competitive landscape report february, 2013

Competitive Landscape Report

February, 2013

2

Bar/Restaurant

Confidential and Proprietary

FEBRUARY LEAD OFFER

NATIONAL OFFER PORTFOLIO

Available Packages Best Comparison to CXP Total Channels (HD) ESPN RSN One Year Cost Contract

Lengths

Satellite

Commercial Xtra Pack (185/88) $79.99 for 12 mos; Free HD + SonicTap for 3 mos

(Promo) (video only)

6 options $19.99-259.99

CXP - Free for 5 mos (Promo); $120.99 (Std) 185 (88) 6 23 $1,000.88 0-2 years

$50/mo credit with purchase of Starter Core, ESPN add-on, and at least five additional

add-ons (Std) (video only)N/A

Starter + Entertainment, ESPN, Learning, News, Sports A & B,

Variety A, B, & C Add-ons -$126/mo (Promo); $176/mo (Std)

175 (56) 5 0 $1,512.00 1+ years

CableBasic Cable (LA) (55/8) - $56.95 (Std)

(video only) ~ 4 options $47.60-87.80 Bars and Restaurants TV - $87.80/mo (Std) 72 (35) 8 1 $1,053.60 1-3 years

Sports & Entertainment Deluxe (150+/52) - $109.95/month (Promo) (video only)

5 options $29.95-189.95

Digital Deluxe - $109.95/mo (Std) 150 (52) 4 1 $1,518.40 1-3 years

TV Select (DC) (130/42) - $39.99 for 24 months + 50% off installation if ordered

online or Free installation with 3-yr contract (Promo) (video only)

~ 3 options $24.50-71.40 Advanced TV - $74.29 (Std) 174 (61) 4 3 $941.48 1+ years

Optimum Entertainment (232/82) - $59.90 for 12 months (Promo) (video only)

1 option $94.95

Optimum Entertainment - $59.90 for 12 mos (Promo); $94.95 (Std) 232 (82) 4 5 $765.75 1+ years

10% off any package with double or triple play bundle (Promo) (2 or 3 play)

2 options $42-78

Expanded TV - $72.00 for 6 mos as part of 3 play (Promo); $80 (Std)

109-153(29-56) 2 2 $961.50 1+ years

Business Digital TV (150/54) - 10% off when bundled with voice (Promo) (2 play) 1 option $104.99 Business Digital TV – $94.49 with

voice (Promo); $104.99/mo (Std) 150 (54) UNK UNK $1,280.88 0+ years

Fiber

Basic TV (25/0) - $5/month off for 24 months with triple play bundle Free Activation

(Promo) (3 play)32 options $19.99-149.99 Extreme HD - $74.99/mo (Std) 265 (65) 8 10 $1,049.86 0-2 years

Service not available for Bar/Rest, Bus/Pri View Only! Service not available for Bar/Rest, Bus/Pri View Only!

3

The Competitive Landscape:CXP vs. The Most Comparable Currently Advertised

$50.00 $60.00 $70.00 $80.00 $90.00 $100.00 $110.00 $120.00 $130.00 $140.00 $150.00 $160.00 50

75

100

125

150

175

200

225

250

275

300

325

Dish Time Warner Cable Cox Comcast Cablevision Charter

Bright House Verizon FiOS DIRECTV

Monthly Price Over 1st Year

Chan

nel C

ount

AT&T U-Verse service not available for Bar/Rest

4

2-Year Cost Comparison

Costs include all costs associated with a new customer contract with a package comparable to Commercial XTRA Pack (EVO 1-100)Confidential and Proprietary

DIRECTV DISH Time Warner Cable

Comcast Cox Cablevision Charter Bright House Verizon FiOS

$3,596.76

$3,960.00

$3,603.60

$2,837.80

$3,517.82

$2,943.63

$3,646.20 $3,721.76

$4,729.01

Bar/Restaurant (Public): 2 HD Receivers + 2 mirrors = 4 Screens Total

2-Year Total Cost of Ownership

Comcast has a compelling TV offer for 4 outlets or less

5




Comcast Cox Cablevision Charter Bright House Verizon FiOS

$4,316.76

$4,968.00

$3,771.00

$5,201.80

$3,628.82

$3,063.03

$3,957.00

$4,777.76

$5,448.65

Sports Bar (Public): 4 HD Receivers + 4 mirrors = 8 Screens Total


No longer qualifies for $109.95 offer

6

Business/Private


FEBRUARY LEAD OFFER

NATIONAL OFFER PORTFOLIO

Available Packages Best Comparison to Business Information

Total Channels (HD)

