returned once you are no longer a customer.

Given the depreciation of electronics, I can see how they would be looking for another write-off. Sounds more like a recycling program to me they could advertise. Environmentalists should love it. :D

It certainly could have been far, far worse though.

[lee espinoza]

Besides all of this I've been hearing that the programming packages will be dropping in price a little bit. The biggest drop will be for total choice premier customers with local channels. They know they must redo their pricing to compete with cable packages. I've also got hints that HD customers might just get the HD Package at no extra cost. What is unknown is if that would only be free for total choice premier customers or for all HD customers. Again consider this all rumors as of now because pricing is still being looked at from different points and as such things might change for the worse or better. Just rest assured that programming prices are being looked over and are planned to be adjusted to compete with both upcoming FIOS and cable offerings.

They also have plans for a triple play offering as well. They are looking at getting the wireless internet (not satellite internet but wimax type internet) service going as quick as they can. They are also looking at testing VoIP over the wimax system as well for customers with and without internet service. They are looking at the biggest discounts going to customers who order the video, VOD (via Wimax), internet service and VoIP services. These are being put into place for the future.

Once 2007 comes around and the first of the last two satellites go up expect a massive increase in both HD picture quality and national HD offerings. Once the last satellite goes up they will offer as you know all local HD stations.

The future plans for around 2008 is to have the following in place below.

One all SD local channels will be gone as they will no longer be broadcasting anymore. This means that all existing non local SD channels will be given much much better picture quality. This will also free up more space for new things in the future if technology allows. All HD local channels can and will be offered along with all available national HD channels. Again contracts must be done but they will have the room for them all and tons of future offerings.

They will also have their own high speed internet service offerings along with full two-way VOD ability using the Wimax system. They will also offer VoIP services over the Wimax system. They will have a leased hardware system and a triple and a future quad-play bundled offering.

The only problem with all of this is that for the next two or so years DirecTV customers will have great drawbacks as this is one of the most major transition periods DirecTV has ever done in their history. All I can say is that these next two years will no doubt be quite a bit crappy but they are laying one great foundation for the future with such great promise. All of these steps when announced one at a time look small but when you look at all these small steps in the bigger overall picture you can see what they are doing.

This isn't making excuses for them but just pointing out how all of this is and will be falling into place. This stuff just doesn't happen overnight and any type of change this big will tick off tons of customers.


http://www.satelliteguys.us/showpost.php?p=449304&postcount=25

http://www.satelliteguys.us/showpost.php?p=449332&postcount=29

[skaeight]

The future plans for around 2008 is to have the following in place below.

On[c]e all SD local channels will be gone as they will no longer be broadcasting anymore. This means that all existing non local SD channels will be given much much better picture quality. This will also free up more space for new things in the future if technology allows. All HD local channels can and will be offered along with all available national HD channels.


I've wondered about what will happen once local channels stop broadcasting in SD. Will it be a requirement for everyone to get an HD box in order to get locals? (of course the HD boxes will be able to used w/ SD tv's, they'll downcovert.) Also, are they definitely planning on offering HD locals in every market they currently offer SD locals?

This is all going to be very expensive for d*, if they are in fact migrating to only offering HD locals, then they will have to replace almost every dish and receiver in america.

[zalusky]

How do upgrades work? Right now, I just go buy it. In the future do they say you have to wait two years for full depreciation on the lease. DO they charge you the remainder of the prorated part of the lease. Obviously I cant give my receiver to my kinds anymore.

[kcarsten]

I've read this board for 3 years and this is the first real thing that really insites me to want to post a flamming fit!

If D* wants to move to a lease system like cable fine, I don't like it (the major reason I left cable againand bought 2 more tivos), but fine. But to fork out 200-300+ for equipment, then pay a lease on top and then to have to give the equipment back - blows! Way blows! For this I could have kept TW Explorer 8003 Dual Tuner HI-Def boxes at 15/box per month.

I love good tV, good video (dvd) have always been willing to pay more to be a semi-early adopter. Now it seems we get to keep on paying every month.

sucks.

[dswallow]

The future plans for around 2008 is to have the following in place below.

One all SD local channels will be gone as they will no longer be broadcasting anymore. This means that all existing non local SD channels will be given much much better picture quality. This will also free up more space for new things in the future if technology allows. All HD local channels can and will be offered along with all available national HD channels. Again contracts must be done but they will have the room for them all and tons of future offerings.
Well, this is probably not going to happen.

In order to drop the SD local channels, people will have to be able to receive the HD local channels from DirecTV. THat would mean DirecTV would have to upgrade some 15 million subscribers to the 5-LNB dish and provide them with a Ka-band/MPEG4-capable receiver or DVR to replace each and every receiver or DVR they currently have.

That is not something that will happen in a 2 or 3 year timeframe. There is no immediate benefit to DirecTV to eliminate local SD channel broadcasts. A lot of bandwidth would be freed, I agree... but it's really "local spot beam bandwidth" which is much less usable; figure the equivalent of a few national transponders. Really, it's pretty minor. It's not that much different than getting rid of all existing HD material on the Ku-band satellites.

[dswallow]

I've read this board for 3 years and this is the first real thing that really insites me to want to post a flamming fit!

If D* wants to move to a lease system like cable fine, I don't like it (the major reason I left cable againand bought 2 more tivos), but fine. But to fork out 200-300+ for equipment, then pay a lease on top and then to have to give the equipment back - blows! Way blows! For this I could have kept TW Explorer 8003 Dual Tuner HI-Def boxes at 15/box per month.

I love good tV, good video (dvd) have always been willing to pay more to be a semi-early adopter. Now it seems we get to keep on paying every month.

sucks.
Everything that's been posted so far indicates that nobody who bought their own equipment will pay a lease fee on any of that equipment; they specifically said it'd only apply to the new equipment one obtained under a lease. They also stated that DirecTV receivers would still be available for sale -- at least in a roundabout way, but indicating what happens to dealer commissions who sell receivers vs. lease them and how lease deals are reimbursed to the dealer.

[cheer]

They also have plans for a triple play offering as well. They are looking at getting the wireless internet (not satellite internet but wimax type internet) service going as quick as they can. They are also looking at testing VoIP over the wimax system as well for customers with and without internet service. They are looking at the biggest discounts going to customers who order the video, VOD (via Wimax), internet service and VoIP services. These are being put into place for the future.
If that's true, they're out of their minds. Building a network like this will be a money sinkhole, and when they finally get it done they'll realize the telcos (specifically Verizon and AT&T/SBC) got their FIOS and/or IPTV products delivered in the interim. If I were Ivan Seidenberg or Ed Whitacre I'd be cackling with glee.

Or is D* just going to lease the Wimax/whatever network from someone else? If so, that doesn't sound all that profitable.

[kcarsten]

Everything that's been posted so far indicates that nobody who bought their own equipment will pay a lease fee on any of that equipment; they specifically said it'd only apply to the new equipment one obtained under a lease. They also stated that DirecTV receivers would still be available for sale -- at least in a roundabout way, but indicating what happens to dealer commissions who sell receivers vs. lease them and how lease deals are reimbursed to the dealer.


There lies the rub... for me... when I left cable I went with a basic 4 room system (no DTIVO) knowing that D* had severed their relationship with TIVO. With a promise of an upgrade path to their new hd and dvr equipment - home media server getup when available.

The best part of D* and my stand alone TIVOs has been that it's mine, to use - to modify or whatever as I so desire... This stinks of big brother controlling/limiting "fair use" while increasing the revenue stream.

Yeah, it's a rant, and little can be done but it's yet again just one more thing... like the recent annual subscription committment per each tivo.

[bsnelson]

OK, so where does this leave someone like me? I have eight (count 'em) receivers on my account that I (obviously) bought. Do I still keep paying mirroring fees on seven of the machines? They can't charge me a lease fee on something I own. What gives?

Brad

[dswallow]

OK, so where does this leave someone like me? I have eight (count 'em) receivers on my account that I (obviously) bought. Do I still keep paying mirroring fees on seven of the machines? They can't charge me a lease fee on something I own. What gives?
As far as I can tell, nothing happens to you. You will continue to pay the current rates for your programming and the mirroring fee for the additional 7 receivers.

At some point in the future if some new piece of equipment comes out that you want, and you choose not to buy it but lease it instead, you will pay a lease fee on that piece of equipment instead of a mirroring fee for it.

[jdk]

If you read the whole dealer note this looks really like, from a customer point of view, like a semantics change.

1. Any receivers in your possesion on Feb 28th will be yours to "own". You will pay $5 per receiver (beyond the 1st one) mirroring fee.

2. Any receivers "received" from DirecTV after March 1st will be "leased", with a $5 per receiver "lease fee" (beyond the 1st one). There will be no mirroring fee for leased receivers.

These are the main facts taken from the note. Now what I'm not clear on are how the service contracts, ETFs and leases all tie in together.

Today if I cancel early, I don't own an ETF if I return my equipment. If I fulfill my service contract, I can cancel without an ETF, and the receiver is mine.

With the lease, will you still have to pay the ETF if you cancel early? Obviously you're going to have to return the equipment. What about at the end of the contract?

I don't think we know the answer to that yet. The pessimists would state the DirecTV is changing the rules to screw the customer more. The optimist in me holds hope out that this change is also a semantics change: we might be "leasing to own", and after the service contract period, the box is ours to keep.

This would be no different than what's in effect today: You get your extra-room SD box for $0 from Best Buy. It costs you $5 to use. If you cancel within a year, you either send it back to DirecTV, or pay an ETF. At the end of the year: its yours to keep.

So my bet this is a whole to-do about nothing.

[Rax]

Yeah, basically.

[disco]

So my bet this is a whole to-do about nothing.The problem arrises when you incorporate "upfront costs" for equipment. If I'm *leasing* the equipment, and it's never mine, then why should I pay $100-$300 *upfront*?? That's the only sticking point I have.

[sjberra]

The problem arrises when you incorporate "upfront costs" for equipment. If I'm *leasing* the equipment, and it's never mine, then why should I pay $100-$300 *upfront*?? That's the only sticking point I have.

Hit the nailon the head there - no way I am going to push out a 100-300 upfront cost for equipment that I will have to lease. I can go to my local cable company and get the equipment with 0 up front cost.

[Lee L]

I agree, this paying $300 up front and then a lease, total BS, I'm not leasing a car here people.


Something else I just thought of, this probably puts people like Solid Signal, Value Electronics and all the rest of the online dealers out of business (unless they have other lines to fall back on).

[SpacemanSpiff]

They can still lease the equipment.

On the other hand, they can still sell it. But for a premium. Like buying an unlocked cell phone.

[herdfan]

ISomething else I just thought of, this probably puts people like Solid Signal, Value Electronics and all the rest of the online dealers out of business (unless they have other lines to fall back on).
Why? They will still provide equipment to the end user only they will get paid a different way. And they have the option of selling the equipment only they won't get paid a commission on it and it won't be subsidized. So if you want a HD DVR that is yours, you can pay the cost of around $6-700 plus a dealer markup.

My concern is walking into a BB or CC and buying equipment. They are going to want more information than I am willing to give them.

My first thoughts when I read about this was that D* was going to take all equipment in-house and if you wanted a receiver, you had to call them and they would send it to you. That doesn't seem to be the case.

[beanpoppa]

For some reason, instead of making the 'lease fee' something like $2 for a basic receiver, $5 for a DVR, $7.50 for an HD Receiver, and $10 for an HD DVR like the cable co's do, they are front-end loading the difference. My cable CO charges $10/mo for an HDDVR. So, under this new lease model, I save $5/mo compared to the cable co, but have to shell out $300 up front. It would take me 5 years to make up that difference. I doubt I would have the same HD DVR for that long- it probably wouldn't last/would be out dated.

Bottom line for me- My hacked DTivo's with MRV are what keeps me with D*. When they go, there is nothing left to differentiate D* from E* from Comcast.

[IwantmyTiVo]

OK. I get the lease instead of the mirror fee for us current customers.

Why are you saying that If I get new equipment that I have to pay hundreds of dollars up front for it? Wouldn't I just call Directv and tell them I need a new or replacement box and they send it out to me and now I start paying for a lease fee instead of a mirroring fee on that unit?

I guess this means anyone who gets a leased equipment can't hack their equipment.

[skofarrell]

The only advantage D* has now is NFL Sunday Ticket, That Series 3 TiVo looks better all the time.


Yep. This is another nail in the coffin.

[skofarrell]

So you want to pay a 1,000 for a HDDVR? :confused:


Sure. and probably will when the series 3 comes out.

[Lee L]

Why? They will still provide equipment to the end user only they will get paid a different way. And they have the option of selling the equipment only they won't get paid a commission on it and it won't be subsidized. So if you want a HD DVR that is yours, you can pay the cost of around $6-700 plus a dealer markup.

My concern is walking into a BB or CC and buying equipment. They are going to want more information than I am willing to give them.

My first thoughts when I read about this was that D* was going to take all equipment in-house and if you wanted a receiver, you had to call them and they would send it to you. That doesn't seem to be the case.

Who knows, to me it just sounds like D* is not going to do equipment sales at all. If the costs are equal, it just seems like the online people lose their advantage.

[Kanyon71]

There lies the rub... for me... when I left cable I went with a basic 4 room system (no DTIVO) knowing that D* had severed their relationship with TIVO. With a promise of an upgrade path to their new hd and dvr equipment - home media server getup when available.

The best part of D* and my stand alone TIVOs has been that it's mine, to use - to modify or whatever as I so desire... This stinks of big brother controlling/limiting "fair use" while increasing the revenue stream.

Yeah, it's a rant, and little can be done but it's yet again just one more thing... like the recent annual subscription committment per each tivo.

I guess i'm missing the issue, if you can still buy the equipment as dswallow stated then it's your's whats the issue?

[Kanyon71]

Where does it say that people have to pay these up front equipment fee's on a lease?

[SpacemanSpiff]

New Customer Hardware
Upfront Hardware Lease Fees
Total Monthly Costs to Customer
Commitment Period/Early Cancellation Fee
1 Standard Receiver
$0
$0 Lease Fee (no fee for first receiver)
+Monthly programming
1 Year/ $150 prorated
1 Standard Receiver + 1 DVR
$0 (after $100 mail-in rebate*)
$0 Lease Fee (no fee for first receiver)
+ $4.99 Lease Fee (for second receiver) + $5.99 DVR Service Fee (Whole House)
+ Monthly Programming
2 Years/ $300 prorated
2 DVRs + 1 HD
$197 (after $100 mail-in rebate*)
$0 Lease Fee (no fee for first receiver)
+ $4.99 Lease Fee (for second receiver)
+ $4.99 Lease Fee (for third receiver)
+ $5.99 DVR Service Fee (Whole House)
+ Monthly Programming
2 Years/ $300 prorated
1 HD DVR
$299 (after $100 mail-in rebate*)
$0 Lease Fee (no fee for first receiver)
+ $5.99 DVR Service Fee (Whole House)
+ Monthly Programming
2 Years/ $300 prorated

* New customers are eligible for one Advanced Receiver mail-in rebate ($100) per household; this rebate is subject to changes or termination.


Note the bold sections.

[IwantmyTiVo]

Where does it say that people have to pay these up front equipment fee's on a lease?

That is what I am trying to figure out too.

[vstone]

1. Buying equipment, then paying a lease on it. That dog won't hunt. Even though that's how most car leases go, I don't see the consumer liking that.

2. I don't know how DISH does this, but the described scheme requires a minimum lease period. Again this is more like a car lease than cable, where I can go turn in the box anytime they're open.

3. They talk about easy upgrades, but there is nothing substantial that tells me that videophiles will be able to upgrade their equipment for free everytime new stuff comes out, as implied by one writer.

4. I don't think most local SD broadcasting will disappear very much before FEB, 2009. So I don't expect that D* SD programming will improve very much before FEB 2009. Most D* SD programming (less the premium channels) looks like crap on anything larger than 30". That's why I left D* for cable

[Kanyon71]

Note the bold sections.

Thats just incredibly lame, why in the world would I pay an upfront fee of that amount for something I have to give back? I wonder what the purchase costs will be for the equipment, think they will raise the price to make a purchase even more unattractive?

[GTO40]

A lease program could possibly limit owner added enhancements (adding Harddrives etc.) far more difficult to perform, since D* with "own" the equipment not you.

[vstone]

Thats just incredibly lame, why in the world would I pay an upfront fee of that amount for something I have to give back? I wonder what the purchase costs will be for the equipment, think they will raise the price to make a purchase even more unattractive?Think "car lease"

[SpacemanSpiff]

You're right on there. I can see that as a complete nail in the coffin of owner enhancements on D* DVR's. Granted you could possibly put in a bigger HD, saving the old one to put back in when you return it. But you still have to be able to configure the new one.

I find it interesting that they also state that there is always the possibility of leasing a refurbed model.

[dswallow]

Using additional receivers as an example...

Old way:

You spend $X at a retailer for a receiver. You pay $4.99 per month mirroring fee. There's a one year/$150 or two year/$300 prorated penalty for early cancellation. You own the equipment.

New way:

You spend $X up front lease cost for a receiver. You pay $4.99 per month lease fee. There's a one year/$150 or two year/$300 prorated penalty for early cancellation. You don't own the equipment.

It doesn't really look that attractive, especially considering the up front lease costs for the receiver look to be higher than market costs are for the equipment now.

[disco]

Think "car lease"But this isn't a car. It's apples and oranges: both fruit, but different.

