Sinclair Broadcast Group #1- Stern

Posted on September 30, 2015 by Samuel Stern

Samuel Stern

Sinclair Broadcast Group Inc. Logo (Photo courtesy of blog.solidsignal.com) [1]

Sinclair Broadcast Group Inc.

10706 Beaver Dam Rd

Hunt Valley, MD 21030

sbgi.net

Company Background

The Sinclair Broadcast Group Inc. (SBG), is the largest broadcaster of television content in the United States. Sinclair owns and operates the majority of 164 television stations in 79 US markets, and owns the rest through local marketing agreements. The company reaches the largest and smallest US markets and controls the largest number of ABC, CBS, CW, FOX and MYTV affiliates in the country. Sinclair also operates 3 radio stations in the Seattle-Tacoma Market [3].

SBG Network Affiliates (photo courtesy of sbgi.net) [2]

The Maryland-based broadcaster is the nation’s leading local news provider, has recently begun the distribution of premium college and high-school sports programming, and operates the American Sports Network and the Ring of Honor Wrestling league. After making making several lucrative deals to acquire stations in new markets, including a re-negotiation with DISH Network, Sinclair now reaches 37.6% of U.S. television households. Recent success has given Sinclair the opportunity to pursue new business ventures and acquire new assets [4].

ONEMedia logo, one of Sinclair’s most recent technology investments [19]

Sinclair also makes strategic equity investments through its Business Venture subsidiary. The company holds interests in multiple media and technology companies such as Acrodyne Services, ONEMedia, and Dielectric, as well as in real estate properties [5] (Scroll to investments).

Leadership

David D Smith, President & CEO (Photo courtesy of bizjournals.com) [6]

David D. Smith, President & CEO
Frederick G Smith, Vice President
Dr. J Duncan Smith, Vice President
David B. Amy, Executive VP & COO
Christopher S. Ripley, CFO

For further Bio’s of Sinclair Executives: http://sbgi.net/corporate-governance/

History

Julian Sinclair Smith, Founder (photo courtesy of sbgi.net) [10]

In 1971, Julian Sinclair Smith started the Chesapeake Television Corporation, which operated one station in Baltimore. That one station would eventually be the cornerstone of the nation’s largest broadcast company. Julian’s sons David, Fred, and Duncan would take over the company, and in the early 1980’s change the name to the Sinclair Broadcast Company, Inc. David D. Smith took over the company as president and CEO. Throughout the 1990’s, the brothers would go on a buying spree of content that allowed Sinclair to dominate the industry, increasing its number of television stations from 3 to 59. They purchased content in markets across the country, large and small. The passage of the Telecommunications Act of 1996 allowed for some deregulation of buying control by the FCC, which allowed the company to make more important station acquisitions. This entrepreneurial attitude and progressive vision is still integrated throughout the company today [9].

Financials

The Sinclair Broadcast Group Inc. went public in 1995 and is currently traded on the NASDAQ Global Select Market at $35.36 per share. The company has just released its Third Quarter Financial Results, revealing that the executives expectations were exceeded over the past year. Compared to the 3rd quarter of 2014, Sinclair realized a massive 10.8% revenue increase of $548.4 million versus $495.0 million the year before. The total yearly revenue increased 17.9% to $1.6 billion, versus $1.36 billion in the prior year period [7].

According to a late September Financial presentation at the Deutsche Bank Leveraged Financial conference, Sinclair reported a large increase in the amount of money the company can use to pursue its current ventures and find opportunities to enhance shareholder value, purchase more assets, and branch out to other revenue streams [8].

This influx of revenue has allowed Sinclair to work on technological advances to the company, a new initiative it has been following over the last year.

Key Initiatives

Sinclair has been on a buying spree throughout the past quarter.

The American Sports Network (ASN), Sinclair’s premiere sports division, broadcasts sports from 18 different NCAA athletic conferences [12]. The games are aired over stations that Sinclair owns or are syndicated through non-Sinclair stations. The ASN, launched in 2014, just made two deals in September with ESPN to carry Mid-American Conference football and basketball games, and to broadcast 10 American Athletic Conference Men’s basketball games per year on the large new sports platform [11].