Included Outlets/ Additional Outlet

FeesOne Year Cost Contract

Lengths

Satellite

Business Information (45/12) - $29.99 for 12 months; Free HD + SonicTap for 3 mos

(Promo) (video only)

8 options$19.99-89.99

Business Information - $29.99 for 12 months (Promo); $42.99 (Std) 45 (12) 4 SD or 2

HD/$6.00 $468.88 0-2 years

$30/mo credit with purchase of Starter Core and at least six additional add-ons (Std)

(video only)N/A Starter Core Package + News+ Variety

B add-ons –$48/mo (Std ) 60 (10) 1/UNK $528.00 1+ years

Cable

TV Starter (PHX) (50/13) – $10/mo for 12 months with 1-year contract (Promo) (3 play)

~ 3 options $24.50-71.40

TV Select - $39.99 for 24 months + 50% off installation (Promo); $63.29

(Std)130 (42) 1/$10.00 $629.39 1+ years

Basic TV (35/0) - $20 off with triple play bundle (Promo)(3 play)

4 options$24.95-89.95

Info & Entertainment - $29.95 for 3 mos with 3 play (Promo); $44.95 (Std) 50 (15) 1/$9.25 $693.40 1-3 years

Basic Video (55/8) - $39.95 (Std)(Video only)

~ 4 options$39.95-99.70 Basic Video – $39.95 (Std) 55 (8) 1/$14.00 $625.39 1-3 years

10% off any package with double or triple play bundle (Promo)(2 or 3 play)

2 options $42-78

Basic TV Bus/Pri - $33.29 for 6 mos as part of bundle (Promo); $36.99 (Std)

43(11) 1/$10.95 $520.68 1+ years

Broadcast Basic (35/10) - $29.95 for length of contract (Std)(video only)

2 options$29.95-58.95 Broadcast Basic - $29.95/mo (Std) 35 (10) 0/$9.95 $406.35 1+ years

Business Digital TV (150/54) - 10% off when bundled with voice (Promo) (2 play)

1 option$104.99

Business Digital TV – $94.49 with voice (Promo); $104.99/mo (Std) 150 (54) 3/$4.99 $1,280.88 0+ years

Fiber

BV Basic (36/17) - $20/month (Std); Video service only, must be bundled with Internet

(2 play)

3 options$40-85 U-Verse Basic TV - $20/mo (Std) 36 (17) 1/$12.95 $240.00 0+ years

Basic TV (25/0) - $5/month off for 24 months with triple play bundle Free Activation (Promo)

(3 play)

4 options$19.99-89.99 Local - $19.99/mo (Std) 25 (0) 3/$19.99 $389.86 0-2 years

7




Comcast Cox Cablevision Charter Bright House Verizon FiOS AT&T U-Verse

$1,341.76 $1,152.00

$2,250.79

$1,960.60

$2,212.75

$1,881.99

$2,280.36

$3,241.76

$1,209.26 $1,224.00

Business/Private: 2 SD Receivers; 2 Screens Total


8

Quarter SnapshotDecember, 2012 – February, 2013


THIS QUARTER IN REVIEW The end of 2012 saw little change on the small business video

front, however in January your competitors began to make adjustments to their product offerings.

DISH and Charter raised the standard pricing across their video offer portfolio, most likely in response to the raising programming costs viewed in 2012.

Comcast, TWC, and Comcast all stayed mostly the same from last quarter, but we did see all three weaken their offers by removing promotions that had been extended previously (Comcast, Cox) or decreasing the promotional values (TWC).

AT&T added functionality to their website that allows for customers to view U-Verse TV offers which will provide us with greater access to information moving forward. Also greater access for their customers.

