GO
Loading...

Rising Costs May Price Viewers Out of DirecTV: CEO

Thursday, 26 May 2011 | 3:22 PM ET

DirecTV is facing higher content costs and intense price competition for viewers, Chief Executive Michael White told CNBC Thursday, and at some point he will have to pass along those costs to his customers, already stretched in the current economy.

Tuning into DirecTV
A look at the media company's strong performance and its strategy going forward, with Michael White, DirecTV chairman/CEO.

"The bigger problem for consumers in this economy is the rising content costs are at a rate that I don’t think the average American household can handle, he said. "Our content costs are growing high-single-digits, double-digits. I can’t price at those levels."

With both broadcasting networks and cable companies charging more for what DirecTV broadcasts over its satellite, at some point "the consumer has to pay," White said. "There’s no free lunch. At some point all of this comes back to the consumer’s budget."

DirecTV is hoping its programming and service will keep satellite customers from switching to cable or broadband service.

As for competiting satellite company Dish Network , White would not comment on whether there would be another attempt to merge the two companies.

However, he noted that the "last time this came up with the government it was unanimously rejected and that was with a Republican administration," he said. "It’s a pretty tough hill to climb."

Follow Strategy Session on Twitter: @CNBCStrategy


Watch CNBC's "The Strategy Session" weekdays at Noon ET.

  Price   Change %Change
DISH
---
DTV
---