American Sports Network logo (photo courtesy of wikipedia.com) [15]

Sinclair is being aggressive in order to bolster the progress of the ASN. They are currently negotiating a $500 million deal to buy the Tennis Channel, which operates 90% of Tennis content in the U.S. reaching 35 million homes [13].

On October 31st, the first-ever 24/7 Sci-fi multi-channel network was launched through a joint venture between Sinclair, MGM, and Michael Eisner’s Tornante investment company. The network is called COMET, and was the largest multicast channel release ever, reaching over 60% of the country [16]. The deal notes an effort by Sinclair to own its content due to the fact that it has almost reached the FCC limit for television ownership.

COMET logo, Sinclair’s newly owned Sci-fi Network (photo courtesy of comettv.com) [14]

On November 4th, Sinclair closed a deal with Pappas Telecasting and Lincoln Broadcasting in Central Nebraska to purchase a Fox affiliate and multiple ABC affiliated news stations. Sinclair purchased the stations for $31.25 million and the FCC has approved the deal [17]. This is a basic transaction for Sinclair in their pursuit of owning broadcast platforms in more markets.

Projections

Sinclair has taken advantage of its recent success to pursue initiatives that technologically advance the company and continue its dominance over the broadcast industry. One way to increase its footprint in an increasingly digitized world is the ability to broadcast and advertise on mobile platforms and enhance the broadcast experience. ONEMedia is working with all levels of the broadcast industry, from content producers to distributors, to design the “Next Level Broadcast Platform” that integrates mobile devices, creates an Ultra High Definition layout to broadcast, and creates new business models that improve upon the current structure of the industry [18].

Marketron Logo, Sinclair’s newest business partner. (Photo courtesy of contactworld.com). [25]

In late November, Sinclair and the leading media software provider Marketron negotiated a multi-year contract for Sinclair’s stations to use Marketron’s location-based mobile advertising. By studying demographics and utilizing mobile networks, Marketron allows advertisers to maximize accuracy and reach. This is a tactical move for Sinclair as it adds revenue streams by attracting potential advertisers to Sinclair’s growing reach [20].

Sinclair was recently part of a Memorandum of Understanding (MOU) with Pearl TV, a partnership of 9 leading broadcast companies, and Samsung Electronics America, the nation’s leader in television sales for the last 9 years [26]. The MOU will sustain technological advances in the industry and look to develop new ways to broadcast premium content to consumers. The three companies will implement the Advanced Television Systems Committee (ATSC) to overlook and advance the technical standards for broadcasting [21].

SAMSUNG Electronics Logo (photo courtesy of commons.org). [22]

To more accurately monitor the affect of these technological advancements on consumers, Sinclair signed a new deal with Rentrak, a demographic rating service, on November 11th. Rentrak has already been working with Sinclair on a smaller deal, but will now cover all of Sinclair’s stations. Rentrak will provide Sinclair with accurate qualitative data from large sample sizes that will benefit all of Sinclair’s advertisers [23].

Sinclair is looking to consolidate the growing responsibilities of the company in order to streamline the organization of new assets. On September 10th, Jerry Lilly, a former CNN executive, was named to the new position of Vice President of Operations. He will work closely with the VP of Data Systems and the VP of Engineering to incorporate new workflows into the company and ensure that Sinclair’s TV facilities around the country are equipped with the most up-to-date technology [24].

The buying spree that Sinclair has been on recently has brought it close to the FCC station ownership cap of 39% of TV homes [27]. The company will look to start owning more of its content to create revenue streams, while still upholding its current re-transmisison and affiliate contracts that have put Sinclair at the top of the broadcast industry.

Sources

(photos contain URL)

[1] SBG Logo. http://www.valuewalk.com/wp-content/uploads/2013/09/SBG-Sinclair-Broadcast-Group.jpg

[2] SBG Network Affiliate Logos. http://sbgi.net/wp-content/themes/sbgi-sparkling/images/affiliates.png

[3] SBG Summary Page.

[4] SBG Company News Release. Sinclair Broadcast Group Announces Agreement to Swap Television Stations With Gray Television,

[5] SBG Investment Information, http://sbgi.net/ (Scroll to investment information).

[6] David D. Smith Photo. http://assets.bizjournals.com/baltimore/print-edition/David-Smith*750.jpg?v=1.

