# New Commitment Terms Start 10/17



## tim81 (Jul 3, 2007)

FYI:

Starting 10/17 D* is instituting new commitment/cancellation terms:

Old: 

Standard 1 yr $150 Cancellation Fee Prorated @ $12.50/mth not fulfilled

Advanced (DVR/HD/HDDVR) 2 yr $300 Cancel @ $12.50/mth

New:

Standard 18 months $300 Cancellation Fee Prorated @ $20.00/mth

Advanced (DVR/HD/HDDVR) 2 yr $480 Cancel @ $20.00/mth

This applies to new customers and replacement receivers after 10/17. Doesn't affect current customer commitment terms. 

If you need a box replaced maybe you should do it tonight!


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## Kevin Dupuy (Nov 29, 2006)

That's doubling the standard account cancellation fee:eek2: 

Does DIRECTV have wording in the contract saying if they change the terms of the contract you can get out free?


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## Pink Fairy (Dec 28, 2006)

Would not matter if they ordered it tonight. Commitment is added when the receiver is activated.


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## boba (May 23, 2003)

Kevin Dupuy said:


> That's doubling the standard account cancellation fee:eek2:
> 
> Does DIRECTV have wording in the contract saying if they change the terms of the contract you can get out free?


Can you read? It dosen't say existing contracts it *STARTS 10/17/07*.


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## Doug Brott (Jul 12, 2006)

Kevin Dupuy said:


> That's doubling the standard account cancellation fee:eek2:
> 
> Does DIRECTV have wording in the contract saying if they change the terms of the contract you can get out free?


Yeah, seems that the terms are changing so new contracts are affected, but existing contracts remain the same.


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## Stuart Sweet (Jun 19, 2006)

I've said it before, the best defense is a good offense, and DIRECTV knows it. As they continue to add new hardware and software, they won't have as many cancellations anyway.


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## schlar01 (Jul 16, 2007)

This stuff is just ridiculous. I signed up a few months ago but didn't want to spend the $300 to get the HD DVR. Now if I want one I need to basically get ripped off for the up front fee AND go back to a full two years AND have a higher cancellation fee? It really makes me want to not stay with D* once my contract expires. I'm overall only OK with the product so far. I love the Sunday Ticket in HD and the extra HD channels but I hate the H20 receivers. I hate the 2-3 second lag when I push any button and I hate the sensitive nature of the buttons when it does go through. Sometimes I can push a button with no response, other times I'll push it and the receiver will put three 2s up. IMO its just not a good product. The $700 price to purchase the equipment is BS, too. It costs nowhere near that to manufacture it. My guess is that the cost of the HD DVR, since its made in China, costs significantly less than the $299 they were charging.

Sorry for the rant but I hate it when companies try to up their contracts. I hate cell phone companies, too.


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## bigref (Sep 11, 2007)

Then get rid of your cell phone also. You would have not been a happy camper if you were with D* in the beginning when the dish and receiver cost $700.00 Or when a good HD receiver from Sony cost close to $1,000


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## Lee L (Aug 15, 2002)

So, I called 3 weeks ago under the old terms and ordered 2 HR20s and the charges show in pending on the DirecTV site. The install was set to be last Saturday, but due to the complete ineptitude of the company DirecTV chooses to represent them , they did not come on Sat or Sun. Now the install is set for Friday. So, through no fault of my own it looks like I am stuck with an extra $180 worth of early term fees? This is total BS.

I have no plans to cancel D*, but stuff like this is just wrong. How about they make a good product and people might not want to leave?


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## Ken S (Feb 13, 2007)

Raising cancellation fees is just less expensive than providing high customer satisfaction.


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## Scarpad (May 22, 2006)

It does make me nervous that if something unfortold comes up that forces me to cut off DTV I'm gonna be hosed


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## hankmack (Feb 8, 2006)

schlar01 said:


> This stuff is just ridiculous. I signed up a few months ago but didn't want to spend the $300 to get the HD DVR. Now if I want one I need to basically get ripped off for the up front fee AND go back to a full two years AND have a higher cancellation fee? It really makes me want to not stay with D* once my contract expires. I'm overall only OK with the product so far. I love the Sunday Ticket in HD and the extra HD channels but I hate the H20 receivers. I hate the 2-3 second lag when I push any button and I hate the sensitive nature of the buttons when it does go through. Sometimes I can push a button with no response, other times I'll push it and the receiver will put three 2s up. IMO its just not a good product. The $700 price to purchase the equipment is BS, too. It costs nowhere near that to manufacture it. My guess is that the cost of the HD DVR, since its made in China, costs significantly less than the $299 they were charging.
> 
> Sorry for the rant but I hate it when companies try to up their contracts. I hate cell phone companies, too.


Just let your existing contract run out and get a new provider (both TV and Phone). Nobody is forcing you to stay.


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## JeffBowser (Dec 21, 2006)

It needs to be repeated endlessly, it seems. These two year committments are needed to subsidize the costs of the equipment, service, and installations. I subscribed to DirecTV back before committments. I paid over a couple thousand to get going with 4 advanced (for back then) receivers, dish, and install. Man, what a testimony against my old cable company that is.


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## techieguy23 (Oct 17, 2007)

I think the commitments are still cheaper in the long run than what cable charges PER BOX, PER MONTH!


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## eibook (Jan 5, 2007)

Ken S said:


> Raising cancellation fees is just less expensive than providing high customer satisfaction.


+1

Very well put.


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## CTJon (Feb 5, 2007)

JeffBowser said:


> It needs to be repeated endlessly, it seems. These two year committments are needed to subsidize the costs of the equipment, service, and installations. I subscribed to DirecTV back before committments. I paid over a couple thousand to get going with 4 advanced (for back then) receivers, dish, and install. Man, what a testimony against my old cable company that is.


With the price of equipment these days (other than this type stuff) you can get a lot more for the money then they charge. The get you up front (maybe they should stop letting people get 299 DVR's for 99) and monthly and then want to charge to cancel. I'd rather pay what it costs and not have any committment.

OR make the committment per equipement and not adding to it every time you sneeze. I'll make a 2 year committment to the HR20 but if I change another device out why should this change my committment to my HR20 or the dish that they don't touch.

If we could ever get business and their buying of our government straightened out maybe we could get some consumer protection and consumer rights. How about every time an installer doesn't show up on time or does a lousy job we get time off our committments.


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## Tonedeaf (Jun 13, 2006)

Damn, I am getting another HR20 installed on Saturday.


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## schlar01 (Jul 16, 2007)

The price of equipment is less than what they are charging. Its not rocket science. The boxes are made in China and the cost of virtually all electronics have falling exponentially since the 1980s or whenever D* started.

I also never said anyone was 'forcing' me to stay.........I just want to able to upgrade to an HD DVR without paying $800, which is a ridiculous inflated number designed to get people to lease them rather than buy them, or sign up for another long term deal plus a high cancellation fee. I may be moving at some point and if I could take my service with my anywhere it would be an issue but apartments are hit or miss and in some cases very difficult to deal with in regards to satellite service.

All I'm saying here is that they could make it a hell of a lot easier for their customers to deal with them.