DirecTV should be trying to compete with cable, and cable currently doesn't require an "up front" cost to get a digital receiver or HD DVR (at least, not in my market). They're pricing themselves out of some people's consideration (mine included).

[Lee L]

The more I think about it, if this is the way it goes down, this means I will probably be done with D* when teh HR10-250 can no longer receive the programming I want.

I can buy an HR10-250 right now for $399 after rebate at BestBuy without even trying and some are getting much better deals when calling retention. I can upgrade the hard drive (I have another 250 gig in mine) and when I leave D*, even if it is obsolete I can use the hard drive in a computer or toss it off the roof of a 5 story building just for the joy of seeing it get smashed.

No way am I going to pay $299 after rebate and then lease the receiver. (and yes I know it says the first receiver is a $0 lease, but I have one HD DVR , one SD DVR and 2 regular receivers.) I would say almost everyone here has more than one receiver.

Maybe this deal will be great for joe blow, the new customer that only wants one box, but for all of us, I can;t see how it is comparable.

[Kanyon71]

Think "car lease"

With my car lease I paid my first months payment up front which meant I didn't have to pay another payment for a month. So how is that a car lease? If you mean when you put down money for a lease thats Cap Reduction meant to lower your monthly payment.

[Kanyon71]

The more I think about it, if this is the way it goes down, this means I will probably be done with D* when teh HR10-250 can no longer receive the programming I want.

I can buy an HR10-250 right now for $399 after rebate at BestBuy without even trying and some are getting much better deals when calling retention. I can upgrade the hard drive (I have another 250 gig in mine) and when I leave D*, even if it is obsolete I can use the hard drive in a computer or toss it off the roof of a 5 story building just for the joy of seeing it get smashed.

No way am I going to pay $299 after rebate and then lease the receiver. (and yes I know it says the first receiver is a $0 lease, but I have one HD DVR , one SD DVR and 2 regular receivers.) I would say almost everyone here has more than one receiver.

Maybe this deal will be great for joe blow, the new customer that only wants one box, but for all of us, I can;t see how it is comparable.

Well from what doug (pretty sure it was him) was saying earlier you should still be able to buy equipment outright. If this is true I seriously wonder if they are going to up the prices.

[vstone]

But this isn't a car. It's apples and oranges: both fruit, but different.

DirecTV should be trying to compete with cable, and cable currently doesn't require an "up front" cost to get a digital receiver or HD DVR (at least, not in my market). They're pricing themselves out of some people's consideration (mine included).You're thinking service. They're thinking product and pricing.

I don't think this will be successful, but we'll see. Wait to see what someone with a 36" SDTV thinks when they're gone for the SD plus SD DVR package and sees what the SD PQ looks like, then wants out of their year commitment. You folks at customer retention, stand by.

[SpacemanSpiff]

Bet on it.

Second bet. Try to explain to a CSR that you want to activate a receiver that you purchased vs leased. I can hear the primal screams already.

[vstone]

With my car lease I paid my first months payment up front which meant I didn't have to pay another payment for a month. So how is that a car lease? If you mean when you put down money for a lease thats Cap Reduction meant to lower your monthly payment.Some car leases (perhaps the more high ticket cars) start with a large down payment (effectively shifting some of the monthly payments into the first payment). I presume that this is to offset the initial depreciation when you drive it off the lot.

I'm not claiming that this makes sense or that it will work, I'm just saying that there is a precedent.

[Adam1115]

I can't believe I'm reading you guys bitching and complaining about this! I don't know HOW many threads of people complaining that they bought an HR10 for $999 and it's obsolute! This is certainly designed to get rid of that problem! Upfront fee, ok, but it surely won't be $999! If all the $999 HR10 people paid $250 + $10 a month or some such thing they probably wouldn't be as unhappy about the move to MPEG4!

[mwarner]

I wonder if the $4.99 mirror fee is considered a programming fee, thus subject to going in the pool to pay program suppliers on a per receiver basis...

Change it to a $4.99 equipment lease fee, and DirecTV gets to keep the money and give nothing more to the programmers.

??

-Matt

[zalusky]

I still havent heard an answer to upgrades under the lease plan. Say I am new to D* and get a bunch of systems. 30 days later they come out with new cool system. Under todays model I can just sell my system on ebay and buy the new one.

Under the new plan do they:
1) Charge the ETF because you havent paid on it.
2) Do they say fine mail it back and heres the new one
3) Do they say mail it back and heres another upfront leasing fee
4) Do they say you have to wait for your lease period to end.

[Lee L]

I can't believe I'm reading you guys bitching and complaining about this! I don't know HOW many threads of people complaining that they bought an HR10 for $999 and it's obsolute! This is certainly designed to get rid of that problem! Upfront fee, ok, but it surely won't be $999! If all the $999 HR10 people paid $250 + $10 a month or some such thing they probably wouldn't be as unhappy about the move to MPEG4!

Well, this is a potential solution to avoid that in the future as a customer who starts 3-15 will not have any owned equipment, but it does nothing at all to ameliorate the problem of an obsolete HR10-250 for a current customer. In fact, I think many were holding out hope that the rumors that Bob Marsocci said that we "would be taken care of" would turn out to be true. IMO, if this is the deal, this is completely screwing those early HR10-250 people (like myself, I paid $899 due to an early prepay with VE) as we are getting nothing for our investment and support except the "opportunity to keep paying D* forever for a leased box.

[Kanyon71]

Some car leases (perhaps the more high ticket cars) start with a large down payment (effectively shifting some of the monthly payments into the first payment). I presume that this is to offset the initial depreciation when you drive it off the lot.

I'm not claiming that this makes sense or that it will work, I'm just saying that there is a precedent.

Thats called a Cap Reduction and is meant to allow you to have a lower monthly payment then if you didn't put that big payment down. The more money you put down the lower the monthly lease payment is based on what the car is worth at the end of the lease when you turn it in or buy it.

[Kanyon71]

I can't believe I'm reading you guys bitching and complaining about this! I don't know HOW many threads of people complaining that they bought an HR10 for $999 and it's obsolute! This is certainly designed to get rid of that problem! Upfront fee, ok, but it surely won't be $999! If all the $999 HR10 people paid $250 + $10 a month or some such thing they probably wouldn't be as unhappy about the move to MPEG4!

You can buy that same DVR right this minute for a LOT less then $999, so if you can get one for say $299 right now (a number I have seen some pay) and say the next guy pays $299 down for his lease then you both pay the same amount for the monthly payment and at the end you decide you don't want to stay with DirecTV any longer and you have to give your's back and he can sell his and recoup that initial investment. Now do you see what they are complaining about?

[JWThiers]

So you want to pay a 1,000 for a HDDVR? :confused:
Do I want to pay $1000 for an HDDVR, No but then again pricing hasn't been announced from what I have heard. That Said would I pay $500 (which is at the upper end of some of the unit cost mentioned) for one, that I own and can upgrade and tinker with if I see fit probably, especially if the alternative is renting one that I can't mess with because it isn't mine. One of the reasons I left cable in the first place was rental fees. I currently do not have HD, the reason is the price point for the equipment (TV, Tuner etc) is just getting to the point where I think it is doable and is getting better. This this year or early next is probably the year I want to make the switch. Now I may get stuck with rental fees on top of what I still consider an unknown quantity (the NDS based HDDVR) with an OS that from what I have read is still a little buggy (will probably change by the time I actually upgrade but with current info...).

So my apparent options when I go to upgrade are:

1. Stay with D* and use rented equipment with the above limits with a rental fee and HD package fee on top of my current. or

2. Get a series 3 when it comes out and pay tivo a higher rate for monthly DVR and get a box that is a known commodity as far as the OS look and feel and the features set I like.

My feeling is that since pricewise D* and cable is comparable for what I want. the only thing that D* offers that I cable doesn't is NFL (I don't get it anyway so its a push anyway). So I can get HD with the programing I want, use a DVR with a UI that I know I like (Unless series 3 changes it drastically which I doubt), own the equipment, and pay a similar price. Cable is starting to look like a reasonable choice, so when I do upgrade to HD I will definitely evaluate ALL of my options.

[Bill Broderick]

Using additional receivers as an example...

Old way:

You spend $X at a retailer for a receiver. You pay $4.99 per month mirroring fee. There's a one year/$150 or two year/$300 prorated penalty for early cancellation. You own the equipment.

New way:

You spend $X up front lease cost for a receiver. You pay $4.99 per month lease fee. There's a one year/$150 or two year/$300 prorated penalty for early cancellation. You don't own the equipment.

It doesn't really look that attractive, especially considering the up front lease costs for the receiver look to be higher than market costs are for the equipment now.

But don't forget that $X represents a price that has been subsidized by DirecTV. The "real" cost of those receivers is probably something more like $X*2.

Essentially, they are now saying we will subsidize the cost of the receiver if you return it when you cancel or you can buy it at the full unsubsidized price (see top of page 3 of the Executive Summary posted by Lee Espinosa) and keep it after you cancel. Either way, your monthly bill will remaing the same because you will pay a $4.99 "mirroring fee" for additional purchased boxes and you will pay a $4.99 "lease fee" for additional "leased" boxes.

The problem with buying at the unsubsidized price is that it is unlikely that you will be able to sell used recveivers for a price that is greater than the amount that was subsidized by DirecTV in the first place.

[IwantmyTiVo]

:down: DTV is going downhill. :down:

[MichaelK]

I've read this board for 3 years and this is the first real thing that really insites me to want to post a flamming fit!

If D* wants to move to a lease system like cable fine, I don't like it (the major reason I left cable againand bought 2 more tivos), but fine. But to fork out 200-300+ for equipment, then pay a lease on top and then to have to give the equipment back - blows! Way blows! For this I could have kept TW Explorer 8003 Dual Tuner HI-Def boxes at 15/box per month.

I love good tV, good video (dvd) have always been willing to pay more to be a semi-early adopter. Now it seems we get to keep on paying every month.

sucks.


everything except HD DVR's are basically free now a days. So It sounds to me rather then having to plunk down cash and get a rebate to get "free equipment" then pay a $5 mirror fee. Now you will get everythign for free and pay a $5 lease fee. The only differnce is now they can demand the equipment back when you leave. If they make the HD DVR's free but charge $10 a month they basically will equal cable.

They ahve said in their recent conference calls that they want the hardware back to reuse- it's a huge cost to them just handing out boxes fro free all over that they no longer own when people leave.

[Tekneek]

Given the quality of the new receivers/DVRs, giving them away is probably the best way to get anybody to use them.

[MichaelK]

Besides all of this I've been hearing that the programming packages will be dropping in price a little bit. The biggest drop will be for total choice premier customers with local channels. They know they must redo their pricing to compete with cable packages. I've also got hints that HD customers might just get the HD Package at no extra cost. What is unknown is if that would only be free for total choice premier customers or for all HD customers. Again consider this all rumors as of now because pricing is still being looked at from different points and as such things might change for the worse or better. Just rest assured that programming prices are being looked over and are planned to be adjusted to compete with both upcoming FIOS and cable offerings.

They also have plans for a triple play offering as well. They are looking at getting the wireless internet (not satellite internet but wimax type internet) service going as quick as they can. They are also looking at testing VoIP over the wimax system as well for customers with and without internet service. They are looking at the biggest discounts going to customers who order the video, VOD (via Wimax), internet service and VoIP services. These are being put into place for the future.

Once 2007 comes around and the first of the last two satellites go up expect a massive increase in both HD picture quality and national HD offerings. Once the last satellite goes up they will offer as you know all local HD stations.

The future plans for around 2008 is to have the following in place below.

One all SD local channels will be gone as they will no longer be broadcasting anymore. This means that all existing non local SD channels will be given much much better picture quality. This will also free up more space for new things in the future if technology allows. All HD local channels can and will be offered along with all available national HD channels. Again contracts must be done but they will have the room for them all and tons of future offerings.

They will also have their own high speed internet service offerings along with full two-way VOD ability using the Wimax system. They will also offer VoIP services over the Wimax system. They will have a leased hardware system and a triple and a future quad-play bundled offering.

The only problem with all of this is that for the next two or so years DirecTV customers will have great drawbacks as this is one of the most major transition periods DirecTV has ever done in their history. All I can say is that these next two years will no doubt be quite a bit crappy but they are laying one great foundation for the future with such great promise. All of these steps when announced one at a time look small but when you look at all these small steps in the bigger overall picture you can see what they are doing.

This isn't making excuses for them but just pointing out how all of this is and will be falling into place. This stuff just doesn't happen overnight and any type of change this big will tick off tons of customers.


http://www.satelliteguys.us/showpost.php?p=449304&postcount=25

http://www.satelliteguys.us/showpost.php?p=449332&postcount=29


they have been asked pointed questins repeatedly on the last few confernce calls about the lack of broadband and triple (and now quadruple) play. They have said nothign that sounded anything like they wer moving along on any of it. They say they see no rush to do it and might not ever. Last quarter (or the quarter before) the analysts even asked them if SkyTV in england just bought a broadband provider if they would and they said it's 2 different situations so what made sens in england might not make sense here. THey have been asked directly about wimax and said they only currently look at is as a way for them to get backhaul data (instead of PPV phone calls form the boxes) or maybe as a stretch as a way to do VOD but they didnt see it currently as anythign for them to over as an ISP- just internal use.

I wouldn't expect them to do anythign with broadband in the next couple years myslef.

[JWThiers]

Besides all of this I've been hearing that the programming packages will be dropping in price a little bit. The biggest drop will be for total choice premier customers with local channels. They know they must redo their pricing to compete with cable packages. I've also got hints that HD customers might just get the HD Package at no extra cost. What is unknown is if that would only be free for total choice premier customers or for all HD customers. Again consider this all rumors as of now because pricing is still being looked at from different points and as such things might change for the worse or better. Just rest assured that programming prices are being looked over and are planned to be adjusted to compete with both upcoming FIOS and cable offerings.
In my experience whenever pricing structure changes it means you will pay more (unless grandfathered). The first change in equipment or programing and you will be on the new system. I'm not saying its bad because you probably will be getting something added, the question is, is whats added worth the extra cost.

[MichaelK]

I've wondered about what will happen once local channels stop broadcasting in SD. Will it be a requirement for everyone to get an HD box in order to get locals? (of course the HD boxes will be able to used w/ SD tv's, they'll downcovert.) Also, are they definitely planning on offering HD locals in every market they currently offer SD locals?

This is all going to be very expensive for d*, if they are in fact migrating to only offering HD locals, then they will have to replace almost every dish and receiver in america.

Likely the next SD box they make will be able to decode MPEG4 and will be able to downconvert.

Come 2009 there will be no NTSC (analog SD) but only ATSC (DIgital can be HD or Not)- so at that point they will be retransmitting ATSC to everyone for sure. On ATSC, most all of the Big 4 (every fox is now I believe) and PBS will be HD for at least part of the day with plenty of UPN and WB in the larger DMA's. So by defualt I think they will be carrying any HD that exists with the 2 new sats in 2007. The only question is will they switch the channels that stay SD but go ATSC in 2009 to MPEG4 and/or to Ka.

[MichaelK]

Well, this is probably not going to happen.

In order to drop the SD local channels, people will have to be able to receive the HD local channels from DirecTV. THat would mean DirecTV would have to upgrade some 15 million subscribers to the 5-LNB dish and provide them with a Ka-band/MPEG4-capable receiver or DVR to replace each and every receiver or DVR they currently have.

That is not something that will happen in a 2 or 3 year timeframe. There is no immediate benefit to DirecTV to eliminate local SD channel broadcasts. A lot of bandwidth would be freed, I agree... but it's really "local spot beam bandwidth" which is much less usable; figure the equivalent of a few national transponders. Really, it's pretty minor. It's not that much different than getting rid of all existing HD material on the Ku-band satellites.

what doug said...

;)

[MichaelK]

The problem arrises when you incorporate "upfront costs" for equipment. If I'm *leasing* the equipment, and it's never mine, then why should I pay $100-$300 *upfront*?? That's the only sticking point I have.

with the exception of HD DVR's all their stuff is bacially $0 upfront now anyhow if you can get in on one of their deals of pester retention..

Maybe they plan to go free for the HD DVR's too with a higher lease fee?

Likely this is the market for valueelectronics and solid signal. Instead of the numbers int eh D* memo, they will offer equipment for free or much lower cost.

[beanpoppa]

Michael,
Their upfront pricing for the lease model was announced with the rest of the announcement. See http://www.tivocommunity.com/tivo-vb/showthread.php?p=3675097&&#post3675097

It's a $5 lease fee for any equipment (after the first receiver) with variable upfront costs. In effect, it's exactly the same cost as today, but with the exception that after 10 years of paying $5, you own $0 worth of equipment.

with the exception of HD DVR's all their stuff is bacially $0 upfront now anyhow if you can get in on one of their deals of pester retention..

Maybe they plan to go free for the HD DVR's too with a higher lease fee?

Likely this is the market for valueelectronics and solid signal. Instead of the numbers int eh D* memo, they will offer equipment for free or much lower cost.

[beanpoppa]

This is nothing like leasing a car/computer/boat. After the lease period for a car, you generally either return the item to the lesser, and lease a new one, or buy out the item for the pre-negotiated residual value. This can be done through cash, financing, or even re-leasing the same equipment to some new residual value. Under D*'s lease model, there is not buyout option, and they'll continue collecting $5/mo from you until they deem the item outdated. So if you lease their D20 with is MPEG4 compatible, and will compatible with D* for 15 years, you could pay $5/mo for 15 years ($900!) and still have nothing of value at the end.