[7] SBG Third Quarter Earnings Call (2015),

[8] SBG Financial Report (2015). Deutsche Bank Leveraged Financial Conference Presentation.

[9] SBG History (2015).

[10] Julian Sinclair Smith Photo (2015). http://sbgi.net/history/1970s/.

[11] Kuperberg, J. (2015). Sinclair’s American Sports Network to Televise AAC Men’s Basketball Games, Broadcasting & Cable.

[12] American Sports Network Conferences (2015). http://americansportsnet.com/conferences

[13] Cynopsis Media (2015). Sinclair Hits the Market, Cynopsis,

[14] COMET Network Logo (2015). http://comettv.com/

[15] American Sports Network Logo (2015). https://sp.yimg.com/xj/th?id=OIP.Mf26c3227d715a63de7998852578bc82fo0&pid=15.1&P=0&w=300&h=300.

[16] SBG News Release (2015). SBG and MGM Announce COMET, First-Ever Science Ficiton Multi-Channel Network, to Premiere October 31st.

[17] McAdams, D. D. (2015). Sinclair to Buy Pappas Stations for $31.25 million, TV Technology,

[18] SBG ONEMedia Information (2015). http://sbgi.net/one-media/,

[19] ONEMedia Company Logo (2015). http://www.onemediallc.com/images/logo-main.jpg.

[20] Lafayette, J. (2015). Sinclair Signs Exclusive Deal with Marketron, Broadcasting & Cable,

[21] SBG News Release (2015). Samsung, Pearl TV and Sinclair Broadcast Group Announce MOU to Speed Development and Implementation of Next-Gen Broadcast UHDTV Standards.

[22] SAMSUNG Electronics Logo (2015), http://bit.ly/1TkZ7f4,

[23] Lafayette, J. (2015). Sinclair Signs New Deal for Data From Rentrak. Broadcasting & Cable.

[24] SBG Company News Release (2015). Sinclair Names Jerry Lilly To The Newly Created Position Of Vice President Of Operations.

[25] Marketron Company Logo (2015). https://www.contactcenterworld.com/images/company/marketron-largex3-logo.png

[26] Tendra, J. (2015). Memorandum of Understanding Form. Sample Template.

[27] Halonen, D. (2013). FCC Mulls Hard 39% Cap on TV Ownership. TVNews Check.

NETFLIX

Posted on March 25, 2015 by Bess Howell

by BESS HOWELL

Netflix Logo – Courtesy of pr.netflix.com

Corporate Headquarters [3]

100 Winchester Circle Los Gatos, CA 95032

+1 (408) 540-3700

http://netflix.com/

Leadership [1]

– Reed Hastings: Founder and CEO

David Wells: Chief Financial Officer

Kelly Bennett: Chief Marketing Officer

Jonathan Friedland: Chief Communications Officer

Tawni Cranz: Chief Talent Officer

Ted Sarandos: Chief Content Officer

History [2]

Courtesy of 3dprint.com

In 1997, Reed Hastings and partner Marc Randolph founded Netflix. Initially, the company was founded to offer online movie rentals. Consumers were able to pick from a selection of titles and have them delivered to their homes. Two years later, Netflix became a subscription-based service, providing customers with unlimited movie rentals for a monthly rate. In 2002, Netflix became a publicly traded company on NASDQ. In 2007, Netflix introduced its extremely popular movie and television streaming service. International expansion began in 2012, Netflix becoming available in Latin America and the Caribbean. Netflix introduced original content in 2013, including the award-winning shows “House of Cards” and “Orange is the New Black.” Now with over 60 million global subscribers, Netflix is a notable name and pioneer in the television industry.

Financials [7]

Courtesy of Google Finance

Netflix’s 2015 first quarter earning results were extremely mixed, but in the end left investors happy and the company optimistic about the future [6]. Netflix reached the analyst forecasted revenue of 1.57 billion dollars, but per share earnings dropped to 38 cents. Although Netflix surpassed the previous year’s revenue, EPS dropped over 50 cents from 2014. This can be partially attributed to the Q1 net income, at 23.7 million, which decreased 55.4% from one year ago [9]. This loss is a result of the strong U.S. dollar, which greatly lowered international revenue. Without loses due to the foreign exchange rate, the per-share earnings would have been recorded at 77 cents [8]. Netflix stock increased over 18%, reaching an all time high of $530 dollars. Analysts believe this is due to the massive subscriber growth, which increased by 4.9 million in the first quarter of 2015 for a total of 62.3 million [5], 500,000 more than the company had expected. Stocks may not stay at the high price they reached, as CEO Reed Hastings proposed a stock split in the near future. If the stock split does not happen however, FBR & Co analyst Barton Crockett predicts that Netflix shares could reach $900 within the next year [4]. With a loyal consumer base, growing subscribers, and plans for global expansion, there is not much in the company’s way for it’s numbers to only go up.