At times this quarter, FiOS weakened their triple play offer by reducing the cash back promotional value from $200 to $100.

As you continue, this report will show that despite these changes, DIRECTV can still attack these offers to win and retain customers.

9

DIRECTVFebruary, 2013


10Source: DTV Sales Guide 2/6/13; Website: 2/19/13

DIRECTV’s Bar & Restaurant Snapshot


Premium

DIRECTV

Entry

Bar/R

est

Video Packages Features Contract

Name Promotional Price/ Standard Price Total Channels (HD)

# of Most Popular Customer Requested Channels*

ESPN RSN Additional Promotion Term

Commercial BasicNo Promo

30 (2) 0 0 0 Up to two free SD receivers 24 Months

$19.99

Business Information

$29.99 for 12 mos w/ ABP 45 (12) 9 0 0

Free for 3 Months: HD Access and

Sonictap24 Months

$42.99

Commercial Choice (EVO 1-50)

$44.99for 12 mos w/ ABP 125 (48) 23 0 0

Free for 3 Months: HD Access and

Sonictap24 Months

$58.99

Commercial Entertainment Pack

(EVO 1-100)

$59.99 for 12 mos w/ ABP 96 (44) 23 ESPN, ESPN2,

ESPN3D 0Free for 3 Months:

HD Access and Sonictap

24 Months$84.99

Comercial Mas Ultra$59.99 for 12 mos w/

ABP 129 (38) 22ESPN, ESPN2, ESPN

Classic, ESPN Deportes, ESPNews

0Free for 3 Months:


24 Months

$92.99

Commercial Xtra Pack

$79.99 for 12 mos w/ ABP 184 (88) 31

ESPN, ESPN2, ESPN3D, ESPN

Classic, ESPNews, ESPNU

26 Free for 3 Mos HD and Sonictap 24 Months

$120.99

Commercial Choice Plus (EVO 101-150)

$189.99 for 12 mos w/ ABP 138 (53) 27



0Free for 3 Months:


24 Months

$259.99

DTV Insights:• Customers must have a two year contract and sign-up for ABP to get best

deals.*A count of the number of most requested channels as defined by DTV customers

11

DIRECTV’s Business & Private Snapshot


Entry

DIRECTV

DTV Insights:• With no popular channels, Commercial Basic offers little value for both

SMB customers and employees.

Source: DTV Sales Guide 2/6/13; Website: 2/19/13

Premium

Bus/P

ri



# of Most Popular Customer Requested

ChannelsESPN


FeesAdditional Promotion Term

Commercial BasicNo Promo

30 (2) 0 01 Up to two free SD

receivers 24 Months$19.99 $6.00

Office Information$29.99 for 12 mos w/

ABP 47 (11) 10 01 Free for 3 Months: HD

Access and Sonictap 24 Months$42.99 $6.00

Business Information

$29.99 for 12 mos w/ ABP 45 (12) 9 0

1 Free for 3 Months: HD Access and Sonictap 24 Months

$42.99 $6.00

Office Entertainment$44.99 for 12 mos w/

ABP 58 (32) 16 01 Free for 3 Months: HD

Access and Sonictap 24 Months$66.99 $6.00

Business Entertainment

$44.99 for 12 mos w/ ABP 56 (30) 14 0


$66.99 $6.00

Comercial Mas Ultra$49.99 for 12 mos w/


Classic, ESPN Deportes, ESPNews


$62.99 $6.00

Office Choice$54.99 for 12 mos w/




$89.99 $6.00

Business Choice$54.99 for 12 mos w/

ABP 174 (85) 30




$89.99 $6.00

12

DISHFebruary, 2013


13

Dish’s Bar & Restaurant Snapshot


Premium

Source: Provider website. 2/19/13

Entry

Bar/R

est



# of Most Popular Customer

Requested ChannelsESPN RSN Additional

Promotion Term

Starter + News Add-On No Promo54 (4) 4 0 0 NA 24 Months

$34.00

Starter + Latino Popular and Latino Elite Add-

ons(Similar to Comercial

Mas Ultra)