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## ramcm7 (Aug 1, 2002)

Lee L said:


> So, I called 3 weeks ago under the old terms and ordered 2 HR20s and the charges show in pending on the DirecTV site. The install was set to be last Saturday, but due to the complete ineptitude of the company DirecTV chooses to represent them , they did not come on Sat or Sun. Now the install is set for Friday. So, through no fault of my own it looks like I am stuck with an extra $180 worth of early term fees? This is total BS.
> 
> I have no plans to cancel D*, but stuff like this is just wrong. How about they make a good product and people might not want to leave?


+1

Scheduled for 5LNB and HR20 install last Saturday; install tech had to reschedule for this Saturday. I, too, have no plans to leave right away, but this does suck.


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## hilmar2k (Mar 18, 2007)

schlar01 said:


> ...... The $700 price to purchase the equipment is BS, too. It costs nowhere near that to manufacture it. My guess is that the cost of the HD DVR, since its made in China, costs significantly less than the $299 they were charging.


That is not true. The current cost to manufacture the HR20 is in the mid $400 range. D* hopes to be able to get that down closer to $300, but it isn't there yet.


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## mx6bfast (Nov 8, 2006)

tim81 said:


> FYI:
> 
> Starting 10/17 D* is instituting new commitment/cancellation terms:
> 
> ...


HOLY SHIZNIT!!!!!!!!

Yeah I don't expect my bill to increase more than $2 - 3 when they do the next increase.


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## oakwcj (Sep 28, 2006)

hilmar2k said:


> That is not true. The current cost to manufacture the HR20 is in the mid $400 range. D* hopes to be able to get that down closer to $300, but it isn't there yet.


Source, please.


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## JeffBowser (Dec 21, 2006)

There is a lot more to the costs than just the components, especially on leading edge stuff.



schlar01 said:


> The price of equipment is less than what they are charging. Its not rocket science. The boxes are made in China and the cost of virtually all electronics have falling exponentially since the 1980s or whenever D* started.
> 
> I also never said anyone was 'forcing' me to stay.........I just want to able to upgrade to an HD DVR without paying $800, which is a ridiculous inflated number designed to get people to lease them rather than buy them, or sign up for another long term deal plus a high cancellation fee. I may be moving at some point and if I could take my service with my anywhere it would be an issue but apartments are hit or miss and in some cases very difficult to deal with in regards to satellite service.
> 
> All I'm saying here is that they could make it a hell of a lot easier for their customers to deal with them.


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## hilmar2k (Mar 18, 2007)

oakwcj said:


> Source, please.


Chase Carey on the Liberty Media conference call on 9/21/2007.

EDIT: In case anyone doesn't know who Chase Carey is.


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## Tom Robertson (Nov 15, 2005)

The costs to manufacture the HR20s has also been mentioned in other conference calls to investors. I'm thinking May timeframe.

So the costs to manufacture is less than $800 to buy a unit outright and more than subsidized lease price. I gots no problems with that, I want DIRECTV to profit from me. 

Lastly, don't forget the costs to install the solution: Dish, delivery, installation, etc.

Cheers,
Tom


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## oakwcj (Sep 28, 2006)

Tom Robertson said:


> The costs to manufacture the HR20s has also been mentioned in other conference calls to investors. I'm thinking May timeframe.
> 
> So the costs to manufacture is less than $800 to buy a unit outright and more than subsidized lease price. I gots no problems with that, I want DIRECTV to profit from me.
> 
> ...


I feel so sorry for DirecTV. I didn't realize it was a charity. Can I make a tax-deductible contribution? Does Chase Carey even get paid?


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## marksman (Dec 23, 2006)

Having been with DirecTV since 1994.... Cancellation smancelation.

It is the USSB cancellation fee I worry about.


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## surfmaui03 (Feb 26, 2005)

hilmar2k said:


> That is not true. The current cost to manufacture the HR20 is in the mid $400 range. D* hopes to be able to get that down closer to $300, but it isn't there yet.


Sorry, but that`s pure BS. There is no way it costs them $400 to manufacture this box. I work for HP, and you wouldn`t believe what it cost them to make computers. Now granted HP is a much larger company, they still manufacture all there computers in Taiwan, and it would make you sick if you knew how much it cost to manufacture the product. Mr. Carey will tell you it cost them that much to justify any increased costs, or in this case, the need to increase early termination fees. Electronics are the most inflated product sold in the U.S.
Don`t get me wrong, I am a big D* fan, but I would bet the farm that it`s no where near the $400 stated to manufacture the box........


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## hilmar2k (Mar 18, 2007)

marksman said:


> Having been with DirecTV since 1994.... Cancellation smancelation.
> 
> It is the USSB cancellation fee I worry about.


I believe there are two L's in smacellation.


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## hilmar2k (Mar 18, 2007)

surfmaui03 said:


> Sorry, but that`s pure BS. There is no way it costs them $400 to manufacture this box. I work for HP, and you wouldn`t believe what it cost them to make computers. Now granted HP is a much larger company, they still manufacture all there computers in Taiwan, and it would make you sick if you knew how much it cost to manufacture the product. Mr. Carey will tell you it cost them that much to justify any increased costs, or in this case, the need to increase early termination fees. Electronics are the most inflated product sold in the U.S.
> Don`t get me wrong, I am a big D* fan, but I would bet the farm that it`s no where near the $400 stated to manufacture the box........


He didn't tell *me* that, he told the investors that. I do believe that to be the actual manufacturing cost.

By the way, you have a farm?


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## surfmaui03 (Feb 26, 2005)

hilmar2k said:


> He didn't tell *me* that, he told the investors that. I do believe that to be the actual manufacturing cost.
> 
> By the way, you have a farm?


Yeah, I understand that he didn`t tell you. I`m telling you, there is no way it cost even close to that to manufacture. Yes, I do have a farm, the funny farm!:new_Eyecr


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## Guest (Oct 17, 2007)

techieguy23 said:


> I think the commitments are still cheaper in the long run than what cable charges PER BOX, PER MONTH!


Correct, the cable companies hit you with all sorts of extra charges. Last time I checked the Comcast pricing, a 2-DVR setup like what I have with DirecTV would cost an extra $15 per month.


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## JLucPicard (Apr 27, 2004)

Is D* the only company out there that people expect should sell their equipment to the customers at cost???

I read it all the time, "No way it costs them that much to manufacture those things" etc. Even the allusion to "you wouldn't believe what it costs HP to manufacture computers." How many companies actually sell their products to the consumer for cost? And why do people think DirecTV should?

"Why don't they make a good product and people would stay with them?" Valid question on the surface and I haven't been a customer of DirecTV since 1996 because they had me locked into any kind of commitments. I've been a customer because they have provided me a service I appreciate, enjoy, and feel is worth what they charge me for it (and I'm certainly NOT made of money). If DirecTV was to do away with their commitments, I'd bet surfmaui03's farm that the vast majority of people that would leave would not do so because they were necessarily unhappy with the equipment, the service (once they get beyond the installs) or even the pricing but because company A or B or C will give them X, Y, and Z to leave and sign on with them for a six-month reduced rate or something.

There will be a few people that may get nailed through no fault of their own, but there are a lot of people who will jump here, then there, then back over there again just chasing deals. Why do you think DirecTV (and others) have instituted the commitment policies in the first place? I say it's the deal chasers. Your opinion may vary.


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## surfmaui03 (Feb 26, 2005)

rcoleman111 said:


> Correct, the cable companies hit you with all sorts of extra charges. Last time I checked the Comcast pricing, a 2-DVR setup like what I have with DirecTV would cost an extra $15 per month.