This is really a RENTAL model. And it's why I refused to pay my cable co for their receiver.

[dswallow]

But don't forget that $X represents a price that has been subsidized by DirecTV. The "real" cost of those receivers is probably something more like $X*2.

Essentially, they are now saying we will subsidize the cost of the receiver if you return it when you cancel or you can buy it at the full unsubsidized price (see top of page 3 of the Executive Summary posted by Lee Espinosa) and keep it after you cancel. Either way, your monthly bill will remaing the same because you will pay a $4.99 "mirroring fee" for additional purchased boxes and you will pay a $4.99 "lease fee" for additional "leased" boxes.

The problem with buying at the unsubsidized price is that it is unlikely that you will be able to sell used recveivers for a price that is greater than the amount that was subsidized by DirecTV in the first place.
Recouping that subsidy is built in with the cancellation penalty. People will still be subject to the cancellation penalty even if buying their equipment.

[Bill Broderick]

Recouping that subsidy is built in with the cancellation penalty. People will still be subject to the cancellation penalty even if buying their equipment.

I don't know about that. Without the subsidized boxes, they no longer have any justification for an early cancellation penalty. Have you seen anything about this in writing? The Executive Summary doesn't address the issue.

[dswallow]

I don't know about that. Without the subsidized boxes, they no longer have any justification for an early cancellation penalty. Have you seen anything about this in writing? The Executive Summary doesn't address the issue.
Nothing has been said stating the receivers subject to lease are subsidized or that the receivers for sale aren't subsidized; the only thing said is that dealers won't receive a commission on sold receivers -- that they must mark up the price appropriately if they want to earn a profit selling receivers.

[Bill99]

Think of this as a marketing/advertising ploy. How many frozen faces have you seen when someone is told that in order to go with D* they have to purchase the equipment? "Well I just have to lease it from the cable company". D* never hears from these people. Now D* leases the equipment. "Hello, D*, I'd like to sign up". Now D* has them on the phone >>their goal<<. Now, it's easier to charge upfront costs for "extra" equipment since they now have the customers' attention. Makes sense to me.

However, put me down as a very unhappy customer since I no longer own the equipment. This after paying the same(?) price as previously.

[Jonathan_S]

Nothing has been said stating the receivers subject to lease are subsidized or that the receivers for sale aren't subsidized; the only thing said is that dealers won't receive a commission on sold receivers -- that they must mark up the price appropriately if they want to earn a profit selling receivers.

Page 3 of 5

Please note that on and after March 1, 2006, only hardware transactions under the Lease Program will be eligible for commission; any DIRECTV hardware sold by you will not be commissionable or subsidized in any manner or for any amounts whatsoever. All hardware subsidies will be subject to chargeback for sales made under the owned model.That certainly read to me as if they are stopping subsidies on sold hardware once the lease program takes over.

[SpacemanSpiff]

Thing is, it's the same cash up front whether it's a lease or purchase so I don't see how an unsuspecting customer would fall for it.

[dswallow]

That certainly read to me as if they are stopping subsidies on sold hardware once the lease program takes over.
The dealer won't be.

[dswallow]

Think of this as a marketing/advertising ploy. How many frozen faces have you seen when someone is told that in order to go with D* they have to purchase the equipment?
Some 15 million people figured it out.

[publicpersona]

I've been with DirecTV since the very beginning, and a multiple TiVo owner as well. Gradually, all of the reasons that I switched from cable have disappeared - content, customer service, ability to upgrade my equipment to suit my needs, etc.

I've got an appointment tomorrow morning to go back to cable. Sigh.

[Bill Broderick]

Nothing has been said stating the receivers subject to lease are subsidized or that the receivers for sale aren't subsidized;

From the executive summary:

any DIRECTV hardware sold by you will not be commissionable or subsidized in any manner or for any amounts whatsoever.

[beanpoppa]

Note sure what this part means, too:

4. Q: Under the current model, I can currently charge whatever I want for the hardware as long as I absorb the cost if I offer it at lower than what is subsidized by DIRECTV; will this continue?

A: No. DIRECTV will be the party who will lease the equipment to the customers under the lease program. Accordingly, DIRECTV controls, sets and establishes the terms of the new lease program, including the lease fees charged for equipment. If you deviate in any way from the lease program as established by DIRECTV, including the standardized lease fees, you will be subject to immediate termination, without an opportunity to cure.

[dswallow]

From the executive summary:

any DIRECTV hardware sold by you will not be commissionable or subsidized in any manner or for any amounts whatsoever.
This was aimed at dealers; you'll probably find DirecTV uses that language (subsidies and commissions) in their dealer-speak, and that is quite different from the concept of subsidizing the manufacture like we've been referring to with regard to why the cancellation penalty exists when new receivers are activated.

[zalusky]

I would like to hear what Robert from VE has to say on this. He has been pretty quiet.

[SpacemanSpiff]

He's probably still digging out from under the CES backlog. On the other hand it could be something that he's looking into with his lawyer so see exactly what boils down where.

[MichaelK]

Michael,
Their upfront pricing for the lease model was announced with the rest of the announcement. See http://www.tivocommunity.com/tivo-vb/showthread.php?p=3675097&&#post3675097

It's a $5 lease fee for any equipment (after the first receiver) with variable upfront costs. In effect, it's exactly the same cost as today, but with the exception that after 10 years of paying $5, you own $0 worth of equipment.


I'm just assuming that's their "retail" pricing. Value electronics and Solid Signal never sell at retail. No one even pays "retail" at CC or BB- it's all specials, sales, or rebates.

So I assume just like it is today (with the exception of HD DVR's) you can get pretty much everythign for free. But the difference will be since they paid for it all they actually get wise and ask for it back.

For me all that really matters is the HD DVR so I need to see how that plays out before i pass judgement.

[MichaelK]

This is nothing like leasing a car/computer/boat. After the lease period for a car, you generally either return the item to the lesser, and lease a new one, or buy out the item for the pre-negotiated residual value. This can be done through cash, financing, or even re-leasing the same equipment to some new residual value. Under D*'s lease model, there is not buyout option, and they'll continue collecting $5/mo from you until they deem the item outdated. So if you lease their D20 with is MPEG4 compatible, and will compatible with D* for 15 years, you could pay $5/mo for 15 years ($900!) and still have nothing of value at the end.

This is really a RENTAL model. And it's why I refused to pay my cable co for their receiver.

very good point- its rental.

[hoopsbwc34]

I'm curious to see what happens when someone tries to activate a device they OWN after 3/1/06.... will they still charge a $5/month mirror fee for these people? If they don't, I'll be deactivating on 2/28 and reactivating on 3/1 :) There's no discussion in the press release on what happens when people do own their own equipment....

[tbeckner]

For me, what made DirecTV such a good provider is that I could choose the equipment I wanted to use. And I could purchase it and not have to look forward to the monthly fees. This is still something that has bothered me with cable and using their DVRs. I hated the concept of leasing a box. But in a fast changing market, it is likely a push, but if I was buying into SD today (not HD), I would really hate this and I believe it would make the decision to go to cable even easier, but then again this is just the way I look at it.

I guess we all will need to see what difference this change will make to each of us financially. Three years ago I bought three HDVR2s for $99 each and if DirecTV had leased those HDVR2s to me for $10 per month in addition to the device/mirroring fees, I would not have done it. Because even with taking into account the future value of money (purchase vs lease), I would have paid three times as much over those three years for the same capability, and at this point I am looking forward to using those same HDVR2s for at least another three years, depending upon the situation, before I go HD.

[Kanyon71]

Given the quality of the new receivers/DVRs, giving them away is probably the best way to get anybody to use them.

You have some proof of that statement? Or isit just a general dislike?

[hoopsbwc34]

I guess we all will need to see what difference this change will make to each of us financially. Three years ago I bought three HDVR2s for $99 each and if DirecTV had leased those HDVR2s to me for $10 per month in addition to the device/mirroring fees, I would not have done it. Because even with taking into account the future value of money (purchase vs lease), I would have paid three times as much over those three years for the same capability, and at this point I am looking forward to using those same HDVR2s for at least another three years, depending upon the situation, before I go HD.

You're paying the same out of pocket and month to month...now your "mirroring fee" is a "lease fee".

[Lee L]

Think of this as a marketing/advertising ploy. How many frozen faces have you seen when someone is told that in order to go with D* they have to purchase the equipment? "Well I just have to lease it from the cable company". D* never hears from these people. Now D* leases the equipment. "Hello, D*, I'd like to sign up". Now D* has them on the phone >>their goal<<. Now, it's easier to charge upfront costs for "extra" equipment since they now have the customers' attention. Makes sense to me.



Makes no sense to me. As others have said, it is not like they bring a receiver out for free and you pay each month. Unless you get the base receiver (of which I got 2 free when I bought my HR10-250 and SDDVR40 almost 2 years ago.) you are paying money up front still for even one receiver. DirecTv has already said that they are pushing DVRs so unless they change the program, they are shooting themselves in the foot here.

[SpacemanSpiff]

The difference being that after the 1 or 2 year committment if you drop D* you can take bought equipment and throw it in the trash, put it in a closet or sell it on EBay. After the 1 or 2 year committment on leased equipment, you're out the same amount of money but when you drop the service you have to send it back.

[dswallow]

The difference being that after the 1 or 2 year committment if you drop D* you can take bought equipment and throw it in the trash, put it in a closet or sell it on EBay. After the 1 or 2 year committment on leased equipment, you're out the same amount of money but when you drop the service you have to send it back.
And that used equipment will get released to others, likely increasing the average age of the equipment in use to receive DirecTV. That might not be a good thing in some senses.

[Kanyon71]

For me, what made DirecTV such a good provider is that I could choose the equipment I wanted to use. And I could purchase it and not have to look forward to the monthly fees. This is still something that has bothered me with cable and using their DVRs. I hated the concept of leasing a box. But in a fast changing market, it is likely a push, but if I was buying into SD today (not HD), I would really hate this and I believe it would make the decision to go to cable even easier, but then again this is just the way I look at it.

I guess we all will need to see what difference this change will make to each of us financially. Three years ago I bought three HDVR2s for $99 each and if DirecTV had leased those HDVR2s to me for $10 per month in addition to the device/mirroring fees, I would not have done it. Because even with taking into account the future value of money (purchase vs lease), I would have paid three times as much over those three years for the same capability, and at this point I am looking forward to using those same HDVR2s for at least another three years, depending upon the situation, before I go HD.

Thats really what I want to know also, how is this going to effect the price that I pay if I want to purchase my equipment.

[tbeckner]

You have some proof of that statement? Or isit just a general dislike?It likely is because the R15 has some bugs and if a long term TiVo user would make a comparison of the R15 to a Series 2 DirecTiVo they might believe that the R15 is less valuable, depending on what features the TiVo user always uses.

In my case, I have been using TiVo for almost six years now, and after a review of the feature set in the R15 and the reported bugs on the other forum, I would not buy (even if it was free after rebate or lease a new R15. Now that is my individual choice and it does not mean that someone else might find the R15 of some value.

[tbeckner]

You're paying the same out of pocket and month to month...now your "mirroring fee" is a "lease fee".What if I didn't have any equipment at all? Do we know what they are going to lease the new equipment for?

If the $4.99 device/mirroring fee would be switched to a equipment leasing fee directly then that would be a different story. Do we know if that is what this means for sure?

[Kanyon71]

It likely is because the R15 has some bugs and if a long term TiVo user would make a comparison of the R15 to a Series 2 DirecTiVo they might believe that the R15 is less valuable, depending on what features the TiVo user always uses.

In my case, I have been using TiVo for almost six years now, and after a review of the feature set in the R15 and the reported bugs on the other forum, I would not buy (even if it was free after rebate or lease a new R15. Now that is my individual choice and it does not mean that someone else might find the R15 of some value.

I actually have both of them and use both of them and like both of them. I will tell you onething the R15 seems to be built a lot better it's much quieter and has some cool features. Outside of some bugs I don't really have anything to complain about with it. As you said to each their own though :)

[JohnTivo]

So does this mean there is no more 1 or 2 year commitment required if you lease the equipment?

[SpacemanSpiff]

Wrong. You still have the committment. You still have the up front cash outlay. From what we can tell, the only differences are that you no longer pay "mirroring fees" but "lease fees" and when you're done with D* no matter how long you have the equipment, you have to send it back.

[tbeckner]

Wrong. You still have the committment. You still have the up front cash outlay. From what we can tell, the only differences are that you no longer pay "mirroring fees" but "lease fees" and when you're done with D* no matter how long you have the equipment, you have to send it back.But the assumption here is that you originally leased it from them and not purchased it.

The funny thing, depending upon the actual details of this agreement (and the devil is in the details), this could make it more likely that users might stay with cable or go with cable when they have to make a choice. I guess we will have to wait for it to shake out.

[patonenow]

If I buy something,I buy it. If I rent (D*"lease") something ,then I rent it. However, once someone OWNS something (after commitment) then there should be NO further commitment EVER.
D* is in the business to sell you programing. IF you have no way to buy their programing then they are out of business. So if you lease,fine, then they are also making you pay for something that they would otherwise not being able to sell. RENT is forever. But if you own then why should there be ANY commitment? You should be able to pick your programmer and within reason drop and get again according to your desire.
This all goes back to the BIG DISH days when they feared them so then they got most to convert to E* or D* and GAVE you offers you couldn't pass up. Sort of what comcast etc. are doing right now by giving you great offers by turning in a tivo or E* or D* receiver to them for it.
The name of the game is to lock you in and if you own the equipment they can't. So in the future NO commitment should be needed IF you already own the equipment. That is if you use your backbone and stick up for what is fair.

[cowboys2002]

I stumbled on this thread earlier today.

Mirror Fee/ Lease Fee. It's all semantics. It's still an extra $5 for each reciever after the first one and $5.99 DVR/TIVO fee ONCE per account. So for my 3 receivers, my bill doesn't change.

My concern is after March 1, 2006 am I subject to an ETF (only 1 receiver has a commitment left), the others are 12 months old (at least).?

I guess we will all have to wait and see after 3/1/06.

I am looking to move in the next 4-6 months and was going to use the Mover's Program. My concern is, if I take the free installation, is DTV going to subject me to a 2 year commitment on all 3 receivers (that I bought) and charge me an ETF if I cancel, say in 12 months?

:confused:

BTW, I stopped subscribing to NFLST this season due to blackout issues 2004 Season. And I don't have any movie channels. My incentives for not using going to cable are dwindling!! I have only had to call DTV CSR maybe 10 times over the course of 9 years. Mostly to buy DVR's!!!

[tbeckner]

If I buy something,I buy it. If I rent (D*"lease") something ,then I rent it. However, once someone OWNS something (after commitment) then there should be NO further commitment EVER.
D* is in the business to sell you programing. IF you have no way to buy their programing then they are out of business. So if you lease,fine, then they are also making you pay for something that they would otherwise not being able to sell. RENT is forever. But if you own then why should there be ANY commitment? You should be able to pick your programmer and within reason drop and get again according to your desire.
This all goes back to the BIG DISH days when they feared them so then they got most to convert to E* or D* and GAVE you offers you couldn't pass up. Sort of what comcast etc. are doing right now by giving you great offers by turning in a tivo or E* or D* receiver to them for it.
The name of the game is to lock you in and if you own the equipment they can't. So in the future NO commitment should be needed IF you already own the equipment. That is if you use your backbone and stick up for what is fair.I see no validity in the argument that a rental/lease approach would decrease the CHURN rate. In fact, I view a large equipment purchase and investment as being a true deterrent to leaving the service.

When you make a large capital outlay, you need to recoup those costs and the longer you stay with the service relationship the initial capital investment becomes smaller, so I view a rental/lease approach will ultimately increase DirecTV’s growing CHURN rate. In other words, why should I stay if I have not capital outlay to recoup?

For me, if I was renting or leasing the equipment, except for the initial commitment time period, I would be gone in a flash if a better opportunity presented itself, because I wouldn’t be worried about recouping any investment in equipment.

I know based upon their annual SEC reports, that DirecTV’s CHURN rate has been increasing and their growth rate in new subscribers should only be two thirds as large as it was in 2005, so maybe they see this as a way to increase their new subscriber counts, which it could, but it could also increase their long term CHURN rate.

So, a switch to a rental/lease approach should increase short term new subscriber counts and leave short term CHURN rate alone. Ultimately it will increase CHURN rates above historical norms once the initial commitment periods start expiring.

[DuPeD]

What I would really like to know. Is a time frame for the death of my HD Tivo unit. Currently I can record off-air HD signals. But, at what point will the DTV decoding stop. In other words, when DTV swithches to MPEG4, ALL the recievers will stop. :eek: The current hardware won't decode it, and can they be upgraded (with new softare codecs) or are the codecs hard imbedded. :confused:

[newsposter]

Haven't seen this addressed. Will i be able to deactivate my T60 today, then in a year from now get it activated? Just a theoretical question.

[herdfan]

Some car leases (perhaps the more high ticket cars) start with a large down payment (effectively shifting some of the monthly payments into the first payment). I presume that this is to offset the initial depreciation when you drive it off the lot.
Its not. It is to lower the monthly payment. Many people won't qualify to pay $1500/mo on a car payment, but they do have $10K saved for a down payment. So they pay the $10K upfront and pay $1200/mo over 3 years. At the end of the lease, they have paid the same total amount whether the pay a large down payment or not.

