DIRECTV ‘gets out in front’ of HDTV, plans for future

Derek Chang, executive VP of content strategy and development for DIRECTV, discusses how the direct-to-home satellite provider nearly hit its 100 HD channel goal, and where it plans to take its HD offerings in the future.
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DIRECTV is rapidly closing in on its stated goal of offering 100 national channels in HD while simultaneously supporting delivery of local HD channels via its direct-to-home (DTH) satellite delivery service.

To accomplish its goal, DIRECTV has embarked on a significant enhancement of its infrastructure, including the launch of two new HD satellites — one currently in orbit and a second scheduled for liftoff later this year — new earth stations and the rollout of MPEG-4 AVC and more efficient modulation technology.

HD Technology Update spoke with Derek Chang, executive VP of content strategy and development for DIRECTV, about DIRECTV’s HD progress and what remains to be done.

HD Technology Update: DIRECTV announced last year that it planned to have 100 HD channels available by the beginning of this year. Where do you stand today with that goal, and what are your HD plans for 2008?

Derek Chang: Today, DIRECTV offers 92 national HD channels and will continue to roll out additional national and local HD channels this year. With the launch of our DIRECTV 11 satellite later this year, we’ll have total capacity for 150 national HD channels and 1500 local channels. Customers will also have access to more HD programming via our new DIRECTV On DEMAND VOD service that will launch this spring.

HD Technology Update: What was the reaction of programmers to your initial announcement of the 100 HD channel goal last year? Did that reaction change over time? If so, how?

Derek Chang: This was a bold move to push the envelope on HD, and we certainly experienced some skepticism, given the time frame that we laid out. But, programmers soon began to realize they would lose viewers to other HD services, or to other media platforms. That would directly impact their ratings. HD is a compelling visual experience that would reel those audiences back in and the advertisers along with them. That message began to sink in. As we signed on programmers, one by one, we began to see an attitudinal shift and then we reached the tipping point. We’ve now launched multiple HD feeds from every major programmer in the industry, including Fox, NBC, Disney, Viacom, Turner, Showtime, HBO, Discovery, NBC and Starz, along with many others.

HD Technology Update: It seems now that the decision was the right one, but at the time, what were the factors that led to DIRECTV to determine that now’s the time to make this large commitment? Did any technology advances — such as the availability of MPEG-4 AVC encoders or DVB-S2 modulation — play a role in the timing?

Derek Chang: We knew that HD would one day be a significant driver in the video business and present an opportunity to set ourselves apart from our competitors while also providing DIRECTV with a growing base of loyal, quality customers. In fact, HD, along with our DVR services, has been one of the keys to our recent strong performance.

In terms of our commitment to HD, timing and capacity was everything, and it was important for us to get out in front. To do that, we began laying plans for a massive capacity expansion several years ago — an enormously complex process and one of the most ambitious projects the company had ever attempted. Clearly, advances in technology made this possible, and the timing nicely dovetailed with our HD plans. We were among the first to transition to MPEG-4, and by employing advanced modulation, we were able to roughly double our capacity for the same amount of bandwidth. This was critical given that HD is a voracious bandwidth hog.

In addition to the cutting-edge transmission technology, the backbone of our HD delivery system is the HD workhorses of our satellite fleet — the Boeing DIRECTV 10 and DIRECTV 11 satellites. Together, they’ll provide us with the capacity for 1500 local HD channels and 150 national HD channels. DIRECTV 10 launched in July and is now in operation and is responsible for the current HD expansion. DIRECTV 11 is scheduled to launch later this year and will enable us to complete the HD rollout.

Local HD channel delivery posed another challenge and was probably the most complex process. We built out several uplink stations in addition to our primary uplink centers in California and Colorado. We also built out local digital signal collection facilities in each market where we planned to offer local HD and leased thousands of miles of fiber-optic cable to route the signals to our uplink centers.

HD Technology Update: How important is the interface your customers have with their HD service to its success, and what steps have you taken to make it easy to access HD programming?

Derek Chang: With so much confusion about HD in the marketplace, we wanted to make sure their ability to access and enjoy their HD programming was as simple as possible. So, we embarked on a strategy to make HD easy to use and to provide our customers with as much education as possible. We wanted them to have a more intuitive HD experience, so we designed our electronic program guide for easy navigation with features like auto-tuning. We didn’t want the customer to worry about memorizing where his or her favorite HD channel was, or frantically scrolling through the guide to find it. For example, if our customers want to tune to ESPN HD, all they have to do is go to the familiar DIRECTV viewer channel 206 and it defaults directly to the HD simulcast of the channel.

We also developed a comprehensive HD section on DIRECTV.com. If they click on the DIRECTVHD link, they’ll see just about everything they need to know about HD, including a glossary of terms, frequently asked questions and equipment needed for HD, among other things.

HD Technology Update: Where does DIRECTV go beyond 2008 in terms of HDTV?

Derek Chang: We’re committed to remaining the leader in HD programming and maintaining our competitive advantage in this category, whether it’s linear HD channels, more sports products or VOD. The number of HD households is projected to grow to more than 72 million over the next three years — that’s nearly two-thirds of all U.S. TV homes with HDTVs by 2010. We plan to take full advantage of that market opportunity.

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