Yep! I check out the competitors prices once in a while, E* is more, for less equipment and progarmming, and my cable company(charter) would cost me $30 more per month than D*, for the same type of setup and progamming (except less HD programming with charter). D* is the best value IMHO. I don`t see myself going anywhere, so to me me, the increased termination fees won`t affect me.


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## Tom Robertson (Nov 15, 2005)

surfmaui03 said:


> Sorry, but that`s pure BS. There is no way it costs them $400 to manufacture this box. I work for HP, and you wouldn`t believe what it cost them to make computers. Now granted HP is a much larger company, they still manufacture all there computers in Taiwan, and it would make you sick if you knew how much it cost to manufacture the product. Mr. Carey will tell you it cost them that much to justify any increased costs, or in this case, the need to increase early termination fees. Electronics are the most inflated product sold in the U.S.
> Don`t get me wrong, I am a big D* fan, but I would bet the farm that it`s no where near the $400 stated to manufacture the box........


Remember, HP is buying every single component that is found in 30M computers manufactured this year. Every chip is sourced under multi-million part orders. Those assembly lines are tuned to perfection. HP can spend millions to find ways to make each computer $1 cheaper at each stage.

And PCs have minimal new development costs (per unit). They already know what a PC has inside. I can design and build one if I wanted.

On the other hand, the satellite tuners, the DVR CPU/video/etc. chips, the satellite decoders, etc. are not sold under million part orders. (Ok, likely high hundreds of thousands.) Some of these chips just don't appear anywhere other than a DIRECTV receiver. Some only can be used in a DIRECTV or Dish receiver.

Don't forget, at this stage, each new DVR has significant development costs that need covering. Again, not at 10s of millions of units sold, but hundreds of thousands. Big difference in economies of scale.

Cheers,
Tom


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## surfmaui03 (Feb 26, 2005)

JLucPicard said:


> Is D* the only company out there that people expect should sell their equipment to the customers at cost???
> 
> I read it all the time, "No way it costs them that much to manufacture those things" etc. Even the allusion to "you wouldn't believe what it costs HP to manufacture computers." How many companies actually sell their products to the consumer for cost? And why do people think DirecTV should?
> 
> ...


No argument there, the commitment policies are needed! No reasonable person should expect equipment for free. D* is a buisness, and they are there to make money.


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## tuff bob (Mar 5, 2007)

bigref said:


> Then get rid of your cell phone also.


Does your cellphone company lease you the cell phone? Thought not.


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## hilmar2k (Mar 18, 2007)

surfmaui03 said:


> Sorry, but that`s pure BS. There is no way it costs them $400 to manufacture this box. I work for HP, and you wouldn`t believe what it cost them to make computers. Now granted HP is a much larger company, they still manufacture all there computers in Taiwan, and it would make you sick if you knew how much it cost to manufacture the product. Mr. Carey will tell you it cost them that much to justify any increased costs, or in this case, the need to increase early termination fees. Electronics are the most inflated product sold in the U.S.
> Don`t get me wrong, I am a big D* fan, but I would bet the farm that it`s no where near the $400 stated to manufacture the box........


One more thought on this topic: since Chase was telling his investors about the cost of the HR20, why on Earth would he lie on the high side? It is in his, and his invetsors, best interest to keep the manufacturing costs low.

And by the way, had you listened to the conference call, you would have heard that Chase gave out that number as something he was proud of, that the costs had come down to the mid $400 range. But he said he wasn't satisfied with that, and that he wanted to get it down to near $300.

Bottom line, he isn't going to lie to his investors in a way that makes him look bad. That's just stupid.


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## Earl Bonovich (Nov 15, 2005)

tuff bob said:


> Does your cellphone company lease you the cell phone? Thought not.


No... but they also don't have one cancelation fee for the entire account... it is per line, and it isn't pro-rated...


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## hilmar2k (Mar 18, 2007)

tuff bob said:


> Does your cellphone company lease you the cell phone? Thought not.


Do they not charge for additional lines? That's all D* is doing. They just renamed the mirror fee to a lease fee.


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## Lee L (Aug 15, 2002)

JeffBowser said:


> It needs to be repeated endlessly, it seems. These two year committments are needed to subsidize the costs of the equipment, service, and installations. I subscribed to DirecTV back before committments. I paid over a couple thousand to get going with 4 advanced (for back then) receivers, dish, and install. Man, what a testimony against my old cable company that is.


I understand basic economics and have no problem with them setting whatever fees they want if they are able to bee seen up front. However, since the way DirecTV is doing things requires you to call at some point (and this is when you decide to go forward based on information at that time), then have the actual activation later, the terms should relate to the day the agreement to take the equipment was made, not when DirecTV gets around to giving it to you.

In fact, I wonder if any change under the situation I described would be legally enforceable anyway, not that it is worth the time and energy to actually contest the charges.


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## Earl Bonovich (Nov 15, 2005)

surfmaui03 said:


> Sorry, but that`s pure BS. There is no way it costs them $400 to manufacture this box. I work for HP, and you wouldn`t believe what it cost them to make computers. Now granted HP is a much larger company, they still manufacture all there computers in Taiwan, and it would make you sick if you knew how much it cost to manufacture the product. Mr. Carey will tell you it cost them that much to justify any increased costs, or in this case, the need to increase early termination fees. Electronics are the most inflated product sold in the U.S.
> Don`t get me wrong, I am a big D* fan, but I would bet the farm that it`s no where near the $400 stated to manufacture the box........


So what is your estimate it takes them to build the HR20 systems?


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## oakwcj (Sep 28, 2006)

Let's not forget that they're not selling us the HR20. At this point, at least, they want them back and recycle them to other customers, thereby further reducing their costs. I do understand that a corporation needs to make a reasonable profit to stay in business and that Ruppert Murdoch [aka Mr. Burns] didn't think DirecTV was profitable enough and called it a "turd bird." He then turned around and negotiated a fancy-schmancy non-taxable exchange of assets with Liberty. Let's just be realistic about it. DirecTV is not some fairy godmother company working to keep our costs down. They will charge whatever they think the market will allow them to in a manner designed to maximize profit. And while we all enjoy testing stuff for them, we're performing a service that they would otherwise have to pay for.


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## spoonman (Feb 21, 2007)

hilmar2k said:


> Do they not charge for additional lines?


Yes they do...when I had enough of Verizon it cost me $175 for each line I had with them to break contract.


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## surfmaui03 (Feb 26, 2005)

Tom Robertson said:


> Remember, HP is buying every single component that is found in 30M computers manufactured this year. Every chip is sourced under multi-million part orders. Those assembly lines are tuned to perfection. HP can spend millions to find ways to make each computer $1 cheaper at each stage.
> 
> And PCs have minimal new development costs (per unit). They already know what a PC has inside. I can design and build one if I wanted.
> 
> ...


Very true, but computers are constantly changing. You should see some of the things they are developing. Many of the business systems are now sff(small form factor) and tons of R&D are going into them. These things are getting so small, they are getting close to looking like lap tops. The heat issues are a constant battle, since they are so small, and there is not much room for cooling, or the typical components found in a "best buy" store bought computer. As far as the assembly lines being tuned to perfection, that's just not true. You would be surprised at the rate of damaged and d.o.a. systems due to the assembly lines that arrive to consumers and businesses, not only from HP, but other manufactures. Like I said before, I know companies like HP have been around a lot longer, and have produced far more systems than D* boxes, but the cost to manufacture these electronics is far lower than you can imagine. Don`t forget HP also makes plasma TV`s, which you would fall over if I could yell you how much it cost to manufacture them. New technology often comes at a higher price because the consumers are willing to pay top dollar for the "newest" thing, not necessarily because it cost more to make


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## Ken S (Feb 13, 2007)

oakwcj said:


> Source, please.