The big difference here is that at the end of the lease, I have the contractual right to purchase the car for the pre-agreed upon amount. Can't do that with D*'s equipment.

Note: I will probably never own a car again. Leasing is much more convenient and it keeps me from trading cars on a whim. I know I will have mine for 2 years and my wife will have hers for 3 years.

[herdfan]

I know based upon their annual SEC reports, that DirecTV’s CHURN rate has been increasing and their growth rate in new subscribers should only be two thirds as large as it was in 2005, so maybe they see this as a way to increase their new subscriber counts, which it could, but it could also increase their long term CHURN rate.
I have to wonder how high the CHURN rate has to get or low the sub growth gets before RM realizes that some of his bonehead decisions are what is causing it. Maybe he will decide he doesn't want to own a satellite company anymore. :eek:

And who owns the other 63% and why are they letting him run the show?

[jrinck]

This has probably already been covered, but...

Will we no longer have a choice as to what receiver we use? So if DTV decides to contract out their DVR/receivers, we'll get whatever crap gets pinched out by the lowest bidder?

[dswallow]

Will we no longer have a choice as to what receiver we use? So if DTV decides to contract out their DVR/receivers, we'll get whatever crap gets pinched out by the lowest bidder?
Eventually there will only be a handful of models to choose from anyway:

D10/D11 - SD Receiver
R10 - SD DVR (TiVo)
R15 - Interim SD DVR (NDS)
R20 - Upcoming MPEG4 SD DVR (NDS)
H10 - HD Receiver
H20 - MPEG4 HD Receiver
HR10 - HD DVR (TiVo)
HR20 - Upcoming MPEG4 HD DVR (NDS)

As you can tell, there'll be an obvious need to just phase some of those out and that really will leave you with one standard receiver, one HD receiver, one standard DVR and one HD DVR. You won't choose anything but the level of service you want out of your receiver. They'll be made by any of the several large electronics companies, but they'll all be labeled as DirecTV.

I suppose we should see a D20 model - MPEG4 capable SD Receiver... doesn't sound all that necessary for several years, though.

And as for their model naming methodology -- seems damaged. I'd have use S10/S11 and SR10/SR15/SR20 and give the whole scheme some consistency.

[Adam1115]

You can buy that same DVR right this minute for a LOT less then $999, so if you can get one for say $299 right now (a number I have seen some pay) and say the next guy pays $299 down for his lease then you both pay the same amount for the monthly payment and at the end you decide you don't want to stay with DirecTV any longer and you have to give your's back and he can sell his and recoup that initial investment. Now do you see what they are complaining about?

Not exactly right. Yes, DirecTV has drastically lowered the price to clear out the obsolete unit before the new model hits the shelf, Best Buy sells the unit for $599. A FAR cry from $299.

Yes, DirecTV offered a 'fire sale' to certain existing DirecTV subs that threatened to qiuit and go to cable, you act like that was the street price. And it was $399 with a $100 rebate, which many never got. So I don't know how you are comparing an announced $299 street price for their brand new model to a customer retentions fire sale. The $299 lease is $300 less than the Best Buy price of the obsolete HR10.

So no, I don't see why they are complaining. DirecTV hasn't announced that they won't offer a special to existing HR10 users, in fact they've said the exact opposite. Why do you assume they won't take care of HR10 users? It may be a free upgrade!

[Adam1115]

Typical TCF DirecTV sub:

"I want an HD-TiVo! Oh good it came out, I'll shell out $999 the first day it's on sale."

"Why doesn't it have the latest OS? Sure I bought it this way, but I want it different! I paid a lot"

"Why is the unit so expensive?"

"Why are they selling it to some people for $299? I paid $999? Yes I thought that was too expensive, but now I'm pissed they are selling it cheap!"

"I hate the HR10, it doesn't have 6.2"

"I hate the HR20, it doesn't have TiVo."

"I want HD-LIL on my HR10." But you can't... "But I want it.." But you can't... "but I want it.." <SIGH>

"I want the HR20 for free because I paid $999 for the HR10" Ok fine. "But I don't want the HR20 cuz it doesn't have tivo." Ok, keep your HR10. "But I don't want the HR10 cuz it doesn't have HD-LIL." Ok, get the HR20. "Only if it's free." Ok it's free. "I don't want it because it doesn't have TiVo."

"Why are they going to sell it new for $299? I paid $999?" Because people bitched that $999 was too much. "It is too much, but I paid it so everyone should."

"I don't want to pay $299 for a new one I want it free." It probably will be. "No it won't" How do you know? "I don't, but I don't want it anyway it isn't a TiVo."

No wonder DirecTV doesn't know what we want...

[Bill99]

Cable Company: "Hi Fred. We have a great deal for you if you switch to us from Directv. Blah, blah, blah".

Fred: "Sounds great! Sign me up".

>>>2 months later>>>

Fred's Wife (Hazel): "Honey, this cable is crap. I want my satellite back. Call Directv and have them activate our old equipment".

Fred: "Sorry sweetie. We sent all the equipment back. We'd have to purchase that equipment again".

Hazel "But didn't we purchase it originally? And you sent it back?"

Fred: "Uuuh... ".

Hazel: "You will sleep on the sofa tonight".

[Tekneek]

You have some proof of that statement? Or isit just a general dislike?

I base it on comments I have read from other customers online and what installers have told me, when it comes to the DVR. On the receivers, I have an H20 and can say I find it inferior to my previous HD receiver. I only switched to get MPEG4.

[Tekneek]

No wonder DirecTV doesn't know what we want...

That was a great read. It really does seem that way.

[vigfoot]

"The only problem with all of this is that for the next two or so years DirecTV customers will have great drawbacks as this is one of the most major transition periods DirecTV has ever done in their history."




Hmmm. Thus the 2-yr. commitment begining last August?

[ShiningBengal]

From a business perspective, it does make sense. As was mentioned above, the company claim leased recievers as assets, instead of a loss (giving away recievers). In the end this doesn't really change a whole lot for the cutomer.



There is no business model whatever that would justify "owning" depreciating assets. You want to own appreciating assets, and lease depreciating ones. Once DirecTV owns all of their IRD's, they will have one HUGE montly depreciation charge on otheir income statements which will more than offset lease fees. Although IRD's probably have a 5-year life cycle for tax purposes, their real life is considerably shorter--probably on the order of 3 years. If the basis of a single IRD, say an HR-10-250, is $500 including installation (which is part of the basis), that means against the monthly income from the lease of say, $360 for three years, they will have a depreciation write down of $500.

People buy stock in companies because those companies are making money, or are expected to in the reasonably near future. Leasing equipment to customers at a loss doesn't improve the bottom line. :rolleyes:

There would be a similar scenario for other equipment.

[JWThiers]

There is no business model whatever that would justify "owning" depreciating assets. You want to own appreciating assets, and lease depreciating ones. Once DirecTV owns all of their IRD's, they will have one HUGE montly depreciation charge on otheir income statements which will more than offset lease fees. Although IRD's probably have a 5-year life cycle for tax purposes, their real life is considerably shorter--probably on the order of 3 years. If the basis of a single IRD, say an HR-10-250, is $500 including installation (which is part of the basis), that means against the monthly income from the lease of say, $360 for three years, they will have a depreciation write down of $500.

People buy stock in companies because those companies are making money, or are expected to in the reasonably near future. Leasing equipment to customers at a loss doesn't improve the bottom line. :rolleyes:

There would be a similar scenario for other equipment.
Think Schick and Gillette, sell the handles at a loss and make up for it selling blades at huge markups. Same goes here sell or give away the recievers and make up for it in programing costs.

[tivoupgrade]

I don't think whether or how this "direction" affects us (customers) would have been a major factor in the decision to move in this direction.

DirecTV is looking to grow market-share, and do it in a way that is as efficient for them as possible. Clearly, they've crunched the numbers, and they think that going towards this model will make more sense for them - after all, they are LOWERING the barrier to entry for gaining a new customer.

A new potential customer gets a receiver for "free" - just like they can do with a mobile phone, or a cable box. That puts DirecTV at something closer to "parity" with the cable company, than they are today.

Its not about US. ;-)

[lord-dogbert]

Well boys and girls, our old sat receivers sitting in the closet collecting dust will now be worth a whole lot more on ebay :-)

[tivoupgrade]

Well boys and girls, our old sat receivers sitting in the closet collecting dust will now be worth a whole lot more on ebay :-)

As will your TiVo/DirecTV DVR systems; especially those that are upgradable.

[herdfan]

), that means against the monthly income from the lease of say, $360 for three years, they will have a depreciation write down of $500.

People buy stock in companies because those companies are making money, or are expected to in the reasonably near future. Leasing equipment to customers at a loss doesn't improve the bottom line. :rolleyes:
Failed those finance classes didn't we? Large companies set up leasing companies specifically for the tax deductions. GE Capital comes to mind as a big one set up exactly for the purpose of providing its parernt with a paper loss. By depreciating the assets at a faster rate for tax purposes, the parent pays less taxes which boosts cash flow. Cash flow is the basis for companies profitability, not net income.

[rborden]

I agree... I am VERY frustrated with DirecTV's HD offering, and despite the fact that I am one of their top customers was recently forced to pay $600 for an HD Tivo, another $50 for upgrading my satellite, and STILL don't have a solution for getting locals over the sat and/or recording them. Then they are going to FINALLY have a solution sometime down the road, and it will likely just end up costing me MORE money.

I've been a die-hard DirecTV lover and anti-cable person for a long time, but I am SERIOUSLY considering making the switch soon.

Although, the move to NDS controlled hardware may end up benifitting them sometime down the road, I think how they are handling the transition is SERIOUSLY hurting them. They are falling pretty far behind in the offerings from Cable and DishNet.

Personally, if the CableCard tivo is offered for rent through Comcast, I will be gone in an instant. That is... if I don't switch before then.
Who "forced" you to pay $600.00 for the HD-DVR?

[tbeckner]

Why do you assume they won't take care of HR10 users? It may be a free upgrade!The DirecTV spokesman did say in the last two weeks that the HR10 to HR20 upgrade/conversion will NOT be FREE, but will be inexpensive for some customers.

[Adam1115]

The DirecTV spokesman did say in the last two weeks that the HR10 to HR20 upgrade/conversion will NOT be FREE, but will be inexpensive for some customers.

Just because it isn't FREE doesn't mean they aren't taking care of us.. could be next to free.. almost free to good customers, free if you cal retentions..

Remember, it's not just the receiver, theres a dish involved and installation to.

Could be that it's free but you have to buy the dish, or it's free but you have to pay for installation..

[SecureTalk]

The DirecTV spokesman did say in the last two weeks that the HR10 to HR20 upgrade/conversion will NOT be FREE, but will be inexpensive for some customers.

Free or inexpensive....will it be considered a leased receiver or a purchase?

[JWThiers]

Free or inexpensive....will it be considered a leased receiver or a purchase?
See title of thread, it will be leased.

[ljsss]

I have been on the fence about buying a HR10-250. It seems like now though, that I need to make sure that I buy one by 2/28 (assuming that I can buy it for close to $299). Otherwise, after that, I will be paying $299 for the same thing, except that I will not own it, right?

[Dan Collins]

There is no business model whatever that would justify "owning" depreciating assets. You want to own appreciating assets, and lease depreciating ones. Once DirecTV owns all of their IRD's, they will have one HUGE montly depreciation charge on otheir income statements which will more than offset lease fees. Although IRD's probably have a 5-year life cycle for tax purposes, their real life is considerably shorter--probably on the order of 3 years. If the basis of a single IRD, say an HR-10-250, is $500 including installation (which is part of the basis), that means against the monthly income from the lease of say, $360 for three years, they will have a depreciation write down of $500.

People buy stock in companies because those companies are making money, or are expected to in the reasonably near future. Leasing equipment to customers at a loss doesn't improve the bottom line. :rolleyes:

There would be a similar scenario for other equipment.A number of points you fail to take into account....

1) They are losing the money now, it is just going out as receiver sale subsidies, and so is part of Subscriber Acquistion Cost (SAC).

2) Corporations are measured on EBITDA (Earning Before Taxes, Interest, Depreciation and Amortization).

3) By changing the cost of reception equipment from a marketing expense (subsidies) to a depreciating asset they relocate the expense from before EBITDA calculation to after. This increases EBITDA.

4) Satellite and cable operator are both measured on the basis of SAC, with lower numbers being better, so again, eliminating hardware as a factor in SAC is beneficial.

5) SAC is a cost of doing business, and so can only be deducted against gross revenue. If expenses exceed revenue (i.e. you have an operating loss) the excess loss is "lost" - it has no effect on taxes. Depreciation, however, defers the "expense" to later years when you might have profits. Given the expected revenue model, this is very valuable to an operation like DirecTV.

Bottom line, this is beneficial to the balance sheet. Granted it is a bit of an accounting trick, but that is what accountants get paid for.

[taj2]

After thinking about this I don't think it is a bad thing if:

1. They swap out current customers premium equipment (read all HD Recievers/DVRS) and do not charge people a monthly fee that have spent considerable $$$ in the last year or two
2. They offer Home Media Option solutions other innovative features
3. They aggressively rollout HD channels in 2006 and 2007 making SD obsolete as far as DTV goes.

[formulaben]

As will your TiVo/DirecTV DVR systems; especially those that are upgradable.

I hope you're right.

[thepackfan]

After thinking about this I don't think it is a bad thing if:

1. They swap out current customers premium equipment (read all HD Recievers/DVRS) and do not charge people a monthly fee that have spent considerable $$$ in the last year or two
2. They offer Home Media Option solutions other innovative features
3. They aggressively rollout HD channels in 2006 and 2007 making SD obsolete as far as DTV goes.

1. I have not read here, where we won't be charged if they swap out, there is either a rental or a mirror fee. so the only thing I see is that I lost my $1000 unit, and they rented me one.

Hopefully I'm wrong in my thought process but I fear I'm not.

[tbeckner]

Just because it isn't FREE doesn't mean they aren't taking care of us.. could be next to free.. almost free to good customers, free if you cal retentions..

Remember, it's not just the receiver, theres a dish involved and installation to.

Could be that it's free but you have to buy the dish, or it's free but you have to pay for installation..FREE is FREE, not inexpensive. What I was pointing out is that the DirecTV spokesperson said that it will NOT BE FREE, but could be inexpensive for SOME CUSTOMERS.

Again, FREE is FREE, inexpensive is NOT FREE. Again we where NOT DISGREEING, just that you took exception the definition that INEXPENSIVE should mean FREE.

To tell you the truth, I really don't care what they charge for the HD "HR10 to HR20" upgrade, no matter what is costs it has been noted by DirecTV that it will not be FREE.

[taj2]

If they go to lease only does that mean for $5 per month I can get one of the new LCD tvs that they recently announced?

Or will DTV become like Rent-a-center and allow you to pay $50 per month for a TV. Perhaps I can get a couch and a Lazy Boy from them too.....

[lord-dogbert]

If they go to lease only does that mean for $5 per month I can get one of the new LCD tvs that they recently announced?

Or will DTV become like Rent-a-center and allow you to pay $50 per month for a TV. Perhaps I can get a couch and a Lazy Boy from them too.....

Beer dispenser as well :D

[SecureTalk]

See title of thread, it will be leased.

Thats what I thought.

So those of us who have purchased 10-250 DVR(s) will have to return our purchased equipment in exchange for a leased piece of equipment if/when we want to upgrade to the h20-250 MPEG 4 receiver?

[dswallow]

So those of us who have purchased 10-250 DVR(s) will have to return our purchased equipment in exchange for a leased piece of equipment if/when we want to upgrade to the h20-250 MPEG 4 receiver?
That has not been stated at all. The doomsayers are predicting it; like they predict everything as worst-case.

[bgtimber75]

No biggie. Fios should be in my area by mid year and I was thinking about switching anyway. This just motivated me even more.

[tivohaydon]

Changes I see... and some unintentional side effects that D* will have to deal with.

1) D* always gets a cancellation fee/penalty, very similar to cell providers
2) D* retains their equipment, unlike cell providers
3) Lease fees+acquisition fees to consumer will very likely exceed the cost of the receiver
4) Cost to the consumer to subscribe is not reduced
5) Increased pressure from consumers to "upgrade" to new receivers
(because they don't own it and ?don't? have to lay out cash for an upgrade)
6) "Hacking" your DVR just became entirely illegal
7) MPEG4 conversion costs rest mostly upon D*
8) TiVo fans which are D*'s most lucrative and loyal will likely jump ship once desirable content is MPEG4

I had a few more thoughts rattling through my head when reading this thread but can't recall them. Basically this whole thing is not good news for D* subscribers. I know I would never sign a 2 year contract for D* when the competition is month to month.

[Pearhead]

I fail to see why this move is such a big deal.

If you "buy" a hackable/upgradable subsidized unit, technically you do not own the equipment until your commitment is satisfied. Hence your mirror fee is the same as the lease fee and the upfront cost is virtually the same correct?. Semantics.

[toddeurope]

MPG4 has NO benefit at all, No better picture quality it's just a space saver on the hard drive.. Those that say MPG4 is a reason to get new equipment are they just misinformed? Am I wrong? Is it not just a way to compress and store digital video on a drive that takes up less space? I thought TiVo was the reason we all have DVR’s Who wants the new junk form direc tv? Tivos should be a rare commodity I’m keeping mine until it pukes than ill get it fixed..