No Promo 85 (3)Includes 41 Spanish language channels

3 ESPN Deportes 0 NA 24 Months

$48.00

Starter + Entertainment, Learning, News, Sports A & B, Variety A, B, & C

Add-ons(Similar to Commercial

Choice)

$116.00170 (56) 20 0 0 NA 24 Months

$126.00

Starter + Entertainment, ESPN, Learning, News, Sports A & B, Variety A,

B, & C Add-ons(Similar to Commercial

Choice Plus)

$126.00175 (56) 24

ESPN, ESPN2, ESPN Classic, ESPNews,

ESPNU0 NA 24 Months

$176.00

Starter + Learning + News+ Variety B +

ESPN + RSN add-ons(Similar to Commercial

Xtra Pack)

302.00140 (49) 24


ESPNU25 NA 24 Months

$352.00

DISH Insights:• Pricing model works best for customers with specific needs. However, there

is an additional $10/mo discount for customers who purchase 3+ add-on packages.

• ESPN channels can be added to any package for $50/mo• Customers can receive a $50/mo discount by buying the Starter Pack,

ESPN, and any 5 add-on packages.• Sports add-ons are comprehensive but expensive.

Bar/R

est

DISH

14

Dish’s Business & Private Snapshot


Entry

DISH Insights:• Dish gets customers in the door with low sticker prices but then will try to up sell

customers to more add-ons.• Customers can get exactly what they want, without a lot of extras.• The cost of additional add-ons add up quickly.• Customers can receive a $30/mo discount by buying the Starter Pack and

any 6 add-ons.Source: Provider website. 2/19/13

Premium

Bus/P

ri




ChannelsESPN



Starter + News Add-OnNo Promo

54 (4) 4 01

NA 24 MonthsUnknown$34.00

Starter + Latino Popular and Latino Elite Add-ons

No Promo 85 (3)Includes 41 Spanish language channels

3 ESPN Deportes (Included in Latino Elite)

1NA 24 Months

$48.00 Unknown

Starter + News, Variety A, Variety B Add-ons

(Similar to Business/Office

Information)

$50.0081 (16) 8 0

1NA 24 Months

$60.00 Unknown

Starter + Entertainment, Learning, Lifestyle, and

Variety A Add-ons(Similar to

Business/Office Entertainment)

$64.00

130 (37) 10 0

1

NA 24 Months

$74.00 Unknown

Starter + Entertainment, ESPN, Kids, Learning, Lifestyle, News, Sports

A, Variety A, B, & C Add-ons

(Similar to Business/Office Choice)

$130.00

200 (62) 30ESPN, ESPN2, ESPN


1

NA 24 Months

$160.00 Unknown

DISH

15

DISHDecember, 2012 – February, 2013


Changes This Quarter

Dish increased the rate of their standard core package and the rates on the following video add-ons during January: Learning, Lifestyle, Latino Popular, Sports A, Variety B, Variety C, ESPN, Fox Soccer, and Fox Soccer Plus.

Of these packages ESPN ($5/mo) and the sports packages Fox Soccer and Fox Soccer Plus saw the greatest increases. The other packages increased by $2/mo

How to Compete

In February 2011, Dish CEO Joseph Clayton committed to not raising prices until January 2013. Rates have likely increased now due to higher programming costs, but with most add-ons only increasing by $2/mo, Dish’s strategy of getting customers in with a low price and then up selling them to higher priced services (i.e. more and more expensive add-on packages)

The cost of additional add-ons add up. DISH provides a great value to customers looking for just one or two add-ons. After that, customized plans can get expensive, even with discounts up to $30/month for Bus/Pri and $50/month for Bar/Rest.

To match CXP in just sports programming, a DISH customer would need to spend over $300/month in add-ons!

DISH seems to follow a “bottom-up” approach by encouraging customers to buy only as much add-ons as needed. Their marketing is aimed at the small customers not at the number of channels and sports they offer.

However, for customers looking for 3 or more add-ons, in most cases DIRECTV has an offer that has more channels at a better price. In fact, the promotional rates of all of DIRECTV’s Bus/Pri offers (except Choice) are lower than the customized Dish package.