DirecTV has made statements regarding the cost of the DVRs during their financial conference calls. IIRC the cost has actually dropped below $400 and should be close $300 by year's end. That doesn't include dish, cabling, etc.

Here's a piece of the transcript from their Q2 2007 Conference Call

_Chase Carey

Again, I think what we are trying to -- I mean, some of this as we get some actual results under our belt as opposed to just projections, I think we will continue to sort of determine what makes sense. I think the way I guess I would look at it today is in the second half of the year, the incremental cost for an HD box versus a DVR box versus the basic box is about $100. We are going to be -- we'll have an HD box that will be under $150 in the second half of the year, the basic box is $50, a touch under $50.

Essentially that amount we get and we charge a customer $99 to get that box, so we are whole against what would be the economics of a basic box, and we are charging then $5 for that box to go into a home. I think we will wrestle with how many homes are taking more, what is the trend there and how do you address that.

But I think in a simplistic sense, the way I guess I'd look at it is we are getting an HD increment against the home and essentially keeping ourselves economically whole for an advanced set-top box.

In reality with a DVR, with the HD DVR dropping -- right now we charge $299 if you go to a second one of those. The HD DVR is going to be not much above $300 by the end of the year and it is going to be in the mid $200s by the middle of next year, so in some ways that is actually going to end up being above what is cost.

But again, I think going into it philosophically, what we've looked to do is recapture up front so there is not an incremental investment, you know, the cost for that advanced equipment. I think we will continue to try and evaluate what's the right -- what's the demand for what mix of product and how do we optimize the opportunity. _


Here's a link to the whole thing...


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## surfmaui03 (Feb 26, 2005)

hilmar2k said:


> One more thought on this topic: since Chase was telling his investors about the cost of the HR20, why on Earth would he lie on the high side? It is in his, and his invetsors, best interest to keep the manufacturing costs low.
> 
> And by the way, had you listened to the conference call, you would have heard that Chase gave out that number as something he was proud of, that the costs had come down to the mid $400 range. But he said he wasn't satisfied with that, and that he wanted to get it down to near $300.
> 
> Bottom line, he isn't going to lie to his investors in a way that makes him look bad. That's just stupid.


And no one has ever lied to their investors? Bottom line, is start with a high number, and you can come out ahead. I`m not looking to disect every angle here, my point is, I can`t see it costing that much to manufacture these boxes, not by a large company like D*.


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## gregjones (Sep 20, 2007)

The reason HP can make the PC so cheaply is that it is only dealing mostly in hardware. HP has outsourced the operating system to others (most often Microsoft). You cannot add up just the hardware components and expect the cost to be complete.

The folks that develop the software for the HR20 expect to get paid as well. Where the development cost for Windows is split among milllions and millions of licenses, that does not happen yet on HR20 software. Microsoft will still charge you $100 extra (at least, for OEM) per license for Windows in spite of the much larger install base.

If you would like a clearer idea of what it costs to build a similar DVR product, build one from the ground up. You can use MythTV and avoid paying for any of the software. If you can get all the required components for just recording two HD OTA feeds with reliable playback quality for under $300, I would be impressed.


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## surfmaui03 (Feb 26, 2005)

Earl Bonovich said:


> So what is your estimate it takes them to build the HR20 systems?


My estimate? I would say $150-$200 tops. I might be wrong, but I just can`t see it costing them in the mid $400`s as stated. :nono2:


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## surfmaui03 (Feb 26, 2005)

gregjones said:


> The reason HP can make the PC so cheaply is that it is only dealing mostly in hardware. HP has outsourced the operating system to others (most often Microsoft). You cannot add up just the hardware components and expect the cost to be complete.
> 
> The folks that develop the software for the HR20 expect to get paid as well. Where the development cost for Windows is split among milllions and millions of licenses, that does not happen yet on HR20 software. Microsoft will still charge you $100 extra (at least, for OEM) per license for Windows in spite of the much larger install base.
> 
> If you would like a clearer idea of what it costs to build a similar DVR product, build one from the ground up. You can use MythTV and avoid paying for any of the software. If you can get all the required components for just recording two HD OTA feeds with reliable playback quality for under $300, I would be impressed.


Yeah, I understand what you are saying. I never said D`s cost is the same as HP, or any other Computer manufacture for that matter. I said electronics are the most marked up product here in the U.S., and I don`t believe it costs D* that much to manufacture their boxes. I simply stated you would not believe how cheap it really is to manufacture electronics. There is no way I could build a similar DVR from the ground up. I don`t have resources like HP and D*. You are comparing apples to oranges here my friend. I have to pay retail prices for the parts. I do not have a manufacturer to go to in a country, that will charge me pennies to make the components I need.


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## tuff bob (Mar 5, 2007)

Earl Bonovich said:


> No... but they also don't have one cancelation fee for the entire account... it is per line, and it isn't pro-rated...


but you don't have to send back your cell phone if you've completed your commitment.


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## Earl Bonovich (Nov 15, 2005)

tuff bob said:


> but you don't have to send back your cell phone if you've completed your commitment.


No... has anyone had to send back any of their equipment that they completed their commitment on?

I would have gladdly sent T-Mobile back my phones... if it ment I didn't have to pay the $250 per line..
Considering they now are sitting in a drawer... waiting for me to take them to a cell-phone recycle box...

As compared to "todays" phones, by semi-new phones are "old" and the value they would fetch via eBay or CraigsList... isn't worth the hassle.


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## Dolly (Jan 30, 2007)

I'm committed to D forever anyway :lol: In fact I think they own my bank account


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## surfmaui03 (Feb 26, 2005)

Dolly said:


> I'm committed to D forever anyway :lol: In fact I think they own my bank account


Exactly! No better provider around IMHO!


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## bonscott87 (Jan 21, 2003)

surfmaui03 said:


> My estimate? I would say $150-$200 tops.


Maybe for just the HD encoders.


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## JeffBowser (Dec 21, 2006)

Costs of that box also include recouping your engineering costs, and often licensing fees when you use patented and/or copyrighted technology from other companies. Further, if the box is made in China, you have import duties, various shipping fees, and palm greasing. The actual cost of parts at times can be downright trivial against these other costs.


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## cariera (Oct 27, 2006)

surfmaui03 said:


> My estimate? I would say $150-$200 tops. I might be wrong, but I just can`t see it costing them in the mid $400`s as stated. :nono2:


Again, you have no idea what it costs you are just guessing. Just because you can't see it costing in the mid $400s, doesn't mean it doesn't. Maybe Chase is include the ancillary costs like installation, dish, multiswitches, etc.

Bottom line is that you just don't know, and until you do there is no reason to doubt the information given out by the CEO of the company.

Also, if you don't like the terms or the potential cancelation fee - don't get new equipment after the 17th. It really is that simple.