[cheer]

DirecTV is now beginning to carry local-market channels in the local markets ("LiL") in high definition, but to get them you need an MPEG4-compatible receiver because they are being sent from the bird in MPEG4.

So it's not just a hard-drive-storage thing; it's a save-bandwidth-on-the-bird thing too.

[Lee L]

Yes, the space saved on the hard drive is just a side effect of the fact that they can get more info int eh same bandwidth over the satellite.


I would not be surprised if D* makes you send the HR10-250 back but I would not be surprised if they let you keep it either. If they do require it to be sent back, I would have to think seriously about that as I would just as soon pull teh drive and use it for something else if the deals they are giving anyway are good enough. IF they are not, I will have to consider cable I guess.

I know one thing, I no longer need to worry about whether my box has a bad HDMI ouput. ;) (I only have component in on my current TV so I have never tried it and it is one of the early ones)

[herdfan]

I fail to see why this move is such a big deal.

If you "buy" a hackable/upgradable subsidized unit, technically you do not own the equipment until your commitment is satisfied. Hence your mirror fee is the same as the lease fee and the upfront cost is virtually the same correct?. Semantics.
It is a big deal because under the previous scenario, after my commitment is over, the equipment is mine to keep. Under the new plan, even if I fulfill my 2-year commitment, I have to send the equipment back to them if I terminate service.

Given all the issues with users returning defective HR10-250's, can you imagine D* trying to keep track of all equipment coming back in? :eek:

[JWThiers]

I fail to see why this move is such a big deal.

If you "buy" a hackable/upgradable subsidized unit, technically you do not own the equipment until your commitment is satisfied. Hence your mirror fee is the same as the lease fee and the upfront cost is virtually the same correct?. Semantics.
The point is if you lease you don't own anything. If after the commitment is over I decide I want the latest and greatest I can get it with a commitment and then sell my old unit and further reduce the hit on my wallet by a few bucks.

Or if I decide to leave and pay the penalty, and decide to come back at a later time, I don't have ANY equipment cost, I already own it.

A better solution to this is off bother a lease option and a buy your own option. Of course then you would have different price points for each option. Basic box $50, $100, $200 for lease, buy with commitment, buy with no commitment. Give people a few choices and let them choose whats best for them. :eek:

[JWThiers]

I would not be surprised if D* makes you send the HR10-250 back but I would not be surprised if they let you keep it either. If they do require it to be sent back, I would have to think seriously about that as I would just as soon pull teh drive and use it for something else if the deals they are giving anyway are good enough. IF they are not, I will have to consider cable I guess.)
They can't't MAKE you return it. It is yours, NOT theirs. They could just stop sending MPEG-2 and make ALL of their equipment obsolete and force EVERYONE to leave or upgrade. That would PO a lot of people.

[llurgy]

I understand the leasing bit, but what I dont understand is the initial up front payment....what is this classed as? At the moment an upfront payment gets us a thing that we own. Under the new rules that same upfront payment gets us nothing??

If it were not for the upfront payment on the receivers we would be better off as we wouldnt have to pay for a maintenance agreement, but with the payment upfront we are buying the equipment but not owning it, that is crap because it means we dont own it so we cant hack it :(

[Lee L]

No, they cannot make you send it. I meant to say if they enticed you to send it back with a deal.

[Adam1115]

6) "Hacking" your DVR just became entirely illegal


EEK, good point. You just won the argument with me! Now I hate the lease idea!

[tbeckner]

I fail to see why this move is such a big deal.

If you "buy" a hackable/upgradable subsidized unit, technically you do not own the equipment until your commitment is satisfied. Hence your mirror fee is the same as the lease fee and the upfront cost is virtually the same correct?. Semantics.I am not sure that is completely correct. Agreed you will have to pay a cancellation fee, but you do not have to return the equipment. And I agree with others, depending upon how long you have the equipment, leasing may cost a lot more than buying.

[tbeckner]

Changes I see... and some unintentional side effects that D* will have to deal with.

1) D* always gets a cancellation fee/penalty, very similar to cell providers
2) D* retains their equipment, unlike cell providers
3) Lease fees+acquisition fees to consumer will very likely exceed the cost of the receiver
4) Cost to the consumer to subscribe is not reduced
5) Increased pressure from consumers to "upgrade" to new receivers
(because they don't own it and ?don't? have to lay out cash for an upgrade)
6) "Hacking" your DVR just became entirely illegal
7) MPEG4 conversion costs rest mostly upon D*
8) TiVo fans which are D*'s most lucrative and loyal will likely jump ship once desirable content is MPEG4

I had a few more thoughts rattling through my head when reading this thread but can't recall them. Basically this whole thing is not good news for D* subscribers. I know I would never sign a 2 year contract for D* when the competition is month to month.Good post, number 6 makes a difference to us TiVo owners, but the new R15, HR20, and new units will likely never be hackable anyway.

[JWThiers]

No, they cannot make you send it. I meant to say if they enticed you to send it back with a deal.
It would have to be a heck of a good deal for me to trade in my DTivo's and I haven't hacked them (yet). I have a fundamental dislike for lease deals in general, but thats a personal thing. So unless you are talking No upfront, upgrade all my current equipment (which I just got 2 new series 2 non-R10 DTivos 6 months ago and wasn't planning on upgrading anything until after I get an HDTV sometime in the future (probably a year or more)) and some free (or monthly credits for a period of time) stuff, there would be no incentive for me to switch.

[Wolffpack]

Good post, number 6 makes a difference to us TiVo owners, but the new R15, HR20, and new units will likely never be hackable anyway.
Never say never. But at least you added "likely"? :)

Have you seen what they're doing to iPods already?

[SteakMan]

I understand the leasing bit, but what I dont understand is the initial up front payment....what is this classed as? At the moment an upfront payment gets us a thing that we own. Under the new rules that same upfront payment gets us nothing??

If it were not for the upfront payment on the receivers we would be better off as we wouldnt have to pay for a maintenance agreement, but with the payment upfront we are buying the equipment but not owning it, that is crap because it means we dont own it so we cant hack it :(My thoughts exactly. It makes so little sense that I'm willing to bet someone cut and pasted the wrong spreadsheet into that release.

I'm sure that a few people would still pony up, but there is no way in hell that I'm going to spend $300 on a HD-DVR that I might have to give back to them. Especially when Comcast will give me the same with no up-front costs.

It has to be a mistake.

[lord-dogbert]

Good post, number 6 makes a difference to us TiVo owners, but the new R15, HR20, and new units will likely never be hackable anyway.

All hardware and software is hackable, given time...

[Pearhead]

It is a big deal because under the previous scenario, after my commitment is over, the equipment is mine to keep. Under the new plan, even if I fulfill my 2-year commitment, I have to send the equipment back to them if I terminate service.

Given all the issues with users returning defective HR10-250's, can you imagine D* trying to keep track of all equipment coming back in?

Keep? For why.....as technological artifact in your personal DVR museum? I'm all for collector items...but these new rigs bode to fall very short on the retro wow factor. The days of provider supplied OOB hack ability are numbered if not already gone. The units provided under this new plan (in my view) have and will have no more value than a Sci. Atl. descrambler. In two years, that D* box will be about as attractive as a pulse dial phone to 99% of the general public and 100% of the people that post here.

D* keep track? Just like P* they won't because they'll be no reason to.


The point is if you lease you don't own anything. If after the commitment is over I decide I want the latest and greatest I can get it with a commitment and then sell my old unit and further reduce the hit on my wallet by a few bucks.
The fact that it's a non-modifiable proprietary piece of equip. means you never "owned" it to begin with. I foresee very few (if any) customers for your wares.


Or if I decide to leave and pay the penalty, and decide to come back at a later time, I don't have ANY equipment cost, I already own it.
A better solution to this is off bother a lease option and a buy your own option. Of course then you would have different price points for each option. Basic box $50, $100, $200 for lease, buy with commitment, buy with no commitment. Give people a few choices and let them choose whats best for them.

When you come back…..The penalty fee is your cost of entry mate. And truth be told…it’s highly unlikely you’d want to even use your old “paid for” box anyway.

Does the new plan not allow for un-leased/unsubsidized equip.?





I am not sure that is completely correct. Agreed you will have to pay a cancellation fee, but you do not have to return the equipment. And I agree with others, depending upon how long you have the equipment, leasing may cost a lot more than buying.

Under their proposed entry fee structure and monthly fees……the difference (if any) is negligible.

What I'm hearing most in this thread right now is a bit of preconceived early adopter/early remorse. Hold the pre-orders gents.....Just sit back until March and watch the sparks fly. Chances weigh heavy that the entry cost will plummet and this entire discussion will be moot. Let's not get lost in our own bleeding edge smoke and mirrors...even in the short run....it's all just semantics.

[SecureTalk]

All hardware and software is hackable, given time...

The R15 is running a proprietary OS, unlike the Series 1 [and Series 2] TiVo which run Linux. I even run programms unrelated to the function of the TiVo on a couple of T-60s just to have a place to keep the programs that need to run non-stop a place to live. This allows me to upgrade and test modifications to my Linux boxes and not have to worry about downtime on the Linux servers. With the proprietary software of the NDS boxes, like the R15 it will be very hard [almost impossible] to get custom software running on a closed OS .....IMHO....

[JWThiers]

When you come back…..The penalty fee is your cost of entry mate. And truth be told…it’s highly unlikely you’d want to even use your old “paid for” box anyway.

Does the new plan not allow for un-leased/unsubsidized equip.?
Lets see, I had my old VCR for 15-20 years before I got rid of it, it still worked fine I just didn't use it anymore because I got a DTivo 4 years ago. I retired that DVR 6 months ago because I was able to get a good deal on 2 new DVRs to replace the old DVR and old regular non DVR box that I had in the bedroom. The non DVR box I have had since I joined D* in the early 90's (13 years or so). The only reason that was replaced was the wife wanted a DVR in the bedroom as well ass the TV room. Why am I not still using it? Because I don't have a place to put it.

What this show? Some people keep using the old stuff because it works fine. I plan on staying with D* until I get an HDTV. At that point I will have to decide IF I stay with D* and lease their HD DVR or I go with renting a DVR from the cable company or hopefully Series 3 Tivo will be out and get that and get that.

As far as the penalty fee being my cost of entry if I leave and want to come back well lets just say that is one more reason not to come back. The only thing I would really miss is SciFi Friday (Gotta have my Stargates and BattleStar, but I guess there is always DVD. and bit torrent)

Does the new plan not allow for un-leased/unsubsidized equip.?
As long as you do not add new equipment. If you do add the new equipment will be leased.

[Greencat]

Keep? For why.....as technological artifact in your personal DVR museum? I'm all for collector items...but these new rigs bode to fall very short on the retro wow factor. In two years, that D* box will be about as attractive as a pulse dial phone to 99% of the general public and 100% of the people that post here. .

I have 3 hacked Dtivo and I'm waiting to do my HR10-250. If I leave D* I plan on keeping the units as media servers and I hope to use the HR10-250 for OTA (don't know if this possible without guide data).

I went with D* becasue I liked the idea of owning. I wouldn't put these boxes in the same boat as pulse phones since they are very nice cheap computers for handling digital data.

[Dan Collins]

I understand the leasing bit, but what I dont understand is the initial up front payment....what is this classed as?Capitalized Cost Reduction...just like a car lease down payment.

There are a lot of assumptions being made with any supporting evidence. For example: You will be able to upgrade at will (I doubt that DirecTV will give you a new model receiver just because you want one).

You will not incur any repair costs (I lease my car, but I have to pay for any repairs).

They could very well be following the automobile lease model....

You have a zero to several hundred dollar upfront cost depending on the cost of the receiver being leased.

The total margin of your monthly payment (subscription plus "lease fee") pays off the cost of the equipment, with a profit to DirecTV.

If you cancel the lease early, you still have to pay off the depreciation of the equipment through the cancellation fee.

[MichaelK]

There is no business model whatever that would justify "owning" depreciating assets. You want to own appreciating assets, and lease depreciating ones. Once DirecTV owns all of their IRD's, they will have one HUGE montly depreciation charge on otheir income statements which will more than offset lease fees. Although IRD's probably have a 5-year life cycle for tax purposes, their real life is considerably shorter--probably on the order of 3 years. If the basis of a single IRD, say an HR-10-250, is $500 including installation (which is part of the basis), that means against the monthly income from the lease of say, $360 for three years, they will have a depreciation write down of $500.

People buy stock in companies because those companies are making money, or are expected to in the reasonably near future. Leasing equipment to customers at a loss doesn't improve the bottom line. :rolleyes:

There would be a similar scenario for other equipment.


Not sure I'm folowing you but if the choice is own the box or hand it to the customer then I think they would prefer to own it. Since the amounts the customer will be paying appears neutral I'm not sure how you can figure they wont want to still own the boxes.

Second their b ox churn is HUGE, this will significantly cost their expenses to buy boxes over and over again. Currently Directv is the largest STB buyer in the US (maybe the world). So even cutting the annual outloaw by 5 or 10% with recyled boxes will be afat money.

Last and most importantly, what makes sense in the real world and what makes sense in a world with taxes are 2 different things entirely. The way subscriber acqusition costs and hardware putrchases and ownership, etc, etc are handled for taxes all plays into these decissions. Honestly I canfigure it out at all, but i know it matters.

I own my own business- at the end of the year there is X amount in my checking account after I've paid all my bills for the year. In my head that's my annual profit (I believe wall street though calls it cash flow). But Quickbooks comes up with some differnt number all together (lets say Y) which i quess is the number that the stock analysts would go by as profit. Do you think X or Y shows up annplace on my tax forms? NOPE, the IRS says my profit was Z. Now I have to pay taxes on Z which then effects what is left in the Banx (X) and what quickbooks says (Y).

It's a big round and round mess. You go figure what all that means...I cant....LOL

It's easy to see how sometimes the tail will wag the dog.

[MichaelK]

FREE is FREE, not inexpensive. What I was pointing out is that the DirecTV spokesperson said that it will NOT BE FREE, but could be inexpensive for SOME CUSTOMERS.

Again, FREE is FREE, inexpensive is NOT FREE. Again we where NOT DISGREEING, just that you took exception the definition that INEXPENSIVE should mean FREE.

To tell you the truth, I really don't care what they charge for the HD "HR10 to HR20" upgrade, no matter what is costs it has been noted by DirecTV that it will not be FREE.

Can you aim me to the link? I have been away and missed that. LAst I saw it would be free for the western time zones with $99 for eastern at first. Once the west was done then east would also be free.

[MichaelK]

My thoughts exactly. It makes so little sense that I'm willing to bet someone cut and pasted the wrong spreadsheet into that release.

I'm sure that a few people would still pony up, but there is no way in hell that I'm going to spend $300 on a HD-DVR that I might have to give back to them. Especially when Comcast will give me the same with no up-front costs.

It has to be a mistake.


I just think it is the MSRP's

There are tons of ways and places to not pay the MSRP on the equipment we BUY now.

If I had to GUESS- I'd say everything but the HD DVR will be zero out of pocket. They already are so why would they make the real world out of pocket go up?

Currently SD boxes are free to buy, HD boxes are free (after MIR), and SD DVR's are free (after MIR). With all the boxes free I dont see anyone doesn't understand why they want them back.

The only catch currently is you are limited to one SD DVR and one HD box for free- (unless you make a deal) we'll need to see if the new sale prices will still be the same or not. I would hope they are smart enough to see that cable hands out leases HD and DVRs for free so directv would follow with as many as you want- but they haven't impressed me so far with their intelligence...


They still seem to be at a disadvantage to cable with teh HD DVR's but they are basically talking about the HR20 I would think and the retail of the HR10 dropped in half in about a year and the real world price dripped to a third for those willign to call retention. So I'd think over time the HD DVR will drop in price a bunch more too. I dont see myslef paying 2-300 bucks to lease so they will not get me but in a year or 2 if it's free (up front) to lease an HD DVR then I wouold consider them again...

[The Flush]

If they are going to lease an HD DVR that had been returned by a former customer, will the new used of the DVR pay the same up front cost as the original user? That would hardly seem fair to have to pay the same up front and monthly costs for a used box as for a new one.

In the end, I don't see DTV wanting many used boxes back. Especially of the EPA ever decides to regulate electronics waste disposal.

[MichaelK]

I have 3 hacked Dtivo and I'm waiting to do my HR10-250. If I leave D* I plan on keeping the units as media servers and I hope to use the HR10-250 for OTA (don't know if this possible without guide data).
....


the HR10 at least basically becomes a doorstop if it is not subbed to D* and connected to a dish to get permission to work. It will only allow one buffered Live tuner and playback of prerecorded stuff. it will not record anythign new without permission.

[MichaelK]

If they are going to lease an HD DVR that had been returned by a former customer, will the new used of the DVR pay the same up front cost as the original user? That would hardly seem fair to have to pay the same up front and monthly costs for a used box as for a new one.

In the end, I don't see DTV wanting many used boxes back. Especially of the EPA ever decides to regulate electronics waste disposal.


DTV will not want any old boxes back. Only stuff issued after March 1 which will be all their own new boxes (and old HR10) so they will not be taking the boxes back to throw away but rather to reuse. They have stated in their conference calls that they think they can save alot of money buy getting the boxes back and reusing them.

