SBD/7/Sports Industrialists

SPORTS PLAYS A BIG ROLE IN THE GROWTH OF DIRECTV

     DirecTV is a new satellite television service available for
homes equipped with a digital satellite system.  This week, THE
SPORTS BUSINESS DAILY spoke with JIM RAMO, Exec VP for DirecTV,
about the service and where sports fits into their marketing
plans for today and the future.
     THE DAILY: What is your strategy for sports marketing?  Who
is the target demographic?
     RAMO:  We want to be the place where sports junkies go to
watch sports.  The initial target is men, who live in single
family homes, as the people who make the decision to buy the
hardware -- the initial service and satellite dish.  Those who
live in single-family dwellings are the targets because that's
the way the technology is geared.  We have four different
television ads on the air and have bought time on both cable and
network TV.  CNN and ESPN have primarily carried the ad geared
toward sports.  Other ads emphasize non-sports entertainment.
All of the ads are designed to help educate the consumer about
the technology.
     THE DAILY:  How many regional sports networks are currently
available on DirecTV?  How many will be added?
     RAMO:  All of the Liberty-affiliated regional sports
networks as well as a few independent networks.  We are currently
negotiating with all the SportsChannels.  The hope is to have all
23 regional sports networks on our service.  As of now, we have a
little more than half of all those networks.  TBS is the only
SuperStation available on DirecTV and there are no plans to add
any other SuperStations.
     THE DAILY:  Where do you see DirecTV in five years?  How can
you expand your base, bring the price down, and market to a
bigger income demographic?
     RAMO:  We hope to be in eight million hopes in five years.
Down the road, we hope to expand into multi-dwelling complexes,
i.e. condos and apartments.  Our market base will expand as the
price of the equipment comes down.  More manufacturers will soon
enter the 18-inch satellite dish market, driving the price down.
Again, we want to be the leader in specialty sports programming.
     THE DAILY:  What are your plans with league-based packages?
Are baseball or college sports coming?
     RAMO:  We currently have deals with the NFL, NBA and NHL and
are beginning talks with MLB now that the strike is over.  There
are no plans to package all of the league deals together.  The
NFL deal did not start until last November, in the middle of
their season, the NBA package did not start until January and the
NHL package did not start until after the lockout.  So we have
not had a full year to market these packages.  We will be able to
fully grasp the marketing potential of these packages next fall
as we start full seasons in all of those sports.  As for college
sports, we worked with ESPN on distributing their pay-per-view
college football package and I think we may have been their best
distributor.  Also, ESPN is working on a college basketball pay-
per-view deal and when that happens, it will likely be available
on DirecTV.  As of now, there is no college sports package, but
the regular sports service which includes all regional sports
networks, minus the NBA & NHL, allows the consumer to get a full
plate of the college sports available on those stations, there
are no college blackout rules.
          THE DAILY:  What blackout rules pertain to DirecTV?
     RAMO:  For the NFL, it is the same for us as it is for
anybody else. If your local game is blacked-out for the local
viewing area then we cannot bring that game into your home, but
we can bring all of the other games into your home.  As for any
regional blackout rules, any game that is being broadcast for the
package the consumer has ordered can be brought into your home.
The only way an NBA or NHL game is blacked-out is if the
station/network that owns the rights to that game decides not to
telecast it -- then DirecTV cannot bring it into your home.
     THE DAILY: What regional sports network advertising will a
DirecTV subscriber be exposed to?
     RAMO:  If a viewer is watching a game on another area's
regional sports network, they will be exposed to the national TV
ads, but local ads that are sold by the local cable system are
not aired on the DirecTV package.  To fill that time, we make
programming or service announcements.  There are no plans as of
yet to sell time for advertising, as the subscription base is too
small to think about selling ads.  Our service does not interfere
with ad programming of the regional sports networks.
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