Global Expansion

Netflix overseas expansion is the leading driver of subscriber growth. Courtesy of broadbandtrends.com

Global expansion has become a huge part of the Netflix business model. As subscriber growth slows in the United States, the company looks to other markets in order to both raise revenue and increase opportunities [12]. Currently operating in over 50 countries, Netflix announced in January that they planned to launch the service in 200 countries by 2016 [13], with the hopes of going global by 2020 [11]. Although the company currently loses money in it’s international business, they predict it to be profitable by 2017. Despite these loses, Netflix is extremely well received in its abroad markets. It was released in early April that less than a year after being launched in Europe, Netflix buttons are being added to remote controls that will be shipped all over the continent [16]. Already in 2015, Netflix has become available in Cuba [15], Australia, and New Zealand [10], and is set to launch in Japan this coming fall [14]. The company is also looking into the possibility of launching in China. Global expansion means the opportunity of having content viewed over the entire world, which will open Netflix up to many opportunities for both licensing and producing even more material[12].

Netflix Originals and Exclusives

In a consumer survey released yesterday that was conducted by FBR & Co, Netflix users said that they prefer the Internet streaming service to television [22]. Much of this has to do with the original content Netflix has been producing in the last few years. On February 27^th the company released the third season of its award winning original, “House of Cards,” which received global attention. It was released on April 2^nd that the show’s fourth season would air sometime in 2016 [23]. March 6^th marked the premier of “Unbreakable Kimmy Schmidt,” and on March 20^th their new dramatic thriller “Bloodline” was released. On April 10^th Netflix aired Marvel’s “Daredevil,” the first of a five series-deal [18]. The company also released the teaser for the fourth season of “Orange Is The New Black” two days ago [17]. For the rest of 2015, Netflix plans on releasing five more original series [18], as well as five additional original programs geared towards children [26].

At the Sundance Film Festival in January, Netflix made a deal with the notable Duplass brothers [24]. Netflix will finance four films produced by the team, which will go to directly to the service after a short theatrical window. This partnership paid off at SXSW this March when Netflix obtained the exclusive global rights to the film “6 Years,” Which was produced by the Duplass brothers [25] This film was not part of the deal signed in January, and thus was an extra acquisition for the company.

King Penguins, at sunrise on the coast of South Georgia Island. Southern Ocean,

“Our Planet” will be shot in 4K over the course of four years. Courtesy of hollywoodreporter.com

Netflix recently introduced its intentions for multiple new documentary projects. Teaming up with Silverback Films, the company that created “Planet Earth,” Netflix plans to produce an eight-part natural history series entitled “Our Planet.” [20] This four-year project is set to air in 2019. On March 4^th, the company also announced a planned partnership with Leonardo DiCaprio and production company Appian Way to create a series of Netflix exclusive documentary projects [21]. DiCaprio will produce all of the projects, which will concern the environment and conservation.

Promotions

Already in the first quarter of 2015, Netflix has partnered with various tech companies to help promote the brand and increase subscribers. On March 25^th T-Mobile announced that if customers buy a Samsung Galaxy S6 phone, they will get a free one-year subscription to Netflix [27]. The logic behind this partnership is to both drive the sales of S6 phones at T-Mobile, and create more potential long-term subscribers for Netflix. Separate from T-Mobile, Samsung enticed consumers in Australia earlier this month to buy from a series of new 4K smart TVs by offering six free months of Netflix [28]. This partnership came just weeks after the streaming service launched in Australia.