The first few months of the new program likely will be a mess handing out some older stuff but after maybe 6 months or so, they will only be handing out the D11(maybe D20 with mpeg 4), H20, R20, and HR20. All those boxes will be their own and likely will be good for a few years at least.


from this article:
http://www.leichtmanresearch.com/press/040704article.html

there annual churn goal is 16% (and they are above that now). Assuming they get it down to 16% and have 15million subs that's 2.4 MILLION subs leaving each year. If they get those boxes back that's huge. Lets assume that they only save $10 to redeploy an old box as compared to a new box (allowing for shipping , testing, and repairs, warehousing, etc thats still a savings of like 25 Million dollars a year.

Actually I think it's more then that- that only assumes one box per sub. I think the number is more like 1.7 or 1.8 boxes on average so it's more like 40 million dollars a year.

Even if they need to throw away half the boxes they get back they still would save 20 million a year and I think all my numbers above are big on the conservative side.

Who knows maybe they can use those millions to further subsidize the 'capital cost reduction' of the new leases....


In a nut shell- their box costs are HUGE. Just running the numbers above makes me wonder why the hell they waited so long to do something about it.

[Greencat]

When the wireless companies make changes to their contract it opens an avenue for subscribers to break the contract without any earlier termination fees.

I wonder what is in the fine print of the Directv commitment.

[tbeckner]

Never say never. But at least you added "likely"? :)

Have you seen what they're doing to iPods already?All hardware and software is hackable, given time...Actually have you seen the XBOX and PSP hacks? I agree, except DirecTV could shutdown the boxes that are hacked, just like Microsoft is shutting down the XBOXs that are connected to their external game play system (same as DirecTV boxes connected to their satellite, remember the ECMs). When DirecTV got into the TiVo machines, the TiVos had already been hacked years before and it was widely know. But with DirecTV moving to a lease base from a purchase base, they just might have a strong case to shutdown any hacked machines. One big difference, especially with HD equipment, there are HUGE concerns about DRM. So, even if the DirecTV DVRs are hacked someday, everyone leasing those boxes could be in for the "RIDE OF THEIR LIFE". The TiVos are and will always be a different story and of course almost all of them are purchased.

I noticed that on the Scientific Atlanta 8300 series (SA 8300, SA 8300 HD, SA 8300 Multi-Room, and SA 8300 HD Multi-Room) and the use of the eSATA Maxtor external hard drives (see weaknees.com), there are some very funny things going on with DRM.

Understand there are big changes coming and I would not be leasing a DirecTV DVR and hack it, you could be asking for big trouble. Currently it appears that appeasing the broadcasters and video content supplies is almost as important to DirecTV as their customers, so be pre-warned that a hacked "R15" or "HR20" could be a big problem (its not the same animal (not a TiVo, not previously hacked), not the same situation or time period (HD and DRM), and you will not own it if you lease it).

Read the FAQ: Weaknees Maxtor QuickView QVX Expander (http://www.weaknees.com/maxtor_qvx.php)

To sum it up: Today it is a different world, there are big changes afoot.

[dswallow]

Understand there are big changes coming and I would not be leasing a DirecTV DVR and hack it, you could be asking for big trouble. Currently it appears that appeasing the broadcasters and video content supplies is almost as important to DirecTV as their customers, so be pre-warned that a hacked "R15" or "HR20" could be a big problem (its not the same animal (not a TiVo, not previously hacked), not the same situation or time period (HD and DRM), and you will not own it if you lease it).
Like it or not, technically hacking your DirecTV DVR w/TiVo is against the rules, too.

And for that matter, the only thing about a lease will be that when you return the equipment it needs to be in the condition it was in when you got it. Don't think for a minute that a lease stops anybody from doing anything and that isn't reversible. People have been doing things in leased cars for decades and then undoing them when turning the vehicle in.

And as has been stated even in the DirecTV materials sent to dealers, sales are not stopped; they still exist. It's just that the commission structure related to new customers is designed for leases. It did not state no equipment could be sold. In fact, the equipment that is leased and sold comes from the same sources, if you consider the instructions DirecTV provided regarding how dealers complete the lease papers and get their money back. So up until the transaction between the dealer and the customer it appears the dealer is getting their stock for sale or lease exactly the same way they get it now.

[Wolffpack]

One other item to consider regarding the hacking of DTivos. Many choose this route only for functionality, not to copy programs.

I seldom find the need to copy a show to my PC and then burn it to DVD. I hack so I can get full Tivo functionaility from DTivos. HMO, MRV. I like controlling my 5 Tivos from my PC via a Web interface, maintain SPs and now showing. I have EtiVoWeb Server so I can watch my own recorded shows when I'm on the road via boradband. I like the ability to have my Tivos pad the start and stop times of programs when it doesn't conflict with other scheduled shows. I like being able to shift scheduled programs from one Tivo to another if the original Tivo has a schedule conflict.

None of these items I'm referring to should concern the broadcasters or studios. These are all items any self respecting DVR should provide "out of the box".

However, at this point it seems that manufacturers other than Tivo have a hard enough time just getting their units to perform basic DVR functions. Like record what you tell it to record.

Hacking to steal will still continue. But that's a small percentage compared to those that hack for functionality.

[sda3]

I guess this makes it much easier for them to "upgrade" our HR10s, That way we won't own them.

[satmaster]

The biggest way this changes things is if a customer cancels early. Under the current subscriber aggreement, if you return the equipment that you recieved when you began a commitment, they can't charge you a cancellation fee. Now they can, they've closed that loophole.


Thats not true. Have you read the current contract? It clearly allows DTV to charge a cancel fee even if you return the eq. It doesn't say anything about the EQ it only talks about the programming. The dealer can also charge you for the install if you cancel early.



DTV had to do this because they are being riped off by renters who order systems and do not keep them for a year and skip town. DTV needs to pick up all old eq and reuse it to reduce cost. This also stops resale of old DTV receivers after the customer cancels. Its a + for DTV all around.

[satmaster]

I wonder exactly what is included with the free installation for existing customers.

Since the installer only gets paid a small fee for a upgrade its likely only going to include running a wire to the new receiver and installing a multiswitch if needed.

[satmaster]

Well from what doug (pretty sure it was him) was saying earlier you should still be able to buy equipment outright. If this is true I seriously wonder if they are going to up the prices.

Sure they will. Right now DTV pays the dealer part of the EQ cost. When they stop paying him you will have to pay the entire cost yourself. No way he can sell it under cost. Cost for a Tivo used to be $599 not sure what it is right now. But look for them to be about $799

[MichaelK]

Thats not true. Have you read the current contract? It clearly allows DTV to charge a cancel fee even if you return the eq. It doesn't say anything about the EQ it only talks about the programming. The dealer can also charge you for the install if you cancel early.

.....


directv got sued a while back over the cancelation fees. To settle the suit they agree that anyone who wants out can just send back all their equipment and wouldnt be charged the fee.

[tbeckner]

Like it or not, technically hacking your DirecTV DVR w/TiVo is against the rules, too.

And for that matter, the only thing about a lease will be that when you return the equipment it needs to be in the condition it was in when you got it. Don't think for a minute that a lease stops anybody from doing anything and that isn't reversible. People have been doing things in leased cars for decades and then undoing them when turning the vehicle in.

And as has been stated even in the DirecTV materials sent to dealers, sales are not stopped; they still exist. It's just that the commission structure related to new customers is designed for leases. It did not state no equipment could be sold. In fact, the equipment that is leased and sold comes from the same sources, if you consider the instructions DirecTV provided regarding how dealers complete the lease papers and get their money back. So up until the transaction between the dealer and the customer it appears the dealer is getting their stock for sale or lease exactly the same way they get it now.Although at this point the "R15" and the "HR20" have not been hacked or if they have been hacked it is not public news. And I think you will agree that the HD DRM situation is a new situation, with paranoia running wild. So, there is the possibility that DirecTV could ECM hacked "HR20"s if they believe that the broadcasters would come down on them if the broadcasters thought that hacked "HR20"s where breaking DRM. Of course the same could be said about the "HR10", but then again I am not sure that anyone cares since the "HR10" is going to its GRAVE in a few years and will never likely be sold in large numbers, not like the "HR20" and newer units.

Again HD and DRM are the driving forces. And even if people can buy their "HR20", DirecTV might (future looking statement) make it a requirement for purchase that the user agrees not to hack the unit or they will be in violation of the contract and DirecTV could then issue an ECM, block or cutoff HD content, or request that the equipment be returned and the purchase price refunded. Actually there are many things DirecTV could do even with purchased equipment if they thought that the HD DRM was being broken or overridden.

One additional thought is that DirecTV appears to be giving future users of the “HR20” a way of expanding video storage by allowing an eSATA connector when was displayed on the back of the mock up model at CES 2006. Since most new DVRs are allowing eSATA expansion, like the Scientific Atlanta 8300 series, the Series 3 Standalone TiVo, and the DirecTV “HR20”, and currently these expansion hard drives are formatted in such a way that they conform to the DRM rules, we should assume that these manufacturers DO NOT want people getting inside of the boxes, and I think that can be a reasonable assumption. The days of the TiVo hacks could be going the way of the dinosaurs and likely is.

But I am not saying that there will not be hacks for these new boxes, I just believe that there will be a different response, very much like the response to the XBOX and PSP hacks. The response could be very much like the response to the “thief of signal” situation, especially since everyone is over the top on HD DRM. Just think about it.

[jcricket]

But I am not saying that there will not be hacks for these new boxes, I just believe that there will be a different response, very much like the response to the XBOX and PSP hacks. The response could be very much like the response to the “thief of signal” situation, especially since everyone is over the top on HD DRM. Just think about it.Supporting ESATA hard drive expansion takes care of about 1/2 the reason people "hack" their DirecTivos. I'd estimate about another 40% of the hacking being related to features that are available in standalone Tivos (mainly HMO, MRV & Internet Scheduling). It's a very small percentage (5-10%) that hack their DirecTivos to add on 3rd party or "advanced" features (TTG, Weather, RSS feeds)

So, if DirecTV wises up, they'll support hard drive expansion (ESATA would be fine by me) and include MRV, HMO, and Internet scheduling features. That would probably reduce the "hacking" by 90-95%. Throw in support for some "advanced" features (like weather, RSS feed and DirecTV-to-go) and there would be very little non-stealing hacking left to care about.

[dswallow]

Speaking for my own purposes, hacking the HR10-250 is principally to give me web access to scheduling and inquiring about scheduled programs (and the scripted endpad capabilities). While I have upgraded drives, I only went from 250GB to 300GB on one of the 3 units, it happened because I was replacing a dead drive and it was just cheaper to use a 300GB over a 250GB. I'm satisfied with the available space I get with 250GB, never having faced an issue with programs going away I wanted kept.

I did all the hacks to grab video, too, and used it about 3 times just to see it work, but haven't used it since; so it apparently isn't particularly important to how I use the DVR's. :)

[Wolffpack]

I agree Doug. Endpad helps, TWP helps with cleanup and scheduling. I've got 4 SDTivos and 1 HD and use TWP to maintain all my SP lists. I also love the conflict resolution feature of TWP and the ability for MRV. HMO, not so much. It's cool, but I don't have much use for it.

[PegO]

You all are forgetting that if these are "used" equipment then they will have been in someone elses home. I use to repair cable equipment and I for one would NOT want any used equipment! Not all people are neat and clean and many are bug infested. Sorry people but just say NO to used!

[jfh3]

DTV will not want any old boxes back. Only stuff issued after March 1 which will be all their own new boxes (and old HR10) so they will not be taking the boxes back to throw away but rather to reuse. They have stated in their conference calls that they think they can save alot of money buy getting the boxes back and reusing them.

This doesn't make any sense - in order to get boxes back, they have to lose customers. Unless they hope the customer that are returning multiple boxes will be replaced by multiple customers only wanting single boxes.

[dswallow]

This doesn't make any sense - in order to get boxes back, they have to lose customers. Unless they hope the customer that are returning multiple boxes will be replaced by multiple customers only wanting single boxes.
I'd guess the thinking on the matter is: If they must lose a customer, better to lose the customer and get the equipment back than to lose the customer and lose the equipment.

[morgantown]

I'd guess the thinking on the matter is: If they must lose a customer, better to lose the customer and get the equipment back than to lose the customer and lose the equipment.

I can see their logic. Just imagine the savings if they had done this since 1997 or so. Perhaps the rates would not gone up once or twice.

[Dan Collins]

As has been pointed out: THEY DON'T REALLY CARE ABOUT GETTING THE EQUIPMENT BACK!!

If you buy a receiver and through rebates and dealer incentives, the receiver is free, then DirecTV is out the money.

If you lease a receiver, and so pay nothing for it, DirecTV is still out the same amount of money.

Any receivers they DO get back, and which CAN be redeployed, is basically "found money."

Meanwhile, they get the depreciation deduction for all those receivers, the expense moves to after the EBITDA calculation, and their apparent Subscriber Acquistion Cost both goes down, and is modeled just like cable's.

It is a win for DirecTV on all fronts. The only downside is for the customer that wants high value premium equipment, like HD DVRs. They will have to pay the same upfront cost they did when they purchased, but can't recoup a portion of that investment on the used equipment market if they cancel.

[acomire]

I searched this thread and came up empty..

What is going to happen for people who purchsed their own equipment and also have the Protection Plan. I pay $8 a month for this plan and if I am now going to be able to get a replacement under a lease agreement for free is the Protection Plan going away or at least reduced in price?

I know it's not really for *free* since there is now a lease payment but you know what I mean.

Thoughts?

[MichaelK]

This doesn't make any sense - in order to get boxes back, they have to lose customers. Unless they hope the customer that are returning multiple boxes will be replaced by multiple customers only wanting single boxes.

they lose over 15% of their customers a year no matter how hard they try to keep them. WHy not get the boxes back from the subs who are leaving anyway?

single boxes, multple boxes, it doesn't matter. Fact is customers leave and this allows them to reuse some of the equipment those subs had.

[MichaelK]

As has been pointed out: THEY DON'T REALLY CARE ABOUT GETTING THE EQUIPMENT BACK!!

If you buy a receiver and through rebates and dealer incentives, the receiver is free, then DirecTV is out the money.

If you lease a receiver, and so pay nothing for it, DirecTV is still out the same amount of money.

Any receivers they DO get back, and which CAN be redeployed, is basically "found money."

Meanwhile, they get the depreciation deduction for all those receivers, the expense moves to after the EBITDA calculation, and their apparent Subscriber Acquistion Cost both goes down, and is modeled just like cable's.

It is a win for DirecTV on all fronts. The only downside is for the customer that wants high value premium equipment, like HD DVRs. They will have to pay the same upfront cost they did when they purchased, but can't recoup a portion of that investment on the used equipment market if they cancel.


Dan I agree that EBITDA and taxes and deprecitation all matter. I've said as much in my postings. But dont you think the tens of millions they will save annually in "found money" is also significant? I wonder if the savings will be apparent in their conference calls or SEC filings with balance sheets etc? I really dont know the numbers involved at all but getting back 3 or 4 MILLION boxes back a year to recylce has to be some significant money. My WAG of worst case is it saves them 30 to 40 million a year and maybe up to 200 million. Obvioulsy the returned boxes will be a fraction of that to start but in several years it could easily by several million boxes a year, easily.

[dswallow]

Dan I agree that EBITDA and taxes and deprecitation all matter. I've said as much in my postings. But dont you think the tens of millions they will save annually in "found money" is also significant? I wonder if the savings will be apparent in their conference calls or SEC filings with balance sheets etc? I really dont know the numbers involved at all but getting back 3 or 4 MILLION boxes back a year to recylce has to be some significant money. My WAG of worst case is it saves them 30 to 40 million a year and maybe up to 200 million. Obvioulsy the returned boxes will be a fraction of that to start but in several years it could easily by several million boxes a year, easily.
Somebody will have to pay to ship the boxes back, to inspect/test and possibly refurbish them, and then repackage them with all necessary extras. Then there's the potential added cost of shipping out replacements to people who receive refurbished/reused units that have problems.

Or they can raise Total Choice package prices $2-$6 and across 15,000,000 subscribers gain another $400-$600 million per year.

Or they can do both.

[SpankyInChicago]

Let's summarize:

DirecTV offer post 3/1/2006 for single HD DVR + single SD DVR:

- $300 upfront cost
- $4.99 / month lease fee for second receiver
- $5.99 / month DVR fee
- Minimum monthly package with locals: $44.99
- Monthly HD package: $9.99
- 2 year commitment w/ $300 pro-rated cancellation fee

Total over 2 years: $1883.04
Total over 4 years: $3466.08

Comcast offer in Chicago area:

- $0 upfront cost
- $19.98 / month for 2 DVRs (HD recording capable)
- Minimum monthly package with locals: $59.98
- Monthly HD package: $5.00
- No programming commitment

Total over 2 years: $2039.04
Total over 4 years: $4078.08

So, DirecTV still seems like a better deal if you plan on staying with a service for 2+ years.

Of course Comcast has special deals for the first 12 months if you switch from DirecTV. Also, the availability of a Tivo Series 3 for use with Comcast might make it more attractive. In addition if you buy Comcast cable you get great deals on high speed internet and phone service, so more variable to take into account with Comcast. But, bottom line is that in the most basic comparison, even with upfront costs factored in, DirecTV is still cheaper.

For me the question is whether or not for $12.50 per month extra over 48 months the opportunities with Comcast are better than with DirecTV. Right now I am much more impressed with the HD offering from Comcast than I am from DirecTV.

