DirecTV in the News

Hughes Reports Subscriber Additions for Third Quarter

EL SEGUNDO, Calif.--(BUSINESS WIRE)--Oct. 4, 2000-- Hughes Electronics Corp. today announced its DIRECTV business in the United States added 450,000 net customers to its high-power service in the third quarter of 2000, bringing the total number of customers served to 9 million.

In addition, the company's Latin American DIRECTV business added 126,000 net customers in the quarter, expanding its customer base to more than 1.1 million customers.

Through the end of September 2000, DIRECTV in the United States had acquired 1,307,000 new high-power customers, a 20 percent increase over the first three quarters of 1999. The Latin American DIRECTV service added more than 332,000 new customers in the same period, an increase of more than 80 percent over the first three quarters of 1999.

"While we continue to enjoy robust growth in the United States, our third quarter new customer growth was affected by higher churn related to DIRECTV's first-ever price increase for monthly packages and pay-per-view programming,'' said Eddy Hartenstein, Hughes senior executive vice president, Consumer Sector.

"In addition, one of our top priorities last quarter was to conclude the conversion of customers from our medium-power PRIMESTAR By DIRECTV service to the high-power service -- a process we completed September 30th after converting approximately 1.5 million customers,'' added Hartenstein.

Hartenstein noted that this completion date was seven months ahead of schedule, resulting in significant cost savings to DIRECTV. In addition, DIRECTV is continuing to pursue the small percentage of former PRIMESTAR By DIRECTV customers who have yet to transition to the DIRECTV high-power service.

Thus, the company estimates that DIRECTV will convert between 65 and 70 percent of the former PRIMESTAR customers living in non-NRTC territories (consistent with Hughes' conversion goal stated at the close of the PRIMESTAR acquisition on April 28, 1999).

"We're now focusing all resources -- including our DIRECTV HOME SERVICES network of over 2,000 installers -- on implementing our most aggressive fourth-quarter subscriber acquisition offer ever,'' Hartenstein added.

"For the first time in its history, DIRECTV is entering the fourth quarter with the equipment and installation capacity needed to meet the traditionally strong year-end holiday demand,'' Hartenstein said.

"As a result, we believe more new customers than ever will choose DIRECTV in the fourth quarter -- and by the end of the year, we expect to have added between 1.85 million to 2.05 million new high-power customers, representing another record year for DIRECTV,'' added Hartenstein.

These year-end projections exclude the impact of the more than 300,000 PRIMESTAR By DIRECTV subscribers who did not convert to the high-power DIRECTV service during 2000.

Hughes also announced that on Oct. 11, 2000, it expects to report third quarter EBITDA(1) of approximately $90 million to $110 million, which is consistent with the analysts' consensus. In addition, Hughes expects to report quarterly revenues ranging from $1,650 million to $1,700 million.