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DirecTV Units To Carry Own Brand Exclusively

1/10/2004 12:20:00 PM Eastern

LAS VEGAS — DirecTV is taking over complete responsibility for the sale and distribution of set-top boxes for its direct broadcast satellite service, in one of the first major moves under News Corp. leadership.

At the same time, DirecTV will require manufacturers producing equipment for the service to dispense with differentiated features and even their own company brands as the service moves to maintain uniformity of look and operation in all DirecTV products under a single DirecTV banner.

DirecTV said the goal of the initiative is to 'offer DirecTV customers a simple and more user-friendly experience, while also delivering a more efficient supply-chain process to its retail partners.' The approach will follow closely the equipment development and distribution system used by rival EchoStar for the DISH Network service.

DirecTV will assume complete responsibility for the sale and distribution to retail of all set-top boxes used to receive DirecTV programming and services by mid-2004, the company said. Over the course of the year, authorized manufacturers of DirecTV hardware will migrate to a new standardized hardware specification, which will ensure that all DirecTV customers enjoy a consistent user interface and experience.

In the past, manufacturers who produced integrated receiver descrambler equipment for the direct broadcast satellite service were allowed to develop equipment with somewhat differentiated features, such as their own graphical user interfaces. But, executives associated with DirecTV have said these varied approaches created confusion among some subscribers, and presented logistical challenges for DirecTV's services and support programs.

Under the new system, DirecTV retailers will have a single point of contact for all DirecTV needs. Ironically, days before CES, RadioShack, which has been one of DirecTV's largest retail partners, said it would no longer sell DirecTV equipment or services.

DirecTV said it activated 405,000 net new subscribers in the fourth quarter and ended the year with more than 12.2 million subscribers. For the full year, DirecTV added over 3 million gross owned-and-operated customers.

Meanwhile, DirecTV said it now plans to deliver its first HDTV-capable combination receiver and TiVo digital video recorder in March at a $999 suggested retail. The DVR will be manufactured for DirecTV by sister company Hughes Network Systems.

DirecTV also announced it has reached deals to offer CBS-HD programming from the network's New York's WCBS and Los Angeles’ KCBS stations in coming weeks. DirecTV said it expects to have the programming available in time for the Feb. 1 Super Bowl XXXVIII telecast. The game will be available in the CBS Network’s 16 owned-and-operated stations.

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