NewsCorp Sets 20m Subscriber Target for DirecTV

14 October 2003

News Corporation has set a target of 20 million subscribers for DirecTV, the US satellite operator it is in process of buying.

Peter Chernin, president/chief operating officer at the Murdoch empire, believes improved spending controls and customer relationship management will help DirecTV's customer base grow rapidly from its current total of around 11.5m.

"We think it's very realistic to grow by one million subscribers a year," he told the Financial Times, "and we'd like to get to 20m subscribers in the long term."

A customer base of this magnitude would make DirecTV – the leading US satellite-TV operator – similar in size to the top cable companies. Currently the biggest cable firm is Comcast, which boasts around 21.3m subscribers.

Chernin welcomed DirecTV's attempts to introduce "much greater discipline in operating the business," but added that more needed to be done to bring down the cost of gaining new customers.

NewsCorp is thought to be planning the same growth tactics for DirecTV as it used successfully for British satellite firm BSkyB. Indeed, outgoing BSkyB ceo Tony Ball will lend a hand at the US firm, Chernin confirmed.

However, these plans still depend on NewsCorp getting regulatory approval for its purchase from General Motors of a controlling stake in DirecTV parent Hughes Electronics.

Last week the Federal Communications Commission temporarily halted its review of the deal.. The FCC stopped the 180-day 'clock' it has set for the investigation while it gathers more information and seeks further consultation with the Justice Department, which is probing the antitrust implications. When it has achieved these objectives, it will restart the clock.

Chernin said NewsCorp remains "genuinely optimistic" the deal will be approved by the end of 2003. He also sought to allay fears NewsCorp would give DirecTV special rates for its programming (in particular the Fox network). "We have agreed to abide by the programme access rules," he continued, "and we have committed not to treat DirecTV with any preference."

Data sourced from: multiple sources; additional content by WARC staff