Samsung partners with Netflix – Courtesy of samsungpromotions.com

Netflix also came out with it’s first set of “Netflix Recommended TVs,” part of a program that the company launched in early 2015 to help integrate itself better with smart TVs. The recommendation is meant to promote the TV’s easy Internet access capabilities and help Netflix become more easily accessed through the television rather than the computer. The TVs will come from companies like Sony, LG, TCL, and Insignia, and will include the Netflix logo when in retail [29].

Netflix wants to push more consumers towards viewing their content, making it available through internet capable TVs more accessible. Courtesy of devices.netflix.com/recommendedtv

Overview

Netflix is truly an innovator in the television industry. CEO Reed Hastings said in a recent interview that “Internet TV is going to replace linear TV” within 20 years [30]. At the current rate Netflix is going, that could likely be possible. Netflix has excellent financials, global prospects, a loyal and growing subscriber base, notable content, and forward thinking business strategies. There is no reason why they should not be able to reach their goals in coming years.

Sources

[1] Officers and Directors, Netflix International Relations, Retrieved: April 15, 2015

[2] Company Timeline, Netflix Media Center, Retrieved: April 15, 2015

[3] Netflix Corporate Headquarters, Corporate Offices and Headquarters, Retrieved April 15, 2015

[4] Netflix stocks top $500 for the first time ever. Next stop = $900?, CNN Money, Retrieved April 16, 2015

[5] Netflix shares explode after unexpected subscriber growth, Business Insider, Retrieved April 16, 2017

[6] Netflix adds nearly 5 million subscribers in first quarter, USA Today, Retrieved April 15, 2015

[7] Letter to Shareholders, Netflix International Relations, Retrieved April 16, 2015

[8] Why Investors Are So In Love With Netflix Right Now, Time, Retrieved April 16, 2015

[9] Netflix Shares Soar On Q1 Report Showing Strong Sub Growth And Stock Split Plans, Deadline, Retrieved April 16, 2015

[10] Netflix Goes Live In Australia And New Zealand, Its First Launches In Asia Pacific, Tech Crunch, Retrieved April 16, 2015

[11] Analysts giddy at Netflix plans for international expansion, Market Watch, Retrieved April 16, 2015

[12] Netflix Accelerates Ambitious Global Expansion as U.S. Growth Slows, The New York Times, Retrieved April 15, 2015

[13] Netflix Steps Up Foreign Expansion, Wall Street Journal, Retrieved April 16, 2015

[14] Netflix To Launch In Japan This Fall, Netflix Media Center, Retrieved April 15, 2015

[15] Netflix Is Available In Cuba, Netflix Media Center, Retrieved April 15, 2015

[16] Major Consumer Electronics Manufacturers Add Netflix Button To Remote Controls Across Europe, Netflix Media Center, Retrieved April 15, 2015

[17] Netflix Renews Orange Is the New Black for Season 4, Releases New Clip, Time, Retrieved April 16, 2017

[18] 7 New Netflix Original Premiering This Year, Cheat Sheet, Retrieved April 15, 2015

[19] In 2015, Must-See TV Will Often Be Netflix Exclusives, Daily Finance, Retrieved April 15, 2017

[20] ‘Our Planet’ Set At Netflix; 8-Part Follow-up To ‘Planet Earth’ Series, Deadline, Retrieved April 16, 2015

[21] NETFLIX AND LEONARDO DICAPRIO TO PARTNER ON UPCOMING DOCUMENTARY PROJECTS, Netflix Media Center, Retrieved April 15, 2015

[22] Is Netflix More Popular Than TV?, CBS Money Watch, Retrieved April 16, 2015

[23] ‘House Of Cards’ Season 4 Will Air In 2016, Huffington Post, Retrieved April 15, 2015

[24] Netflix Makes 4-Pic Pact With Duplass Brothers – Sundance, Deadline, Retrieved April 15, 2015

[25] Netflix Nabs Global Rights For Drama ‘6 Years’ At SXSW 2015, Deadline, Retrieved April 15, 2015

[26] NETFLIX EXPANDS ITS PORTFOLIO OF ORIGINAL AND EXCLUSIVE TV SERIES WITH FIVE NEW SHOWS FOR KIDS OF ALL AGES, Netflix Media Center, Retrieved April 15, 2015

[27] T-Mobile Offers One Free Year Of Netflix For Buying A Samsung Galaxy S6, Forbes, Retrieved April 15, 2015