[formulaben]

Let's summarize:

DirecTV offer post 3/1/2006 for single HD DVR + single SD DVR:

- $300 upfront cost
- $4.99 / month lease fee for second receiver
- $5.99 / month DVR fee
- Minimum monthly package with locals: $44.99
- Monthly HD package: $9.99
- 2 year commitment w/ $300 pro-rated cancellation fee

Total over 2 years: $1883.04
Total over 4 years: $3466.08

Comcast offer in Chicago area:

- $0 upfront cost
- $19.98 / month for 2 DVRs (HD recording capable)
- Minimum monthly package with locals: $59.98
- Monthly HD package: $5.00
- No programming commitment

Total over 2 years: $2039.04
Total over 4 years: $4078.08

So, DirecTV still seems like a better deal if you plan on staying with a service for 2+ years.

Of course Comcast has special deals for the first 12 months if you switch from DirecTV. Also, the availability of a Tivo Series 3 for use with Comcast might make it more attractive. In addition if you buy Comcast cable you get great deals on high speed internet and phone service, so more variable to take into account with Comcast. But, bottom line is that in the most basic comparison, even with upfront costs factored in, DirecTV is still cheaper.

For me the question is whether or not for $12.50 per month extra over 48 months the opportunities with Comcast are better than with DirecTV. Right now I am much more impressed with the HD offering from Comcast than I am from DirecTV.


Yeah, what a sweet deal with DirecTV right now...and for all that money you save you get to enjoy no local HD! That is, unless you want to ditch your Tivo... :mad:

[jcondon]

That has not been stated at all. The doomsayers are predicting it; like they predict everything as worst-case.


Would be nice if DirecTV could clear the air and let us know the details.

If they don't upgrade my two Hr10-250s and dish for around $100 (and I OWN the new boxes) I will switch to FIOS-TV (coming real soon I think in my area) or cable.

Just not worth it to me to send back two boxes I spent around $2,000 for and then have to rent 2 new HD PVRs.

I am not saying I think DirecTV will do this to us but, who knows. They probably don't even know what they are going to do.

[jcondon]

I'd guess the thinking on the matter is: If they must lose a customer, better to lose the customer and get the equipment back than to lose the customer and lose the equipment.


But, after the 1 year commitment (under the current way of doing things) the box should be paid for. Who cares what we do with it. Sell it on Ebay or smash it with a sledgehammer.

Direct should have made a profit off a 1 year subscription and whatever the original buy price was.

[SpankyInChicago]

Yeah, what a sweet deal with DirecTV right now...and for all that money you save you get to enjoy no local HD! That is, unless you want to ditch your Tivo... :mad:

I am with you. I've been a DirecTV customer for 10 years. Only recently have I seriously considered cable as an alternative. Tivo Series 3 might just push me to cable.

(BTW - I do get local HD with my OTA antenna and my HR10-250).

[cheer]

I am with you. I've been a DirecTV customer for 10 years. Only recently have I seriously considered cable as an alternative. Tivo Series 3 might just push me to cable.
I seriously thought about that...but ultimately couldn't make the numbers work. If I go with Comcast, my bill would be about $10 higher with no DVRs, plus roughly $34/mo in Tivo fees (assuming the monthly rate for the S3 is the same), and that's not including the purchase price of four S3s. Plus it means dropping the receiver I'm paying for in my son's semi.

D* is going to have to do some insane rate hikes for me to consider Comcast, especially as my previous experience with Comcast was, well, awful.

Now when AT&T's U-Vision (or whatever they're calling it) arrives later this year, well, that might be another story. We shall see.
(BTW - I do get local HD with my OTA antenna and my HR10-250).
As will I soon...just ordered mine. I'm psyched.

[MichaelK]

Somebody will have to pay to ship the boxes back, to inspect/test and possibly refurbish them, and then repackage them with all necessary extras. Then there's the potential added cost of shipping out replacements to people who receive refurbished/reused units that have problems.

Or they can raise Total Choice package prices $2-$6 and across 15,000,000 subscribers gain another $400-$600 million per year.

Or they can do both.

they are obviolusly doing both- LOL

But back to the costs. Let's say it scosts them $50 a NEW box. You think it costs them more then $40 to pay for shipping back to them and have a minimum wage employee connect it to a tester for check out, then throw the failures in the trash and wipe down and repackage the ones' that are 100%? (and who knows minimum wage might be high- they might palletize them and ship them to china for rework at 3 cents each)

I have to think it saves them at least 10$ a box to refurb it as opposed to buying new. If refurbed boxes were NOT cheaper then why would rthey eplace warrenty boxes with new as it wouldn't be worth the effort- and many of the warrenty refurbs did have problems requiring repair to begin with. I'd have to guess half the boxes going back from lease (non dvr's) would be 100% fine. THere's just no way they dont save a ton of money by doing this that I can figure.

Hell it' more profitable to collect and refill simple plastic ink and toner cartridges then to make new ones. How cant a more complex electronic component not be cheaper to recycle?

[MichaelK]

But, after the 1 year commitment (under the current way of doing things) the box should be paid for. Who cares what we do with it. Sell it on Ebay or smash it with a sledgehammer.

Direct should have made a profit off a 1 year subscription and whatever the original buy price was.


that's just funny. Really think about it. Say they made $50 on you the first year but they can make (or save) another $50 to reuse the box. You think they are just going to leave that on the table? Look around at the way companies make money no a days- there's all kinds of schemes.

[MichaelK]

I seriously thought about that...but ultimately couldn't make the numbers work. If I go with Comcast, my bill would be about $10 higher with no DVRs, plus roughly $34/mo in Tivo fees (assuming the monthly rate for the S3 is the same), and that's not including the purchase price of four S3s. Plus it means dropping the receiver I'm paying for in my son's semi.

D* is going to have to do some insane rate hikes for me to consider Comcast, especially as my previous experience with Comcast was, well, awful.
....


it's not that tough for cable to make sense- just have comcast bundle in your internet and phone. Good chance the total cost is cheaper with comcast for the bundel then for directv plus interent plus phone.

[MichaelK]

Look, I'm no tree hugger, but doens't anyone else think it's disgusting that something like 3 MILLION boxes a year full of heavy metals and all kinds of other toxic pollutants are essentially going to the landfill? How many do you think get sold on ebay in a year- a million? Maybe another million get tossed in a closet to get reused later down the road when people resub. THat's still like a million getting tossed away. Are we such a disposable society that no one thinks that's nasty?

Even if it's a wash it helps the environment.

I know that clearly isn't Directv's concern but it's sure a nice benefit.

[cheer]

it's not that tough for cable to make sense- just have comcast bundle in your internet and phone. Good chance the total cost is cheaper with comcast for the bundel then for directv plus interent plus phone.
That presumes that you need/want internet/phone from cable.

Right now my Internet is via a fixed wireless provider. The throughput is better, the customer service is leagues better, and the rate is competitive.

As for phone...I work for a phone company. Local phone service for me is practically free. But if it wasn't, I'd just as soon get VoIP, which'll be less than what Comcast sells phone service for. (Plus, like with Cable TV and Internet, Comcast's customer service for the phone stuff around here is absolutely horrid. I spent six months trying to clear up billing blunders on their part.)

Even if I could save $10 on my Internet (which is about all I'd save) and even if the phone service saved me $20 (which it won't, and it wouldn't even if I didn't get my employee discount, but this is for the purposes of this discussion), cable is still more expensive.

Quite simply, if you like to have multiple DVRs, cable's pricing structure will eat you alive. If you'd prefer standalone Tivos, then you have the cost of those subscriptions to add in, plus whatever you might pay for the boxes.

--chris

[MichaelK]

That presumes that you need/want internet/phone from cable.

Right now my Internet is via a fixed wireless provider. The throughput is better, the customer service is leagues better, and the rate is competitive.

As for phone...I work for a phone company. Local phone service for me is practically free. But if it wasn't, I'd just as soon get VoIP, which'll be less than what Comcast sells phone service for. (Plus, like with Cable TV and Internet, Comcast's customer service for the phone stuff around here is absolutely horrid. I spent six months trying to clear up billing blunders on their part.)

Even if I could save $10 on my Internet (which is about all I'd save) and even if the phone service saved me $20 (which it won't, and it wouldn't even if I didn't get my employee discount, but this is for the purposes of this discussion), cable is still more expensive.

Quite simply, if you like to have multiple DVRs, cable's pricing structure will eat you alive. If you'd prefer standalone Tivos, then you have the cost of those subscriptions to add in, plus whatever you might pay for the boxes.

--chris


that's why a wrote "good chance" its chepaer and not certainly its cheaper . We cant all work for the phone company.

Comcast likely charges you for VOIP (i think that's what all cable sells as phone?) at a similar rate as the other major providers which is essentially cheaper then what most people pay for unlimited long distance. Paying anything to the local phone company is starting to look like a waste. Can you get discount LD too from your employer? If not might just be cheaper (if your lond distance is high enough) to get VOIP on top of your fixed wireless rather then pay even a few bucks for a wired line plus long distance from a traditional player.

multiple DVR's isn't as bad as you make it either. WIth Directv you pay ~5 for first DVR fee and then ~ $5 each addtional outlet so it's $5 a box. Cable charges 10 or 12. By itslef that is alot but you need to look at the complete cost to see what is going on.


Service, quality, and reliability all factor in too- but we were discussing pricing.

Obviously not for everyone but for a good portion of the population getting a bundle from cable (or TELCO like FIOS) can possibly compete nicely with seperate pricing which includes Directv's TV offering. It seems to make more sense for people getting more premium content from Directv in particular.

To make accross the board statments one way or the other That either Directv is great or cable is great is not helpfull. In some cases Directv is much better, in other cases the local cable bundle is much better, and in still other cases it's a wash.

TO be clear I still have Directv, and get phone and overprices DSL from Sprint. So obviously Directv isn't the anti-christ. Basically I stick around for TIVO and the quality and service iissues that cable seems to have. But if TiVo can pull of the series 3 then I've looked and it's around $10-$20 cheaper for me to go for my cable bundle PLUS 2 TiVO monthly DVR fees then to stick the way I am. AND with cable I will get a much better HD offering.


(PS who knows what effect everyones annual prcie increase have here too- Directv just jacked theirs up but sounds likecable might have been even higher?)

[cheer]

that's why a wrote "good chance" its chepaer and not certainly its cheaper . We cant all work for the phone company.
My example was assuming I didn't work for the phone company.
Comcast likely charges you for VOIP (i think that's what all cable sells as phone?) at a similar rate as the other major providers which is essentially cheaper then what most people pay for unlimited long distance.
No it's not VoIP, or at least not really. The pricing model is similar to traditional phone service, though it is generally cheaper than the local ILEC charges. But it's not as cheap as, say, Vonage or AT&T CallVantage.
Paying anything to the local phone company is starting to look like a waste. Can you get discount LD too from your employer? If not might just be cheaper (if your lond distance is high enough) to get VOIP on top of your fixed wireless rather then pay even a few bucks for a wired line plus long distance from a traditional player.
Yeah, I do get a steep discount on LD, but generally I just use my cell phone for LD anyway. And if I get the VoIP package from my employer, I can still apply my discount to it, and it would certainly be cheaper still than what I've got now. But regardless...anyone can get, say, Vonage and get cheaper phone service than Comcast provides.
multiple DVR's isn't as bad as you make it either. WIth Directv you pay ~5 for first DVR fee and then ~ $5 each addtional outlet so it's $5 a box. Cable charges 10 or 12. By itslef that is alot but you need to look at the complete cost to see what is going on.
Agreed. But I did just that. I compared what I am paying now to what I would be paying if I switched to cable. If I go with Comcast's DVRs, my current bill would increase by $40, and that includes dropping from five receivers to four (because my "fifth" receiver is in my son's semi). And then I give up Tivo functionality as well.
Obviously not for everyone but for a good portion of the population getting a bundle from cable (or TELCO like FIOS) can possibly compete nicely with seperate pricing which includes Directv's TV offering. It seems to make more sense for people getting more premium content from Directv in particular.
Possibly, though the only "premium" content I get right now is HBO. I think my DVR-addiction has a lot to do with it, too. I don't think that's typical -- in fact, I know that it is not. But just looking at Comcast's package pricing here, it's hard to consider them competitive.

Comcast's "Digital Classic" package is $59.98/mo. That doesn't include all the channels I get now, but it seems to include all the ones I watch. Anyway, add a DVR fee and three additional digital outlets and it jumps to $87.94 -- and I haven't even added in HBO yet. And that's with only a single DVR. My monthly bill, meanwhile, for D* is $82.94.

There's just no way to make the numbers work out in Comcast's favor.
To make accross the board statments one way or the other That either Directv is great or cable is great is not helpfull. In some cases Directv is much better, in other cases the local cable bundle is much better, and in still other cases it's a wash.
Wasn't aware that I did...was merely highlighting my situation.
TO be clear I still have Directv, and get phone and overprices DSL from Sprint. So obviously Directv isn't the anti-christ. Basically I stick around for TIVO and the quality and service iissues that cable seems to have. But if TiVo can pull of the series 3 then I've looked and it's around $10-$20 cheaper for me to go for my cable bundle PLUS 2 TiVO monthly DVR fees then to stick the way I am. AND with cable I will get a much better HD offering.
No question...if I could save money by moving back to cable, I'd have to at least consider it.

I was merely trying to point out that (A) in my situation, even forgetting my phone discount, there's no way Comcast can save me money, and (B) to be honest, I shouldn't have to buy a bunch of crap from Comcast that I don't want just to get reasonable cable TV pricing.

[MichaelK]

...
....
No it's not VoIP, or at least not really. The pricing model is similar to traditional phone service, though it is generally cheaper than the local ILEC charges. But it's not as cheap as, say, Vonage or AT&T CallVantage....

.

since you work for the phone company- can you explain what it is cable is selling for 'phone service'. They never are clear but i just assumed it was VOIP over the broadband line they were selling. Around here they sell it for $39 a month including unlimited calling in the 50 US states. Plus I dont think they have to charge taxes or fees like real phone service. I even wonder if it's just rebranded VOIP service from vonage or someone? I'd like to understand so I have all the facts when/if TiVo launches the Series 3



....
I was merely trying to point out that (A) in my situation, even forgetting my phone discount, there's no way Comcast can save me money, and (B) to be honest, I shouldn't have to buy a bunch of crap from Comcast that I don't want just to get reasonable cable TV pricing.....


agreed- I dont know that I much like the prospect of trusting the cable nitwits with my phone line just to get cheap TV. If I didn't have Sprint as my crappy ass ripoff ILEC for my DSL source I dont know that i'd like to trust them with my broadband either.

Didn't mean to imply that YOU were saying that cable is always cheaper- I just wanted to point out to anyone reading that one cant make assumptions one way or the other. One needs to look at the specifics of the providers in thier own town. I'm not even clear Comcast has one rate sheet for all their franchises.


(come to think of it part of the reason it would work out for me to be cheaper with cable is Sprint sucks so bad HERE- they have like 10 or 20 towns in NJ surrounded by Verizon for hundreds of miles- THey treat us like red headed step children and I'm sure it will only get worse now that they get spun off from the mothership- If verizon was my ILEC like the people in the next town over Cable would need to cut their rates a bunch more to match the cheap FIOS or DSL interent pricing that I see for Verizon on TV)

[smark]

since you work for the phone company- can you explain what it is cable is selling for 'phone service'. They never are clear but i just assumed it was VOIP over the broadband line they were selling. Around here they sell it for $39 a month including unlimited calling in the 50 US states. Plus I dont think they have to charge taxes or fees like real phone service. I even wonder if it's just rebranded VOIP service from vonage or someone? I'd like to understand so I have all the facts when/if TiVo launches the Series 3


Comcast Digital Voice is a form of VoIP but instead of using the more or less public internet, it travels alone our own backbone so we can have a very high QoS without having to deal with packetloss, latency and such.

[cheer]

since you work for the phone company- can you explain what it is cable is selling for 'phone service'. They never are clear but i just assumed it was VOIP over the broadband line they were selling. Around here they sell it for $39 a month including unlimited calling in the 50 US states.
No it isn't VoIP -- it's digital phone service on the cableco's network. It's not IP-based, just digital signalling, and it "appears" to the customer like normal dial tone.

However, Comcast (and, presumably, others) are looking to replace it with actual VoIP service. VoIP requires broadband Internet (the older digital phone service didn't), but is cheaper and a lot more flexible in terms of whiz-bangy features like web access to voice mails, etc.

You can find VoIP service for pretty cheap. AT&T's CallVantage is at the higher end of the pricing ladder (though generally very highly rated) at $29.95/mo for unlimited local and LD. Vonage is $24.95/mo for same.
Plus I dont think they have to charge taxes or fees like real phone service. I even wonder if it's just rebranded VOIP service from vonage or someone? I'd like to understand so I have all the facts when/if TiVo launches the Series 3
Actually, yes they did/do have to charge typical telephone taxes/fees on the digital phone service for the most part. VoIP seems to be a different thing so far. Give the government time. :)
agreed- I dont know that I much like the prospect of trusting the cable nitwits with my phone line just to get cheap TV. If I didn't have Sprint as my crappy ass ripoff ILEC for my DSL source I dont know that i'd like to trust them with my broadband either.
I can't even get DSL (other than horrid IDSL) because I'm too far from the CO, even though my ILEC is the "new" AT&T.
Didn't mean to imply that YOU were saying that cable is always cheaper- I just wanted to point out to anyone reading that one cant make assumptions one way or the other. One needs to look at the specifics of the providers in thier own town. I'm not even clear Comcast has one rate sheet for all their franchises.
Nope, not at all...and it's even hard to figure out from their web site what all of the rate choices are. WHY oh WHY do companies make it hard to find out what their products cost? Gahhh.

