Advanced services such as DVR have high penetration in several markets

DirecTV Latin America has launched certain advanced services in the region, such as its DVR service and HD offering. The company is also planning to launch new set-top boxes in all markets across Latin America.

To find out more about the company's strategy for the region, BNamericas talked to company marketing, intelligence and research director Sandro Mesquita and Rudy Ramírez, who is the company's senior director for technology.

BNamericas: Tell us about the company's broadband strategy. You're already offering broadband services in the city of Mendoza, in Argentina. Are you planning to launch broadband in other countries across the Latin American region?

Mesquita: We have a strategy for broadband services. We believe that the broadband market in Latin America is an area that offers many possibilities when considering our TV and entertainment business. We offer boxes with a lot of possibilities in terms of content and interactivity if connected to broadband access. We started with broadband in Mendoza, where we're currently conducting a pilot for the service.

The truth is that we're doing very well with this trial. Prior to launching the pilot in Argentina, we wanted to know how difficult it would be to launch the service. We believe that the market has room to offer a quality service in line with our brand.

In the US market, DirecTV has agreements with telephony and broadband operators such as AT&T and Verizon, which have similar quality standards. There are markets where we have no alliances with operators, and there are growth opportunities. Our idea isn't to compete with large operators in the broadband segment, but we believe that there is room to grow in this market. We believe that the region is not fully served in terms of broadband services.

BNamericas: Are you currently testing broadband services in any other market across the region?

Mesquita: In Brazil, we did a technical test in capital Brasília with our Sky unit. We're also studying to do this in other markets, but again our main focus is the provision of TV services and entertainment to our customers.

BNamericas: According to a recent report published in Colombian press, the local unit of DirecTV is considering entering the mobile telephony segment through a mobile virtual network operator scheme in the future. What can you comment regarding this?

Mesquita: We can't comment on this issue.

BNamericas: Last year, DirecTV Colombia participated in an auction to obtain spectrum to position itself for a launch of mobile broadband services in the local market. [It did not win any spectrum, however.] Are you planning to participate in future auctions to win spectrum to launch mobile broadband?

Mesquita: When you have spectrum auctions, there is a possibility to offer more services. We want to be a relevant player for the good of our customers.

BNamericas: DirecTV launched prepaid TV services in several markets across the region. How does the company view this segment, and in which specific markets are you seeing more activity?

Mesquita: Over the last few years, we've experienced great success in the Venezuelan market in terms of prepaid acquisitions. We're also seeing many growth opportunities for the prepaid service in other markets across the region such as Argentina, Chile, Peru and Brazil.

Our prepaid service isn't exclusively for people within the lower-income segment. It's directed at customers who have a different financial behavior. For example, many of our prepaid customers in Venezuela don't have access to bank services. In these countries, we're really seeing many growth opportunities for our prepaid service.

BNamericas: DirecTV has been launching new features for its TV service in the US market. Which of these features will be launched across the Latin American markets in the coming months?

Ramírez: In the high-definition [HD] set-top box, we're already offering the double play feature, which allows subscribers to see two programs simultaneously. There are many other features that will be launched in Latin America, but we need first to adjust and update the HD set-top boxes to be able to offer these new features. We expect to start offering new features by the end of this year or the beginning of 2012.

In the US, DirecTV develops one feature at a time. However, once developed in the US, in Latin America we receive several new features and then have to see which ones can be launched and what we need to update in the boxes. This is why sometimes it takes time to launch the new features in the Latin American markets.

BNamericas: The company has announced that it plans to launch a more economic set-top box in Latin America, which will be mainly directed at lower-income segments. When are you expecting to commercially launch the product?

Mesquita: The set-top box will cost less compared to our standard box, but will maintain our traditional quality standards. We believe this new box will be available for Latin American markets in July this year. We're launching many features. The difficult thing is to communicate all these launches.

BNamericas: DTVLA is also seeing high demand for its DVR service, which allows the subscriber to record favorite movies, games or shows. Can you give us an indication of this service's penetration within the company's overall subscriber base?

Mesquita: We can't provide a specific number for this service. What we can say is that we're seeing increasing adoption of this service across our Latin American markets. This is one of the advanced services that we offer in the region. We also have DVR for our high-definition offering.

We can also say that the countries with the highest penetration of DVR services are Argentina, Venezuela, Chile, Puerto Rico and Brazil. In all these markets, we're seeing high adoption levels of this advanced service. During the last soccer World Cup, we acquired many new subscribers for our DVR service across these markets.

BNamericas: DTVLA saw significant growth in new subscribers during the World Cup. Did you experience high levels of churn once this event ended?

Mesquita: No. We were prepared to see significant churn, but our new subscribers continued in the base. The churn we've experienced was much lower than expected.