360AM: DirecTV's 2Q Slips

Cable360AM — News briefing for Thursday, August 9 »

DirecTV reported 2nd quarter earnings, which fell 2% with net income dropping to $448 million from $459 million a year ago due to a 22% increase in operating costs. Overall revenues were up 17% (to over $4.1 billion) and U.S. revenues increased 12% (to $3.7 billion). DirecTV added 128,000 net new subs in the quarter, when average monthly revenue per subscriber increased 6.8% to $76.43 as a result of customer demand for HD and DVRs — which may explain why DirecTV also reported lower monthly churn of 1.4% in the quarter. President and CEO Chase Carey also extended his employment contract to Dec. 31, 2010. Liberty Media‘s acquisition of News Corp.’s stake in DirecTV is expected to close this quarter. Update: The U.S. Court of Appeals for the Second Circuit this morning upheld part of a lower court decision in February blocking two DirecTV ads (featuring William Shatner and Jessica Simpson) claiming superior HD picture quality from running in markets operated by Time Warner Cable, which filed the suit. However, the three-judge panel ruled that U.S. District Judge Laura Taylor Swain erred in blocking certain Web ads attacking cable’s picture quality (including a banner ad featuring Eli Manning and blurry cable TV image), which the judges said were so exaggerated that consumers wouldn’t be "fooled." Reuters and the Wall Street Journal have more.

Blockbuster acquired Movielink—and its deals with studios—to bolster the beleaguered video retail chain’s movie download business and compete with Netflix, Wal-Mart and Amazon. Terms were not disclosed. Blockbuster kicked the tires on Movielink in February but backed off. Blockbuster CEO James Keyes tells AP the deal is "a first step" toward offering movies on PCs, TV and cellphones. Meanwhile, Netflix’s movie download service has just been hacked, reports Wired.

Verizon‘s FiOS TV service is making a dent in New England, where a new report from OneTrak finds that Comcast lost an average of 2.6% of its subscribers and between 8-9% in some of the 34 FiOS markets in Massachusetts. RCN took a heavier hit, losing about 7.5% of its subs to FiOS. Report author (and veteran cable trade reporter) Matt Stump estimates about 40% of news FiOS subs came from DBS. He quotes cable analyst/New Englander Bruce Leichtman, who echoes Cablevision COO Tom Rutledge’s comments yesterday by noting that Verizon passes only 10% of the market "yet they are marketing like mad." It’s too early to read the tea-leaves on Verizon’s tactics, he cautions: "We have to be very careful in extrapolating results in an individual market as it might portend for the future." Stump discusses the findings (with former trade colleague Karen Brown) here.

The joint venture Web video portal owned by NBC Universal and News Corp. received $100 million in backing from Providence Equity Partners, which acquired a 10% stake, reports the New York Times. NBCU and Fox’s NewSite/NewCo/NameTBD site will launch next month with paid movie downloads and free TV series from NBCU and News Corp.’s respective stables of networks.

The Association of Public Television Stations (APTS), PBS and the American Cable Association signed a 10-year carriage deal that includes digital and HD programming. The deal covers ACA’s 8 million subscribers and includes DTV carriage before and after the Feb. 2009 DTV cut-off. More in the press release (PDF) and today’s Hollywood Reporter.

USA Today looks at the battle for political ad dollars on broadcast and cable TV. At stake: "at least $2 billion that candidates and issue groups are expected to spend on the tube in the first presidential election year since 1928 without an incumbent president or vice president in the race."

Comcast tapped Arc Worldwide, a division of Publicis, to help with in-store and local marketing. Arc worked on United‘s Ted launch in Chicago, which Comcast promoted in targeted local ads with Visible World.

HBO will use Motorola‘s MPEG-4 technology for its upcoming launch of 26 HD channels (in addition to last week’s $5 million HD deal with Thomson); and the NFL tapped Harris Corp. for HD instant replays starting with this week’s roster of pre-season games.

RCN announced 2nd quarter earnings and a deal with deltathree to expand its VoIP phone service.

The New York Times‘ Bill Carter highlights cable networks’ breakout summer for original programming, citing The Closer and Saving Grace on TNT; Army Wives on Lifetime; Burn Notice on USA; Damages on FX; and Mad Men on "the most unlikely channel," AMC. MIA this summer, notes Carter: HBO, which set the standard for these other networks’ original efforts. Variety also looks at cable’s summer originals. USA just ordered 13 more episodes of Burn Notice while TNT renewed Saving Grace for a 15-episode 2nd season.

BBC America will premiere Top Gear, the classic auto buffs’ series from the UK, on Aug. 20.

CNN premieres Growing Up Diana, a doc pegged to her death 10 years ago, on Aug. 21.

Comcast launched Sony Entertainment Television (SET) Asia, a package of South Asian programming, to its customers in Central and Northern California.

Court TV‘s premiere of Bounty Girls Miami tonight called "enlightening, specious and rabid" by the New York Times.

E! announced a fall reality series with Hollywood celeb socialite Kim Kardashian, replacing its just cancelled Simple Life with Paris Hilton and Nicole Ritchie (and a planned celeb spawn series with Kelly Osbourne and Kim Stewart).

Fox Soccer Channel introduces a pair of shows this weekend featuring its exclusive coverage of Barclay’s Premiere League soccer from the U.K.

LMN: Lifetime Movie Network touted its showing in the latest Beta Research cable subscriber study.

MavTV launched on Cablevision‘s iO Sports Pak. MavTV launches an HD channel in the 1st quarter and is also available on Charter Communications, Grande Communications and OEN’s Fision TV in Houston and GCI in Alaska.

Outdoor Channel posted 19.2% higher ad revenue in the 2nd quarter and has increased its VOD hours from 15 to 25, including HD programming for VOD.

Scripps Networks acquired Incando, a user-generated content-sharing service (and its second Web acquisition in less than a month.) Incando’s Pickle.com will be integrated into Scripps’ lifestyle brands.

TLC averaged 2.9 million viewers for Tuesday’s premiere of L.A. Ink, its Miami Ink spinoff — the network’s highest series premiere since What Not to Wear debuted in Jan. 2003.

Comcast is promoting next month’s release of Halo 3 (the biggest pre-order video game launch ever) online (at  Ziddio.com and GameInvasion.net) and on its VOD platform, in both HD and standard-def flavors.

EchoStar‘s HD DVR enables external USB storage of high-def programming on Aug. 15. [TVPredictions]

FCC chairman Kevin Martin said Tuesday he’s still interested in devices that would beam high-speed Internet service over "white spaces" on television airwaves, despite nixing a prototype device from Microsoft, Google and others. [AP]

Jet Broadband received a $19 million co-investment from Intermediate Capital Group in conjuction with its acquisiton last week of Suddenlink‘s Virginia cable systems.

Turner Sports will launch a broadband channel for the American Basketball Association for its 300-game season starting Nov. 10.

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