Vote with your wallet,


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## schlar01 (Jul 16, 2007)

cariera said:


> Also, if you don't like the terms or the potential cancelation fee - don't get new equipment after the 17th. It really is that simple.
> 
> Vote with your wallet,


I probably will, unfortunately. It isn't that I don't like DirecTV. Its that I don't want more contracts with higher cancellation fees. I'd like to be able to upgrade to an HD DVR without giving D* my first born. I don't think I'm asking too much. After a certain amount of time with a company you shouldn't have to sign yet another contract. I'd be perfectly fine with giving all the equipment back......I just don't want even more conditions attached to what should be a fairly simple upgrade process.


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## Jhon69 (Mar 28, 2006)

surfmaui03 said:


> My estimate? I would say $150-$200 tops. I might be wrong, but I just can`t see it costing them in the mid $400`s as stated. :nono2:


They did have one for $150. but they had to send it back.It had LEAD in it!!.:lol:


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## rlgold88 (Aug 30, 2006)

Why do all my hr20's say they are made in mexico if they are made in china????


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## surfmaui03 (Feb 26, 2005)

cariera said:


> Again, you have no idea what it costs you are just guessing. Just because you can't see it costing in the mid $400s, doesn't mean it doesn't. Maybe Chase is include the ancillary costs like installation, dish, multiswitches, etc.
> 
> Bottom line is that you just don't know, and until you do there is no reason to doubt the information given out by the CEO of the company.
> 
> ...


You`re right, I am guessing. But the fact that I am involved in a company that also produces electronic equipment, which uses some of the same types of components, gives me a general idea of manufacturing costs, in MY opinion. Do you think D* would lease out a box for $99-$199, when it costs them in the mid $400 range to manufacture? No way they will lose money on equipment that costs them that much, and shoot for making it up in programming. If that was the case, it would cost us more than that to lease these boxes upfront, and\or per month. No company will lose money, or break even on ANY product they put out, period! I have no need for new equipment now. Maybe in the future, but I never complained about the costs, or termination fees. While I don`t agree with an increase, it wouldn`t be a deal breaker for me either.


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## surfmaui03 (Feb 26, 2005)

rlgold88 said:


> Why do all my hr20's say they are made in mexico if they are made in china????


I`ve never looked, but maybe the parts are manufactured in China, and then assembled in Mexico? Many companies do this.


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## hasan (Sep 22, 2006)

Having been a D* customer since 1994 and paying 999 bucks for the first receiver, I'm probably outside the norm for most people on the forum.

Unless I'm misreading something, as long as I intend to keep the service for at least two years after getting a new receiver et al, none of the concerns expressed so far apply to me, or others with similar inclinations. 

If you are getting in with the intention of preserving a way to get out early at a low cost, then you have reasons to be concerned. Otherwise, it's ho-hum as far as I can tell. Am I missing something?

I have a similar arrangement with Verizon: every 2 years I get two new phones of my choosing free, as long as I extend my contract 2 years. Since I intend to keep Verizon for that period, all I see is two new phones. 

Neither of these arrangements would be appealing to a "testing the water" customer, but to someone who knows exactly what they want, they seem satisfactory to me.


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## surfmaui03 (Feb 26, 2005)

Jhon69 said:


> They did have one for $150. but they had to send it back.It had LEAD in it!!.:lol:


 :lol:


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## Ken S (Feb 13, 2007)

hasan said:


> Having been a D* customer since 1994 and paying 999 bucks for the first receiver, I'm probably outside the norm for most people on the forum.
> 
> Unless I'm misreading something, as long as I intend to keep the service for at least two years after getting a new receiver et al, none of the concerns expressed so far apply to me, or others with similar inclinations.
> 
> ...


hasan,

There's a difference though. When you get a mobile phone service contract the major items such as minutes, cost, data use, etc are stated and locked in.

DirecTV, on the other hand, wants to hold people to a two-year commitment AND have the freedom to change/delete programming, raise rates, change contract terms, add fees, etc.
Their latest agreement states that if you don't agree to a change you may cancel BUT you may be charged an early termination fee.

Personally, I think they would have a hard time enforcing that section depending on the changes they make, but very few consumers are going to go to court over the matter.


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## Upstream (Jul 4, 2006)

Ken S said:


> Raising cancellation fees is just less expensive than providing high customer satisfaction.


Actually I wonder if there is a profit motive in getting customers to cancel.

For example:

If I upgrade to a DTV HD DVR, I have to pay DTV an upfront fee of $300.

If I keep the box for 8 months and then decide to cancel, I have to also pay a $320 cancellation fee ($20 x 16 months).

So they end up with $620 cash, plus I have to send the box back and they can reuse it with another customer.

(Compare this to the retail price at Circuit City for an HD Tivo, $300, or an HD Series 3 Tivo, $600. But the purchaser gets to keep those boxes.

So by inticing me to cancel, DTV ends up with the cash equal to the full retail value of the most sophisticated Tivo, plus they also have the box.

I don't have a problem with DTV structuring their cancellation fees to discourage churn and recoup their costs. But I get concerned when I see that it is more profitable for them to get customers to cancel instead of providing quality customer service.


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## Ken S (Feb 13, 2007)

Upstream said:


> Actually I wonder if there is a profit motive in getting customers to cancel.
> 
> For example:
> 
> ...


Their customer acquisition cost is somewhere around $675 (up about 5% from last year)...I don't think they're making money when they lose a customer.

Their churn rate sits about 1.6%/month (25,000 customers is a lot to replace as the overall market grows more and more mature.)...that number has to come down to keep the financial markets happy.


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## Elephanthead (Feb 3, 2007)

These fees have nothing to do with the cost of equipment, they are all about preventing you from being able to switch providers. The worst part is DirecTV insists that their CRS people lie to you about the reason for the fees. Anyway, you pay your money and if you don't like, do agree to it, they clearly mention the fees when you activate. You recover it with cheaper monthly subscription costs, and if you paid for your equipment, you got suckered. Anyway thank goodness for OTA digital, yippe, more beer money for me!


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## bonscott87 (Jan 21, 2003)

Dish has 18 month commitment.
Even cable has 12-24 month commitments (just try to drop that triple play pack early...ouch!)


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## randyk47 (Aug 21, 2006)

Been with D* for 8+ years and will be with them until I'm boxed up and carried out of the house.  Cancellation fees really don't bother me much.


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## hasan (Sep 22, 2006)

Ken S said:


> hasan,
> 
> There's a difference though. When you get a mobile phone service contract the major items such as minutes, cost, data use, etc are stated and locked in.
> 
> ...


Yep, I think the advance lock-in with escalating prices is legally unenforcable, but the cost of personally asserting one's rights might exceed the unfair increase they are trying to get in the first place. We do have our surrogates, however (see last paragraph)

Since you aren't paying in advance, they would have to come after you for the money and that gives you some advantage, but it could still be a real nasty experience.

I differentiate that problem from getting a product from D* that plainly does not deliver what is promised and has no potential to do so. That's a no lose situation, and the lawyers at D* ain't stupid.

Every contract requires at least "consideration" and "consent/meeting of the minds". If the company doesn't deliver the consideration promised, there is no contract. If the consumer doesn't consent, there is no contract, either.

I suppose, under the scenario you describe D* could triple the cost of services within your two year commitment and they would argue that you couldn't get out of it. You and I agree, that is not likely to fly, and any State Attorney General worth his/her position would eat them for lunch (so it wouldn't be your court battle/court costs).