[28] Samsung releases new 4K smart TVs in Australia, offers six months free Netflix, Sunday Morning Herald: Digital Life, Retrieved April 16, 2015

[29] Netflix Announces First ‘Recommended TV’ Partners, Variety, Retrieved April 15, 2015

[17] Netflix Doesn’t Want to Kill HBO. It Wants to Kill TV, re/code, Retrieved April 16, 2017

DirecTV

Posted on October 5, 2014 by mjnixon

by Marla Nixon

DIRECTV logo, Photo courtesy of: [1] www.slashgear.com

CONTACT INFORMATION [2]

2260 E Imperial Hwy

El Segundo, CA 90245 United States

(310) 964-5000

www.directv.com [3]

COMPANY OVERVIEW

DIRECTV was founded in 1990 and is currently one of the world’s largest digital television services. The company provides services to over 32 million customers in the United States and Latin America (20 million in the United States and 18 million in Latin America). These services include HD, 3D and Video-On-Demand programming. DIRECTV is known for their #1 ranking in customer service as well as their sports programming which includes the NFL Sunday Ticket (see below “Deals and Acquisitions” for more details) [4].

ELECTED OFFICERS [5]

Michael White, Chairman, President & CEO, Photo courtesy of: [5] www.directv.com

Chairman, President & CEO: Michael White

Chief Human Resources Officer: Joseph Bosch

President, DIRECTV Latin America: Bruce Churchill

Chief Financial Officer: Patrick Doyle

General Counsel: Larry Hunter

Chief Technology Officer: Romulo Pontual

Chief Accounting Officer: Steve Adams

FINANCIAL SNAPSHOT

DIRECTV announced their 2014 3rd Quarter results on November 6th, 2014 [6]. The results showed a revenue growth of 6%, making their total revenue $8.4 billion. This revenue growth was due to an increase in U.S. ARPU (Average Revenue Per User) and DIRECTV Latin America (DTVLA) subscriber growth. However, this increase in revenue was offset by a lower ARPU at DTVLA. The lower ARPU at DTVLA was due to unfavorable changes in exchange rates.

DIRECTV stock quotes from June 2014 to present (6 months), Photo courtesy of: [7] www.money.cnn.com

Their current stock price (as of December 1st, 2014) is at $87.37 per share. This price has a year-to-date increase of 26.51% and a three-year increase of 89.69% [7]. Although financials have shown an increase it is important to note that DIRECTV has sustained subscriber loss in both the United States and Latin America units. This subscriber loss has been attributed to their credit policies and a rise in competition [6] [8].

MAIN COMPETITORS

DIRECTV has three main competitors: Comcast, Dish Network and Time Warner Cable [9]. Comcast is their biggest competitor ranking number one in the pay-TV market with 22.5 million video subscribers (DIRECTV holds about 20 million video subscribers) [10]. There is currently a proposed merger between Comcast and Time Warner Cable (see Tuned In [15] and The Eyes Have It [16] graphics under “Deals and Acquisitions). This merger is still under consideration by the FCC, but if approved will put Comcast even further in the lead of the pay-TV market [11].

DEALS AND ACQUISITIONS

On September 1st, 2014, a negotiation dispute between Raycom Media and DIRECTV caused a 7-day standoff that resulted in a blackout for some DIRECTV subscribers. 43 Raycom stations, including channels with NFL programming, went dark on DIRECTV. The dispute was resolved before the Sunday NFL game and all channels were restored [12].

Displays percentage of the market Comcast and DIRECTV will have if both mergers are approved, Photo courtesy of:[15] www.wsj.com

In May of 2014 AT&T announced that it planned on acquiring DIRECTV with a $48.5 billion merger. If combined, DIRECTV and AT&T will have more than 26 million subscribers in the United States. This would put DIRECTV ahead of Comcast (22.5 million subscribers as of Fall 2014) in the market for pay-TV. However, if the Comcast and Time Warner Cable merger occurs, DIRECTV would still remain second-largest. Looking at the graphic “The Eyes Have It [16],” if the DIRECTV and AT&T merger is made they will have a total of 25.8 million subscribers, unfortunately that number will remain dwarfed by Comcast if the Comcast-Time Warner Cable merger occurs bringing them up to 33.1 million subscribers (note that The Eyes Have It graphic only shows data up to 2013, data not referencing The Eyes Have It are current). However, both mergers have yet to be approved by the Federal Communications Commission (FCC) [13]. Both mergers have been under heavy consideration by the FCC because of the massive amount of subscribers each merger affects. If either or both merger are approved the pay-TV market competition will rise dramatically. On September 25th, 2014, DIRECTV stockholders approved the merger with AT&T in a vote that represented 77% of all outstanding shares. The voting results showed that more than 99% of votes casted were in favor of the merger agreement [14].