16

COMCASTFebruary, 2013


17

Comcast’s Bar & Restaurant Snapshot


Premium

COMCAST

Comcast Insights:• Pricing is by flat rate, not by seating occupancy, EVO, or FCO. Comcast

really starts to tip the balance in their favor on seating occupancies 200+.• Sports and Entertainment Deluxe is Comcast’s ultimate package for large

Bar/Rest however promotional pricing is only available to customers with up to 4 outlets.


Entry

Bar/R

est





Promotion Term

BasicNo Promo

35 (2) 0 0 040% off every

additional outlet over the first 8

12 Months

$29.95

Digital Basic PlusNo Promo

50 (15) 8 0 040% off every


12 Months

$54.95

Digital StandardNo Promo

80 (22) 20 ESPN, ESPN2 Local RSN40% off every


12 Months

$84.95

Digital DeluxeNo Promo

150 (52) 28 ESPN, ESPN2, ESPNews, ESPNU Local RSN

40% off every additional outlet over

the first 812 Months

$109.95

Sports and Entertainment

Deluxe

$109.95150+ (52) 29


ESPNULocal RSN



$189.95

18

Comcast’s Business & Private Snapshot


Entry

COMCAST

Comcast Insights:• Comcast’s Information and Entertainment package provides little value

with only 5 Popular channels and a $44.95 price point; compare to Business/Office Information that has twice the popular channels.

• Comcast incentivizes customers to accept two and three year contracts by providing discounts on installation.


Premium

Bus/P

ri




ChannelsESPN



Basic

$4.95 for 3 mos when bundled

35 (0) 0 00 40% off every


12 Months

$24.95 $9.25

Information and Entertainment


50 (15) 5 01 40% off every


12 Months

$44.95 $9.25

Standard


80 (22) 20 0

140% off every


12 Months

$74.95 $9.25

Preferred


150 (52) 23ESPN, ESPN2,

ESPNews, ESPN Classic

1



$89.95 $9.25

19

COMCAST December, 2012 – February, 2013


Changes This Quarter Comcast has continued to extend their Sports & Entertainment Deluxe

for $109.95/mo with 2-year agreement (standard $189.95) promotion to the end of the respective month.

Comcast has removed their promotion offering $10/mo off when ordered online.

How to Compete

By removing their $10/off promotion, the only discount Comcast offers for Bar/Rest is on their most expensive package: $109.95/mo for Sports & Entertainment Deluxe.

Comcast’s offer of Sports & Entertainment Deluxe for $109.95/mo is a great deal that beats the standard price of DIRECTV’s Commercial Xtra Pack.

Only available to customers with up to 4 outlets, limiting its effectiveness (Bar/Rest)

By practically giving away its Basic TV service (just $4.95/mo) when bundled, Comcast hopes that they can convince customers to upgrade to a more expensive service after the 3 month promotional period.

DIRECTV’s 12-month promotions provide a better deal than Comcast’s 3-month discounts across the board over a one year period.

Comcast’s Digital Standard and Digital Deluxe weakness is their sports programming as CXP and Commercial Choice Plus both offer more ESPN and RSN channels. Customers can upgrade sports offerings for $34.95/mo (a 41% and 32% price increase respectively), but at that rate DIRECTV’s CXP is a better value. (Bar/Rest)

20

COX COMMUNICATIONSFebruary, 2013


Unlike most companies in the SMB commercial space that generally keep their pricing and plans consistent across their footprint, Cox operates on a regional structure. Across these regions Cox may offer different plans, pricing, and/or promotions.

In the following tables for Cox, the median price across all markets is used, except in cases where a specific market’s price/promotion is called out, and all channel counts are shown as a range across all markets.

21

Cox’s Bar & Restaurant Snapshot


Premium

COX

Cox Insights:• Advanced TV is the only offer customers can purchase add-on services such as a movie,

variety, or sports add-ons.• Free HD programming across all markets and offers compared to 3 months Free HD with

DTV.