All that aside, in the many years of dealing with D*, I have never felt taken advantage of in terms of fairness. Their communication quality leaves something to be desired at times, as do some of their marketing practices (not illegal, but strange, to say the least).

All the hysteria about the HD Extra package will either be debunked or justified, depending on how things shake out with channel moves/distribution and costs come the end of the year. Some of the scenarios speculated upon have a "bad smell" to them.


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## JLucPicard (Apr 27, 2004)

Upstream said:


> Actually I wonder if there is a profit motive in getting customers to cancel.
> 
> For example:
> 
> ...


The math seems pretty simple to me - maybe I'm missing something.

$300 up front cost for the equipment/install. $20 a month for each month you get them to cancel early.

VERSUS

$300 up front cost for the equipment/install. $30-$120 a month for each month they subscribe to any one of the packages available to them.

Seems to me the $30-$120 a month trumps the $20 a month early cancellation fee. I just can't see your scenario - sorry.


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## boba (May 23, 2003)

rlgold88 said:


> Why do all my hr20's say they are made in mexico if they are made in china????


I would guess your manufacturer code is 100 (HR20-100) RCA is the manufacturer and they assemble in Mexico with parts from all over the world. I believe 700 is PACE which is a Chineese manufacturer.


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## Ken S (Feb 13, 2007)

hasan, 

I don't totally disagree with you by any means, but...

1. We do pay in advance...we pay for DirecTV one month in advance. The upfront lease fee on the equipment is also an advance payment...is it not? I think I read where most of their customers pay with credit cards kept on file or EFT type transfers.

2. I didn't make up the scenario...it's directly from the DirecTV user agreement. If they raise prices (or change any other term) you DO have the right to cancel...you just have to pay an early termination fee. By continuing to receive the service (not cancelling) you agree to the new terms. Continuing to provide the service is their consideration (at least in their minds). Clearly, this is an agreement of adhesion and may not stand up in court...but the new corporate law mentality is to threaten and then if pressed back off with non-disclosed settlements.

Sure, you can file a complaint with your state AG, but most likely DirecTV will "settle" with anyone who starts to go that far and probably silence the complaint. 

I've been to the seminars where this type of activity is "discussed". Believe me...DirecTV isn't the worst offender by a long shot. You want to see real filth take a look at some alarm monitoring service companies.

Anyway, as with the text of their maintenance agreement, they don't have to enforce their rather harsh terms...and they very well may not...at least for now. But, the management/ownership door at DirecTV has swung several times in recent years and a whole new administration could be in place and have an entirely different view.

As for the the HD Extra package...it comes down to this. DirecTV is measured by Wall Street on how much money it makes and/or will make. As the market matures and subscriber growth rates slow they have to increase the monthly revenue per customer. That's what the HDDVR is all about and that's what the new satellites are all about. Guess what...it's going to keep going up...it has to. My prediction (based on my all too large gut feel) is we're looking at $100/month average bills in the next three years (it stands about $75 now up from about $65 a year ago).

Those increases will be called something...that's up to the marketing department...but they're coming because unless you're showing the analysts a plan for solid growth year over year the stock will go down (it already has) and the real owners won't be happy.


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## oakwcj (Sep 28, 2006)

randyk47 said:


> Been with D* for 8+ years and will be with them until I'm boxed up and carried out of the house.  Cancellation fees really don't bother me much.


Assuming that it will be a long time before you're boxed up -- and I hope that it is -- how can you possibly see that far ahead with your crystal ball? I'm sure that there will be new internet-based video delivery services within the next decade. At the moment, I agree that D* is, to paraphrase Winston Churchill, the worst possible TV provider, with the exception of all the others.


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## hasan (Sep 22, 2006)

Ken,

"Those increases will be called something...that's up to the marketing department...but they're coming because unless you're showing the analysts a plan for solid growth year over year the stock will go down (it already has) and the real owners won't be happy."

That's a cold-hearted capitalist analysis, if I ever have seen one. 

(notice, I am not disputing its accuracy)


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## ghostdog (Jul 6, 2007)

schlar01 said:


> This stuff is just ridiculous. I signed up a few months ago but didn't want to spend the $300 to get the HD DVR. Now if I want one I need to basically get ripped off for the up front fee AND go back to a full two years AND have a higher cancellation fee? It really makes me want to not stay with D* once my contract expires. I'm overall only OK with the product so far. I love the Sunday Ticket in HD and the extra HD channels but I hate the H20 receivers. I hate the 2-3 second lag when I push any button and I hate the sensitive nature of the buttons when it does go through. Sometimes I can push a button with no response, other times I'll push it and the receiver will put three 2s up. IMO its just not a good product. The $700 price to purchase the equipment is BS, too. It costs nowhere near that to manufacture it. My guess is that the cost of the HD DVR, since its made in China, costs significantly less than the $299 they were charging.
> 
> Sorry for the rant but I hate it when companies try to up their contracts. I hate cell phone companies, too.


Call back and talk to retention. If you really want an HD DVR I bet you can get one for $99 even if you are a newcomer. 
With that deal however you will have a two year commitment.


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## Mikey Palmice (Oct 16, 2007)

okietekkie said:


> Would not matter if they ordered it tonight. Commitment is added when the receiver is activated.


wait, I ordered yesterday and they told me 300 dollars for 24 months contract. 12 dollars or so per month prorated. Can they just change what they said to me and make it 20 dollars per month like above?


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## Pink Fairy (Dec 28, 2006)

I am sure that they will have to make exceptions when it comes to those who ordered before the new contracts started but activated eqiupment after.


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## tealcomp (Sep 7, 2007)

surfmaui03 said:


> Sorry, but that`s pure BS. There is no way it costs them $400 to manufacture this box. I work for HP, and you wouldn`t believe what it cost them to make computers. Now granted HP is a much larger company, they still manufacture all there computers in Taiwan, and it would make you sick if you knew how much it cost to manufacture the product. Mr. Carey will tell you it cost them that much to justify any increased costs, or in this case, the need to increase early termination fees. Electronics are the most inflated product sold in the U.S.
> Don`t get me wrong, I am a big D* fan, but I would bet the farm that it`s no where near the $400 stated to manufacture the box........[/QUOTE
> 
> +1


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## tealcomp (Sep 7, 2007)

Upstream said:


> Actually I wonder if there is a profit motive in getting customers to cancel.
> 
> For example:
> 
> ...


That is EXACTLY the argument I made with retentions; I said, look I don't mind signing a commitment, but you are going to HAVE to make it worth my while..Directv is a business not a charity and I am not giving a company (that I have been with for nearly 12+ years) yet another 2 year commit without something in return. So, I like others might be the cause of this increase since they gave so many of these boxes away to keep us from bailing out. Of course, now that the channels are live, they might say adios 

-Dan


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## pdicamillo (Sep 28, 2007)

bonscott87 said:


> Maybe for just the HD encoders.


I don't know if you meant the decoders, but there are no HD encoders. Both satellite and digital OTA (DTV) are broadcast already encoded in MPEG-2 or MPEG-4. That's why there's no recording quality setting as on standalone Tivos. The recording is an exact copy of the broadcast.


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## tealcomp (Sep 7, 2007)

surfmaui03 said:


> No argument there, the commitment policies are needed! No reasonable person should expect equipment for free. D* is a buisness, and they are there to make money.


