NEW STUDY CONFIRMS: DBS BEATS DIGITAL CABLE ON VALUE, QUALITY AND CONSUMER SATISFACTION

ALEXANDRIA, VA, May 23, 2002 – The Satellite Broadcasting and Communications Association (SBCA) today issued top-line results from its SBCA 2002 Consumer Market Research Study.  The results were drawn from two major research studies.  The first explores consumer preferences and attitudes in the pay television market, and the second studies the opinions of new and current satellite television subscribers.  Conducted by The Taylor Research & Consulting Group (www.thetaylorgroup.com), the research demonstrates that direct broadcast satellite (DBS) continues to best cable, including digital cable, on value, quality and customer service.   Further, the study shows that  digital cable is far more susceptible to customer defection than is DBS.

“Despite the hopes and prayers of the cable industry that digital cable would be the killer application that would slow consumer defections to DBS, these studies confirm that DBS maintains a sizeable advantage in the most important customer categories --  value, quality and service,” said SBCA President Andy Wright.   “The research also shows that consumers continue to migrate to DBS because they believe that cable, including digital cable, cannot match the quantity and quality of programming offered by satellite television providers.  We were not surprised that cable price increases – which continue to far outstrip the rate of inflation – remain a major factor in motivating consumers to switch to DBS.  Perhaps most gratifying, we learned that DBS subscribers are almost twice as likely as digital cable subscribers to say they receive solid value from their service.”

The SBCA 2002 Consumer Market Research showed that DBS outscores digital cable for customer satisfaction in a number of specific performance measures.  On value for the money, DBS earns a 68  percent approval rating, while analog cable scores 37 percent and digital cable just 36 percent.  On signal transmission quality, DBS earns a 79 percent approval rating, while analog cable scores 67 percent and digital cable just 66 percent.  Finally, on making customers feel valued, DBS earns a 64 percent approval rating, while analog cable scores at 46 percent and digital cable at just 44 percent.

When new DBS subscribers were asked their reasons for subscribing to DBS:

•  38 percent stated that it was because DBS offered more channels

• 39 percent of those who have access to analog cable, and 40 percent of those with access to digital cable said that the fact cable television is too expensive contributed heavily to their decision to subscribe to DBS.

• 18 percent said that they subscribed to DBS because DBS’ clearer picture and sound.

• 13 percent indicated their decision to subscribe to DBS was motivated by their dissatisfaction with cable. 

      The research also shows that digital cable is far more susceptible to consumer defection than DBS, with 21 percent of digital cable subscribers expressing an interest in switching to satellite television.  Conversely, only 5 percent of DBS subscribers would consider switching to digital cable.  Overall, 57 percent reported that they had subscribed to cable in the past.

T   In the first quarter of 2002, DIRECTV, Inc. and DISH Network together gained 677,000 net new subscribers.  DIRECTV, Inc. activated 342,000 net new subscribers, bringing its cumulative subscriber base to 10.5 million. EchoStar Communications Corporation’s DISH Network added 335,000 net new customers, bringing their total subscriber base to 7.16 million.  Combined with the 752,942 C-band subscribers, satellite television boasts more than 18.4 million subscriber households, which equates to over 48.5 million viewers nationwide.

The competitive market study surveyed via telephone 1,006 randomly selected U.S. households; these households were equally divided among cable and DBS subscribing households.  The results of the competitive market study were weighted to reflect total U.S. households.  The new and current satellite television subscriber study surveyed via telephone 1,517 DBS subscriber households; roughly half of these households have subscribed to a DBS service for less than 3 months.  The results of the satellite television subscriber study were weighted to reflect the DBS universe at the time of the study. 

For more information on the consumer satellite services industry, please visit www.sbca.com.  To purchase a copy of both the Competitive Market Analysis and the New and Current Subscriber Study, please contact Eric Chang, SBCA senior marketing director, at 703-549-6990, or echang@satellite.org. 

The Satellite Broadcasting and Communications Association of America (www.sbca.com) is the national trade organization representing all segments of the satellite industry.  It is committed to expanding the utilization of satellite technology for the broadcast delivery of video, audio, data, interactive and broadband services.  The SBCA is composed of DBS, C-band, broadband, satellite radio, and other consumer satellite service providers, content providers, equipment manufacturers, retailers, encryption vendors, and national and regional distribution companies, that make up the consumer satellite services industry.