Keep in mind too that more choices are coming. Verizon is, of course, rolling out FIOS which ultimately will offer phone, Internet, and (non-IP) TV. The "new" AT&T will be rolling out VDSL-based Internet/phone/IPTV. Etc.

[cheer]

Comcast Digital Voice is a form of VoIP but instead of using the more or less public internet, it travels alone our own backbone so we can have a very high QoS without having to deal with packetloss, latency and such.
The newer Comcast Digital Voice product is VoIP-based, but the older Comcast Digital Phone service (as originally rolled out by AT&T Broadband) isn't/wasn't...

Oh, and you can't have QoS without packet loss; that's an oxymoron. :) And a private network helps with latency, but only to a point.

[jcondon]

Sorry I fail to see the humor. I paid $1000 a box (x2) stuck around for over a year, paid them 80-100 each month. I did not lease these boxes. I did get $250 in credits and 6 months of HBO for I think $5. But, if they didn't make money off my account for the 5 years I had it not sure how they stay in business.

I also bought my car. I am sure Acura would love to have it back for nothing and sell it as a recertified car. But, this isn't a lease either.

I personally don't care much about what they do going forward (Past giving me two MPEG4 DVRs) with NEW equipment. Lease, rent, sell, or give it away.

But, if they expect me to just turn these over and start leasing the new stuff not going to happen. I paid for the two HDs in these things. They are mine. The rest of the box maybe junk at some point but, the HDs I can use for something. 250gig drives are worth something still.


that's just funny. Really think about it. Say they made $50 on you
the first year but they can make (or save) another $50 to reuse the box. You think they are just going to leave that on the table? Look around at the way companies make money no a days- there's all kinds of schemes.

[smark]

The newer Comcast Digital Voice product is VoIP-based, but the older Comcast Digital Phone service (as originally rolled out by AT&T Broadband) isn't/wasn't...

Oh, and you can't have QoS without packet loss; that's an oxymoron. :) And a private network helps with latency, but only to a point.

Of course that is being nitpicky :), but the private network does improve our latency. I have yet to experience nor have heard of issues of delays and such in speaking with others like other VoIP providers which I experienced here and there with Packet8. Main problem I had with Packet8 was the occasional issue of it just dropping a call after about 20 min.

Also I'm aware of what our old digital phone was since I work for Comcast. :)

[cheer]

Of course that is being nitpicky :), but the private network does improve our latency. I have yet to experience nor have heard of issues of delays and such in speaking with others like other VoIP providers which I experienced here and there with Packet8. Main problem I had with Packet8 was the occasional issue of it just dropping a call after about 20 min.
Oh no question, a private network (unless built/designed by morons) will outperform the Internet. I was just commenting that other things can affect latency. (Distance, for example...which is why there will likely never be a viable satellite-based Internet service. Unless someone works out how to exceed the speed of light, anyway.)

But with a private network, you can do end-to-end QoS, which is impossible on the Internet. I'm not sure about all of the VoIP providers, but I know AT&T tries to do some QoS at the ingress.

I did some beta testing on our VoIP service -- we were using our consumer VoIP in a trial for our telecommuting employees' work lines. I never had a dropped call. I did have a problem early on with the POS D-Link VoIP router we used, but the replacement Linksys pretty much eliminated all of my issues.

The biggest issue I had after that was that there's no way (that I've seen) to order any of the consumer VoIP services without call waiting, and for a business line call waiting is just tacky.

Ah well. :)

[newsposter]

shucks Dish now has starz HD. Where's directv now? :)

[Bill Ball]

Dumb move on D*'s part. It just makes it easier for a person to change providers as they haven't locked themselves in by buying equipment.


Basswackwards from my POV. I went with cable HD because I would not accept a $1000 equipment outlay versus $10/ month. It would take 8 years for the two to even out. In the first two years I have been upgraded to better cable DVR boxes twice for free.

So, going to the lease program makes the decision based on other factors. Wouldn't you know it, though, D*TV went and screwed up in another way. My wife and daughter are absolutely wedded to the TiVo interface and hate the cable HD box. This year Comcast is going TiVo and D*TV stupidly is giving it up. So, we'll be dropping the D*TV standard def programming we kept for TiVo and staying with Comcast. I've been wanting to cancel DirecTV since I got the Comcast HD box, but my wife wouldn't let me. Later this year she will demand we drop D*TV.

[rickwms]

Is this a good thing or a bad thing?[/QUOTE]
Your right Selena was the best.
Here is what I wrote Directv:

Your decision to move to the lease business means I may as well go to cable.
I like to touch my equipment and upgrade it if I want to, but DIRECTV is killing that freedom.
Truly you are not making a good business decision since unless I stock up on receivers now for the future I’m stuck with your choices.
Hard drives are cheap and to say we will give you a 40 or 80 gig drive when for a few dollars more it could be double to triple the size. This is why I want to own my own receivers so I make them the size I want and save all of the shows I want.
Anyway I know my thoughts are useless on a corporation that doesn’t think with its head but the dollar is GOD for you.
I just installed my high def hr10 250 and I liked it but this news I found by accident today destroyed my enjoyment. Why haven’t we received any notification or announcements about this? I would have thought differently about the upgrades I have done and I’m planning to do.
This better not include a mandatory installer to come to my house.
My 1 cent since you will probably take my last dollar.

[kndust]

Dumb move on D*'s part. It just makes it easier for a person to change providers as they haven't locked themselves in by buying equipment.



well why don't you go back to c'band with the big 10' dish then you can do what you like it is a dying bred maybe you can start a come back for it. dtv is weeding out the dead beats

[kndust]

You can still buy the equip but you will have to pay full price for from now on no discounts and no rebates

[kndust]

So does this mean there is no more 1 or 2 year commitment required if you lease the equipment?








yes you will be subject to a 1yr commitment due to the fact that they are offering it at $0.00 but if you chose to pay for the mover's program there is no commitment and they tell you that when you call for the mover's

[fachauncie]

I just got an R-15, not realizing that Directv doesn't make the "tivo" brand boxes anymore. I'm obviously going through some adjustment problems (switching the 2 tuners). I have noticed that the program guide data is not existent within 3 days plus. Is this a common problem or is this unit very slow in downloading the program information? The guide can go up to 14 days, but the infomation is not there.
Does anyone else have this problem?

[JWThiers]

I just got an R-15, not realizing that Directv doesn't make the "tivo" brand boxes anymore. I'm obviously going through some adjustment problems (switching the 2 tuners). I have noticed that the program guide data is not existent within 3 days plus. Is this a common problem or is this unit very slow in downloading the program information? The guide can go up to 14 days, but the infomation is not there.
Does anyone else have this problem?
The R-15 is not generally not talked about in this forum (aside from bashing of course :D ) (it doesn't have Tivo) but if you try DBSTalk (http://www.dbstalk.com/index.php?) I'm sure you can get help. Unless anyone reading also has an R-15 and knows off the top of their heads.

[bamakid]

Interesting reading I must say since FiOS was installed at my house for land line and Internet yesterday. Was told 2 months the TV will be offered and I was thinking too bad I have 2 TIVO's and 2 other boxes I have made investment in currently. IF this is true maybe switching to FiOSTV will be a snap and there are 20 channels of HD for my HD TV without having to buy an expensive HD TIVO for D*.

Thanks for posting the info.

[SpacemanSpiff]

Be Carefull of what you lease and who you lease from.... (http://www.jsonline.com/news/metro/jan06/388195.asp)


She won't be holding her phone anymore
Posted: Jan. 28, 2006


Jim Stingl
E-MAIL | ARCHIVE


After she dumped her AT&T long-distance service, Paula Galaviz found it odd when the company sent a bill to her Watertown home.

When she looked at the fine print and learned what it was for, she was astounded.

"Leased equipment," it said. "Traditional rotary telephone."

Wait a minute, she thought. The one that's been in a box in the basement for the better part of a decade? That rotary telephone? The white wall-mount model that's turned more yellow over time?

AT&T wanted her and her husband, Sam, to send them $14.48 - that's $4.45 a month plus tax - for three more months of leasing the dinosaur of a telephone.

'Rented' Rotary Phone



Photo/Jeffrey Phelps

Paula Galaviz was paying $4.45 a month for an AT&T phone she hadn't used in years.

Advertisement

Hold the phone, Paula thought. I haven't used that clunky thing in years. Hey, how long have I been paying for it?

So she grabbed a modern touch-tone phone and called the customer service number on the bill.

"Would you like to discontinue the contract?" the woman on the other end of the line said.

Of course, Paula replied. I haven't used the phone in, like, forever.

OK, the woman said, then you owe us $17 for the telephone. It's an equipment recovery charge.

"I said, 'I didn't say I don't have the phone. I have the phone. It's in a box in the basement.' "

The woman said she would send out a mailer for returning the phone.

"I said, 'You want that heavy old phone back?' " Paula said.

Yes. Giant AT&T was willing to pay the postage to reclaim the outdated, clunky, heavy, yellowish, rotary-dial, wall-mount phone. The mailer arrived last week.

......more story in the link.


I guess there's more than one way for a company to make money with a lease.

[tbeckner]

The R-15 is not generally not talked about in this forum (aside from bashing of course :D ) (it doesn't have Tivo) but if you try DBSTalk (http://www.dbstalk.com/index.php?) I'm sure you can get help. Unless anyone reading also has an R-15 and knows off the top of their heads.I have been over to the DBSTalk forum many times in the last two months to review the "Other DVR", and I am not here to gloat, but I cannot really express my overbearing joy of being an owner of four DirecTV TiVos.

[formulaben]

I have been over to the DBSTalk forum many times in the last two months to review the "Other DVR", and I am not here to gloat, but I cannot really express my overbearing joy of being an owner of four DirecTV TiVos.

I'm happy for you, but I wonder how joyous you'll be when you're ready for HDTV... :rolleyes:

[tbeckner]

I'm happy for you, but I wonder how joyous you'll be when you're ready for HDTV... :rolleyes:I am not planning on going to HDTV until sometime in 2009, because I waiting for the technology to stablize and the prices to drop.

I have always been a somewhat early adopter (some examples are Sony Betamax 1976, Amana RadarRange (Microwave) 1976, PC 1983, DirecTV 1994, TiVo 2000), but HDTV for me is still far too early in its progression to adopt in any form. I could adopt HDTV before 2009 if progress is made in the industry and pricing of LCD TV's drops like it should in the next two years. But again, currently the price point is not right and the amount of content has not reached the fallover point.

And a little additional information may be needed, because what even makes me happier with my DirecTV TiVos, is that my HDVR2s have been hacked for MRV (Multi-Room Viewing) and I use MRV almost everyday.

[formulaben]

I'm right there with you, but I can't wait. Too many good games to watch in HD and I've since made the investment with the TV. You could argue I screwed myself on that one, but when friends and neighbors have HDTV, I just can't stand to not have it.

[tbeckner]

I'm right there with you, but I can't wait. Too many good games to watch in HD and I've since made the investment with the TV. You could argue I screwed myself on that one, but when friends and neighbors have HDTV, I just can't stand to not have it.I have to agree with you, the one major reason that I would have to make an investment in HDTV today, is football (NFL and college), but for the same reason that quit signing up for NFLST, is that the cost benefit ratio wasn't there any longer. I signed up for NFLST the first few years it was offered, but when the price went up and I got tired of the blackouts, and I had the distant network feeds anyway, I just looked at the cost to benefit ratio and dropped NFLST.

When the HD equipment costs come down (and the whole world is switching to LCD TV's, which is coming soon), I will look at the then existing HD technology (TV, DVR, etc), and the amount of HD content (channels and programming) beyond football and if it makes sense I will make the jump. But currently FOR ME it is not there yet.

I agree that it is hard to watch a football game on a 42" (or larger) TV in HD at a friends house and come home to a 32" TV and watch it in SD.

You could argue I screwed myself on that one, but when friends and neighbors have HDTV, I just can't stand to not have it.I would NOT say that you screwed yourself by buying into HD, the picture is great. I watched a demo of HDTV all the way back in 2000 at a Best Western where I was staying while working on a project and I to say it was great even back then. A month later I bought my first TiVo and connected it to one of my Sony DirecTV receivers at the motel (yes, I had my own DirecTV antenna at the motel).

In fact, if you watched Extreme Makeover Home Edition three weeks ago, about the Kirkwood Family, the motel they where staying at was the "Best Western Wesley Inn of Gig Harbor" is where I saw the HDTV demo and where I stayed at for over four years while working on a project, with my DirecTV antenna out front.

[formulaben]

I agree that it is hard to watch a football game on a 42" (or larger) TV in HD at a friends house and come home to a 32" TV and watch it in SD.

It's even worse coming home to a 56" DLP and watching stuff in SD.... :eek:

[RonMan]

Hello everyone,
Yes Im new here. Ive been lurking and trying to read as much as possible. (which is hard on a 28.8 connection). Please forgiveme if someone else has provided this info.

I just left a friends place who is a d* retailer. I was trying to get an HD DVR before the lease program. He can no longer order new equipment but told me about the leasing stuff. I took the opportunity of reading the new lease info provided by D* to their retailers. I didnt look over everything, but went straight to the HDDVR offer for NEW customers only (Exising customers were not mentioned) New customers would be eligible to receive an HD DVR for ONLY $399.99 after a $100.00 mail in rebate.

Let me get this straight. You're still gonna pay full price for something that will never be yours? As far as I could tell there would be an additional charge built into your subscription that would cover your monthly leasing charge. So its gonna cost you even more.

I wonder how bad existing customers are gonna get hammered if this is the best they can do for new guys. What is up with d*?

[newsposter]

I am not planning on going to HDTV until sometime in 2009, because I waiting for the technology to stablize and the prices to drop.

I have always been a somewhat early adopter (some examples are Sony Betamax 1976, Amana RadarRange (Microwave) 1976, PC 1983, DirecTV 1994, TiVo 2000), but HDTV for me is still far too early in its progression to adopt in any form. I could adopt HDTV before 2009 if progress is made in the industry and pricing of LCD TV's drops like it should in the next two years. But again, currently the price point is not right and the amount of content has not reached the fallover point.
.

I"m assuming you are saying because LCD is too expensive now for a big screen, as well as the HDtivo / hd dvr and only 3 hrs of prime time per night, that that's pretty much why you wont switch now. Also it seems that you have your heart set on LCD. Will you still want lcd when a new technology comes out in 2009? If so, then I can understand waiting because lcd should be rock bottom by then. But if not, heck, it only takes a cheap crt with tuner to get 100% free hd :)

And as far as content, i can barely keep up with what I have now. If they ever would make 'everything' hd, I'd have a serious problem. Then again, there is no show I don't watch now just because it's only in SD. But still, i'm betting I'd want more if certain things were in HD and I'd have to double the amt of time in front of the tube.

[Jabberer]

OLED is what I'm waiting on. When I can get a 50" OLED for $499, I'll jump right on that bandwagon! ;)

As for all the leasing business, I see it as pretty much a wash. However, I will say, one of the things I liked about apartment living over owning a home as I do now is when things broke, I simply called up and someone came by to fix it.

[SteakMan]

As has been pointed out: THEY DON'T REALLY CARE ABOUT GETTING THE EQUIPMENT BACK!!I lost two cable boxes when I moved and had to pay AT&T $700 for them. I couldn't afford that at the time so they sent it to a collection agency. Do you think D* is going to walk away from that kind of revenue?

[tbeckner]

I"m assuming you are saying because LCD is too expensive now for a big screen, as well as the HDtivo / hd dvr and only 3 hrs of prime time per night, that that's pretty much why you wont switch now. Also it seems that you have your heart set on LCD. Will you still want lcd when a new technology comes out in 2009? If so, then I can understand waiting because lcd should be rock bottom by then. But if not, heck, it only takes a cheap crt with tuner to get 100% free hd :)

And as far as content, i can barely keep up with what I have now. If they ever would make 'everything' hd, I'd have a serious problem. Then again, there is no show I don't watch now just because it's only in SD. But still, i'm betting I'd want more if certain things were in HD and I'd have to double the amt of time in front of the tube.I my case, there is only one local OTA HD channel and it is a pitiful local channel (NBC), unless I go cable. So, buying into HD just makes no sense at all, because through DirecTV I would currently only be able to get the HD channel mix that most people believe isn't worth the $11 per month (new price). In the case of the premium channels, I would only subscribe to HBO, because IMHO Showtime and Starz suck.

Additionally, DirecTV will not be offering HD Locals for my location at anytime within the next two years or maybe never at all and the local channels that are re-broadcasted via repeaters will not approve waivers.

An investment of $3,000 to $4,000 just to watch HBO in HD is currently not justifiable, and I believe everyone would agree that this not a justifiable situation.

And in the case of LCD technology, there are huge changes coming to that technology, including the total elimination of backlighting and almost zero response times, and in a few years 60” panels should be selling for under $1500 and should be only a couple of inches thick. And at the same time HD DVRs will be cheap and be able to record hundreds of hours of HD content and the technology base should be better stabilized and MPEG4 should be the standard across the board.

So, until my options expand, I will live with the SD that I have had since 1994 and I will have to be happy with it.

Currently, the only HD content that I am really missing is college or NFL football, and today I Netflix all my movies. In the early days, I use to PPV most of my movies from DirecTV but found that their selection was not as expansive, always came out later that DVD, and not enough of their selections are in letterbox format.