Actually, I disagree; if they want a new commitment out of me, they are going to have to give me something in return...personally I think that is why the commitments are there in the first place; and I don't intend to go anywhere unless their new service takes a significant dump and I do not think that is likely to happen. Two years will have come and gone before I blink an eye...

-Dan


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## tealcomp (Sep 7, 2007)

spoonman said:


> Yes they do...when I had enough of Verizon it cost me $175 for each line I had with them to break contract.


Ah Verizon "we never stop finding new ways to charge you for things we broke in the phones firmware, so we could sell it to you as an "add-on"


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## Upstream (Jul 4, 2006)

Ken S said:


> Their customer acquisition cost is somewhere around $675 (up about 5% from last year)...I don't think they're making money when they lose a customer.
> 
> Their churn rate sits about 1.6%/month (25,000 customers is a lot to replace as the overall market grows more and more mature.)...that number has to come down to keep the financial markets happy.


You would think that DTV would be most profitable by retaining customers and getting the monthly service check, instead of relying on equipment upfront fees and cancellation charges.

But then you would expect that they would tell a 10 year customer looking to upgrade to HD that they could get the equipment with no upfront charge and no commitment. But the message of "$300 upfront plus another $300 if you cancel" is basically a message of "even though you've been a loyal customer for 10 years, we don't have confidence that we will be able to satisfy you in the future".

(Of course, based on my experience with the R15, I have to admit that I am also not confident that DTV can meet my expectations, which is why I am reluctant to spend $300 and commit for 2 years to upgrade to an HR20.)


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## tealcomp (Sep 7, 2007)

surfmaui03 said:


> Very true, but computers are constantly changing. Don`t forget HP also makes plasma TV`s, which you would fall over if I could yell you how much it cost to manufacture them. New technology often comes at a higher price because the consumers are willing to pay top dollar for the "newest" thing, not necessarily because it cost more to make


They actually "manufacture" their own panels?? , or do they just take an OEM panel and slap the HP label on it? Very few companies actually manufacture the panels, but I suppose HP could make the electronics for the panels.


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## Jolliec (Sep 1, 2006)

surfmaui03 said:


> Sorry, but that`s pure BS. There is no way it costs them $400 to manufacture this box. I work for HP, and you wouldn`t believe what it cost them to make computers. Now granted HP is a much larger company, they still manufacture all there computers in Taiwan, and it would make you sick if you knew how much it cost to manufacture the product. Mr. Carey will tell you it cost them that much to justify any increased costs, or in this case, the need to increase early termination fees. Electronics are the most inflated product sold in the U.S.
> Don`t get me wrong, I am a big D* fan, but I would bet the farm that it`s no where near the $400 stated to manufacture the box........


What about R&D, packaging, advertising, support, distribution, warranty, overhead, etc.

It all goes into the "cost" of a product.


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## ThomasM (Jul 20, 2007)

You have to look at this "commitment" issue from the DirecTV viewpoint.

1. There are a LOT of leakers out there today who don't pay their bill and accept offers from satellite TV providers (and cellphone companies) and then get expensive equipment at a fraction of it's cost (or even for free) and never return it or comply with the terms of the contract they signed.

2. The TV business is VERY competitive nowadays! The local cable company (Time-Warner) actually had a pest stop by to try and talk me out of my satellite TV subscription with the offer of their usual "digital phone/high speed internet/digital cable" package for $90/month with a TWO YEAR price guarantee!! Unfortunately, I know that 90% of the channels offered were still analog, their "high speed internet" wasn't that high speed when the kids get home from school, and their "digital phone" was a glorified VOIP service that often didn't provide dial tone when all the kids were tying up the local bandwidth-and of course it didn't work at all in the event of a power failure. But a lot of folks would consider it IF they didn't have a commitment from their satellite TV provider.

3. The equipment DirecTV gives customers costs them plenty-just like the cellphones you get for "free" or a very small cost in exchange for a commitment. Actually, if you just decide that you LIKE DirecTV, pay your bill, and decide that you are in for the long haul their prices are very fair. I purchased an RCA DirecTV receiver prior to the "leasing" days. I also bought the "extended warranty" program from Circuit City. When it expired after 3 years, they wanted ALMOST A HUNDRED DOLLARS to extend it!! You can get a replacement for a failed (leased) DirecTV receiver for twenty bucks. That's not bad.

The bottom line is that it costs these outfits a bundle to get a new customer or equip an old customer with new equipment. They want to keep that customer and the way to do it is with a commitment.


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## Ken S (Feb 13, 2007)

ThomasM said:


> You have to look at this "commitment" issue from the DirecTV viewpoint.
> 
> The bottom line is that it costs these outfits a bundle to get a new customer or equip an old customer with new equipment. They want to keep that customer and the way to do it is with a commitment.


A better way to do it is provide quality service at a competitive price. Always nicer having customers that WANT to be your customers. The whole industry stinks when it comes to customer satisfaction.


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## Blurayfan (Nov 16, 2005)

Earl Bonovich said:


> No... but they also don't have one cancelation fee for the entire account... it is per line, and it isn't pro-rated...


Two major cell carriers are now prorating the cancellation fees.
AT&T eases up on termination fees
Verizon to ease termination fees


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## BNUMM (Dec 24, 2006)

The manufacturing costs are not the only costs that go into the price of an item. There are the following: Transportation, packaging, salaries for the people who handle the equipment. Along with the people you get: Workmans compensation, unemployment, Social Security taxes, medicare taxes, health insurance, life insurance, and pension. The buildings for storing the equipment brings: Property taxes, utilities and maintenance. I am sure there are more.


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## Pink Fairy (Dec 28, 2006)

With US Cellular - the commitment is per PHONE!

We have 4 phones...and dont really have the option to turn one off till the commitment ends.

And it was an 18 month commitment per phone too.


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## CJTE (Sep 18, 2007)

okietekkie said:


> With US Cellular - the commitment is per PHONE!
> 
> We have 4 phones...and dont really have the option to turn one off till the commitment ends.
> 
> And it was an 18 month commitment per phone too.


T-Mobile is the same way.
Comittment is per line on the account.


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## Pink Fairy (Dec 28, 2006)

Suckage I say!

At least D* does not do it per receiver.


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## surfmaui03 (Feb 26, 2005)

tealcomp said:


> They actually "manufacture" their own panels?? , or do they just take an OEM panel and slap the HP label on it? Very few companies actually manufacture the panels, but I suppose HP could make the electronics for the panels.


Yes, we have panels made for us. While they are nothing special, they are manufactured for each model of HP\Compaq made. Same with the cases. Mother boards are made for HP, since most have an odd shaped MB, or way they fit into the HP case. All other parts are just cheap Taiwanese components, re-badged with HP logo stickers and HP spare part number stickers.


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## surfmaui03 (Feb 26, 2005)

BNUMM said:


> The manufacturing costs are not the only costs that go into the price of an item. There are the following: Transportation, packaging, salaries for the people who handle the equipment. Along with the people you get: Workmans compensation, unemployment, Social Security taxes, medicare taxes, health insurance, life insurance, and pension. The buildings for storing the equipment brings: Property taxes, utilities and maintenance. I am sure there are more.


Most of these do not apply, since they are manufactured in China, and some built in Mexico.


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## surfmaui03 (Feb 26, 2005)

Jolliec said:


> What about R&D, packaging, advertising, support, distribution, warranty, overhead, etc.
> 
> It all goes into the "cost" of a product.