Current subscribers to DIRECTV, AT&T, Comcast and Time Warner Cable, Photo courtesy of: [16] www.wsj.com

To learn more about the AT&T and DIRECTV merger watch a news broadcast here. Video courtesy of: [17] www.wsj.com.

On October 1st, 2014, DIRECTV renewed it’s deal with the National Football League (NFL) for the NFL Sunday Ticket. The NFL Sunday Ticket includes the showing of all out-of market games (regular season games outside of their local markets) as well as real time stats [18]. The NFL Sunday Ticket has been given exclusive rights to DIRECTV and is being extended for 8 years. The price was confirmed at $1.5 billion per season which is a 50% price increase compared to what DIRECTV paid in previous years. DIRECTV produces revenues of about $600 million from the NFL Sunday Ticket with around 2 million subscribers. This revenue is far below what they are now paying for the rights of the NFL Sunday Ticket programming [19]. A possible reason for DIRECTV’S agreeing to a dramatically increased price is their proposed merger with AT&T (see above paragraph). If DIRECTV did not renew it’s deal with the NFL for the Sunday Ticket, AT&T was allowed to walk away from the deal without any penalties [19] [20].

In early November, AMC Networks threatened to go dark on DIRECTV if negotiation standards are not met. With their hit show The Walking Dead halfway through its season a blackout would be dangerous for DIRECTV business. The contract is set to expire in 2015 and there have been warnings aired on the show that DIRECTV subscribers may not continue to receive programming from AMC [21]. However, DIRECTV has stated that subscribers will be able to view every episode of the upcoming season of The Walking Dead in a public promise on their website [22].

DIRECTV and Guest-tek announced a strategic relationship on November 13th. This relationship expands technology and programming for hotels and guests [23].

LOOKING FORWARD

DIRECTV is now offering 4K Television. 4K television, also known as Ultra HD, is the latest HD technology and is called 4K because of the image width (4,000 pixels) [24]. DIRECTV is the first and only multi-channel video provider to offer 4K/Ultra HD TV. To receive DIRECTV 4K programming, subscribers need the DIRECTV Genie HD DVR and a DIRECTV 4K ready television. Currently the only DIRECTV 4K ready TV’s are the 2014 Samsung Ultra HD/4K television models [25]. The DIRECTV 4K programming was released on November 14th and currently has about 20 movie titles to choose from [26].

Photo courtesy of: [27] www.seriable.com

DIRECTV has also been creating some of their own content programming since 2013. Most recently, a new drama called “Kingdom” starring Jonathan Tucker and Nick Jonas has had a 20-episode renewal a week after its premiere. The show is about a mixed Martial Arts group living in Venice, CA. “Kingdom” has been their most-watched series on their Audience Network [28]. The DIRECTV Audience Network is devoted to their original programming [29].

Watch the Kingdom series trailer here. Video courtesy of: [30] www.youtube.com.

SOURCES

1. DIRECTV’s Logo, www.slashgear.com, RT: 11/29/2014

2. Contact Information, www.hoovers.com, RT: 11/29/2014

3. DIRECTTV’s Website, www.directv.com, RT: 11/29/2014

4. “Our Company”, www.directv.com, RT: 11/30/2014

5. Elected Officers, investor.directv.com, RT: 11/28/2014

6. 2014 3rd Quarter Results, investor.directv.com, RT: 11/30/2014

7. DIRECTV Stock Quotes, www.money.cnn.com, RT:11/30/2014

8. “Tighter Credit, Competition Pressure DirecTV,” www.multichannel.com, RT: 11/30/2014

9. Competitors, www.hoovers.com, RT: 11/30/2014

10. Comcast Vs. DIRECTV, www.fool.com/investing, RT: 11/30/2014