TV Everywhere

DirecTV To Expand RSN Surcharge in Spring

White: $3 Charge “Doesn’t Come Close” to Offsetting Costs 2/14/2013 10:35 AM Eastern

DirecTV will expand its regional sports network surcharge in the spring to include existing customers chairman and CEO Mike White told analysts Thursday.

DirecTV began implementing a $3 monthly surcharge in August for regional sports networks in markets that had multiple RSNs,  but only to new customers. That surcharge, mainly in markets like New York and Los Angeles, will expand to existing customers in those areas in the spring, White told analysts on a conference call to discuss fourth quarter results.

Other distributors have followed DirecTV’s lead with the RSN charge – Verizon’s FiOS TV began implementing a $2.42 monthly charge for RSNs in California, Texas and Florida in February, with plans to expand to its remaining sates in March. In Maryland and Virginia, the surcharge will take effect in April.

Analysts have expected other distributors to follow suit to help offset the high costs of RSNs, but so far no cable operators have taken the bait.

White has been a vocal opponent of rising programming costs, and on the conference call, said the surcharge doesn’t come close to covering its RSN costs.

“I think it’s a judgment you have to make based on responsible churn,” White said. “We’ve made choices not to carry certain sports unless we can carry them ala carte.”

DirecTV has balked at carrying the Pac-12 regional sports networks and CSN Houston, and still does not carry CSN Northwest. The DBS leader was also one of the last distributors to sign on to Time Warner Cable Sportsnet and Time Warner Cable Deportes in Los Angeles.

DirecTV reported a strong fourth quarter, adding 103,000 net new customers in the U.S., slightly ahead of analysts’ consensus estimates of 96,000 additions. On the conference call, White said the company will increase its efforts in retaining and attracting new customers, enhancing its DirecTV Everywhere authentication service, focusing on upgrading its most loyal customers to more advanced services, and by continuing to roll out its Genie whole-home DVR service across the country.

September