Right, and programming is part of their product, is it not????? They are not losing money, or breaking even on equipment costs. Coming from a company that deals in the manufacturing and sales of an electronic product, I`m telling you, there is no way it is costing them that much to manufacture the hr20. If it did, our costs would be going up with each new release, and we wouldn`t get our boxes for $199. Believe what you want


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## surfmaui03 (Feb 26, 2005)

tealcomp said:


> Actually, I disagree; if they want a new commitment out of me, they are going to have to give me something in return...personally I think that is why the commitments are there in the first place; and I don't intend to go anywhere unless their new service takes a significant dump and I do not think that is likely to happen. Two years will have come and gone before I blink an eye...
> 
> -Dan


I agree.My point was, they are not going to spend the money to give you equipment, install it, then turn around and have you drop them because E*, or some other provider will offer you something a little better. That costs them money. I don`t think what they are asking is too much. I don`t like being in a commitment for 2 years, but I understand why they require it.


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## JLucPicard (Apr 27, 2004)

Ken S said:


> A better way to do it is provide quality service at a competitive price. Always nicer having customers that WANT to be your customers.


Funny, that describes how I feel about DirecTV - a quality product at a reasonable price.

_*Vote with your wallet! Vote with your wallet! Vote with your wallet!*_ (to be fair, not Ken S's quote, but used here on the board may times by many people)

I do, and that's why I've been a DirecTV customer for over a decade - and plan to be for a long time to come because of MY commitment to their product - not because of some "commitment" that I've signed an agreement to follow.


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## lman (Dec 21, 2006)

JLucPicard said:


> Funny, that describes how I feel about DirecTV - a quality product at a reasonable price.
> 
> _*Vote with your wallet! Vote with your wallet! Vote with your wallet!*_ (to be fair, not Ken S's quote, but used here on the board may times by many people)
> 
> I do, and that's why I've been a DirecTV customer for over a decade - and plan to be for a long time to come because of MY commitment to their product - not because of some "commitment" that I've signed an agreement to follow.


Apparently DTV doesn't feel that they have customers like you or they wouldn't make it so costly to terminate their service. I think their service was better when they had a higher quality DVR. I wish I got paid for not providing a service. I have been a customer for over 10 years, but am not as happy with DTV lately.


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## kmill14 (Jun 12, 2007)

Ken S said:


> DirecTV has made statements regarding the cost of the DVRs during their financial conference calls. IIRC the cost has actually dropped below $400 and should be close $300 by year's end. That doesn't include dish, cabling, etc.
> 
> Here's a piece of the transcript from their Q2 2007 Conference Call
> 
> ...


_

*So an HD DVR costs $150* and they charge anywhere from $0 to $99 to $299 for the right to use the box. The monthly lease on top of that is what...$4.99? (I won't even add in the $5.99 DVR fee  )

So even if I get the box for free (which I did), it would take 2.5 years to recover the cost. If I paid $99, it would take 10 months. Now I don't know what the DVR fee covers, and the lease fee is also justified in case your box fails.

Edit: So the early Cancel Fee is really not to cover the cost of the box, but to at least milk something out of the customer leaving early._


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## Ken S (Feb 13, 2007)

kmill14 said:


> *So an HD DVR costs $150* and they charge anywhere from $0 to $99 to $299 for the right to use the box. The monthly lease on top of that is what...$4.99? (I won't even add in the $5.99 DVR fee  )
> 
> So even if I get the box for free (which I did), it would take 2.5 years to recover the cost. If I paid $99, it would take 10 months. Now I don't know what the DVR fee covers, and the lease fee is also justified in case your box fails.
> 
> Edit: So the early Cancel Fee is really not to cover the cost of the box, but to at least milk something out of the customer leaving early.


Not sure what you're arguing...but the HDDVR does not cost $150. He's talking about an HD receiver. 
It costs DirecTV about $675 for each new subscriber. They're not going to do that in order to have them cancel and get the fee. Is that what you're really trying to suggest?

Their churn rate also stands at over 1.6% month (over 19% year)...that's the number they have to cut.


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## stogie5150 (Feb 21, 2006)

JLucPicard said:


> Funny, that describes how I feel about DirecTV - a quality product at a reasonable price.
> 
> _*Vote with your wallet! Vote with your wallet! Vote with your wallet!*_ (to be fair, not Ken S's quote, but used here on the board may times by many people)
> 
> I do, and that's why I've been a DirecTV customer for over a decade - and plan to be for a long time to come because of MY commitment to their product - not because of some "commitment" that I've signed an agreement to follow.


Me too. That's why I've been waiting for a month now for recovery kits for my DVR's. I am done with Directv. The latest email promises the kits will be here within 21 days. 21 days? Are you sending them on horseback? :lol: 
And then logging on here for the past few days and seeing....HD pack going up, now the commitment fee going up....looks like I made the right decision for my household.

And for those of you with Verizon-crippled phones, there is a place on the danged 'ol internet that you can go to and learn how to fix the phone that VZW screwed up, easily. If there only was a place I could go to fix all the problems with the HR20, I might have found a way to justify staying.

Directv is now no better than cable. Everything we hated about cable in 1996 when I signed up with Directv, Directv has now become. 

It was inevitable, now that I look back on it. There's just too much money out there and too many willing to overlook poor service and inferior equipment.

I thought I would miss it more than I do. I really don't miss it that much. What I really DON'T miss is that 100.00 bill every month. 

And I also don't miss waiting on that CE every week, hoping against hope that the things we begged Directv to fix on the DVR's would be fixed, the things they said it would do, it would actually DO. it Never happened. Instead we got pseudo-VOD, but only if you have internet available, and then you have to wait...and wait...and no hope of fixing the channels I get option, DLB, just a pipe dream.

Then they turn on a few part time HD channels, and all is forgiven. Slight-of-hand. Pay attention to the shiny lure over here....don't look over here...nothing to see here...


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## kaysersoze (Feb 28, 2006)

surfmaui03 said:


> And no one has ever lied to their investors?


They have, they being Enron, Tyco, Worldcom, Adelphia, etc....

There is this little group called the SEC who frown on these practices. (Feel free to insert LSU, Florida, or Auburn joke here _________________)



surfmaui03 said:


> Bottom line, is start with a high number, and you can come out ahead. I`m not looking to disect every angle here, my point is, I can`t see it costing that much to manufacture these boxes, not by a large company like D*.


I think Sony and Microsoft are pretty big.

http://www.gamespot.com/news/6144600.html

http://seattletimes.nwsource.com/html/businesstechnology/2002643486_xboxcosts24.html


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## gregjones (Sep 20, 2007)

surfmaui03 said:


> Right, and programming is part of their product, is it not????? They are not losing money, or breaking even on equipment costs. Coming from a company that deals in the manufacturing and sales of an electronic product, I`m telling you, there is no way it is costing them that much to manufacture the hr20. If it did, our costs would be going up with each new release, and we wouldn`t get our boxes for $199. Believe what you want


The software for each of the different receiver models is unique and has to be factored into the cost of each receiver. The software development cost itself for a DVR is significant. Software development is not cheap work and is more expensive the smaller the user base.

If you want the per unit cost of a DVR to go down, convince everyone you know to get one. For the same reason that large component orders lead to lower per unit prices, large user populations can defray the cost of software development.


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