Entry

Bar/R

est





Promotion Term

Starter

PHX - $10 for 12 mos when used to

complete a triple play27-70 (0-22) 0 0 0

Free HD (All), Free installation when

bundled with Internet and voice (PHX)

12 Months

$24.50

Select

DC - $39.99 for 24 mos

CLE - $40 for 24 mos80-143 (0-57) 21 ESPN, ESPN2 2

Free HD (All), 50% off Installation when

ordered online (DC)24 Months

$60.50

Advanced

No Promo

151-201 (56-83) 21

ESPN, ESPN2 (ESPNU and ESPN

Classic w/Sports and Info Pak)

2 Free HD (All) 24 Months

$74.02

22

Cox’s Business & Private Snapshot


Entry

COX

Cox Insights:• High channel counts at relatively low prices.• Starter is an even worse value than Commercial Basic outside of PHX• No offer to compete with Business/Office Information.


Premium

Bus/P

ri




ChannelsESPN



Starter

PHX - $10 for 12 mos when used to

complete a triple play27-70 (0-22) 0 0

1 Free HD (All), Free installation when

bundled with Internet and voice (PHX)

12 Months

$24.50 $10.00

Select

DC - $39.99 for 24 mos

CLE - $40 for 24 mos80-143 (0-57) 21 ESPN, ESPN2

1Free HD (All) 50% off

Installation when ordered online (DC)

24 Months

$60.50 $10.00

Advanced

No Pomo

151-201 (56-83) 21

ESPN, ESPN2 (ESPNU and ESPN

Classic w/Sports and Info Pak)

1

Free HD (All) 24 Months

$74.02 $10.00

23

COX COMMUNICATIONS December, 2012 – February, 2013



On 01/01/2013 Cox’s latest promotions expired. As a result the following promotions were either added or extended:

Cleveland (Added) – TV Select is available for $40/mo for 24 months w/ 2 year agreement (standard price is $55.95)

D.C. (Extended) – Receive 50% off installation when TV Select is ordered online with a two year agreement or free installation with a three year agreement.

Phoenix (Extended) – TV Starter is available for $10/mo for 12 months plus free installation when added to Cox Internet and voice (standard price is $25.95/mo). Requires a minimum 1-year contract.

D.C. (Extended) – TV Select is available for $39.99/mo plus get one month free with a 2-year contract (standard price is $63.29).

The above promotions all show an expiration date of 04/01/2013

D.C. – Cox previously included their Sports & Info Pak ($5.25/mo) with Advanced TV, this has now been removed.

How to Compete

For the first time since year, Cox is not offering an Advanced TV promotion in at least one of their markets. With the promotion Cox was a clear price leader for that offer level but that advantage is now gone.

Cox is showing new interest in their TV Select Plan. At the $40/mo promotional price TV Select is an attractive offer especially for Bus/Pri. DTV’s advantage is in the customers ability to configure their plan through add-ons, Cox only allows this type of configuration with their Advanced TV offer.

Cox’s biggest weakness is their below average ESPN, RSN, and alternative sports programming (Speed, Outdoor Channel, league specific channels, etc…) included in their offers.

Cox includes free HD access on all their plans, and there is currently no difference between their private and public offers.

24

TIME WARNER CABLEFebruary, 2013


Unlike most companies in the SMB commercial space that generally keep their pricing and plans consistent across their footprint, TWC operates on a regional structure. Across these regions TWC may offer different plans, pricing, and/or promotions.

In the following tables for TWC, the median price across all markets is used, except in cases where a specific market’s price/promotion is called out, and all channel counts are shown as a range across all markets.

25

TWC’s Bar & Restaurant Snapshot


TWC Insights:• TWC attracts customers by including 8 ESPN channels and with

a reasonable price.• Low overall channel count based on price• 10% and 20% discounts for customers who select 2 or 3-year

contracts respectively.Source: Provider website. 2/19/13





Promotion Term

BasicNo Promo

55-75 (8-14) Unknown Unknown Unknown NA 36 Months$47.60

StandardNo Promo

110-167 (50-60) Unknown Unknown Unknown NA 36 Months67.60

DigitalNo Promo

225-314 (65-86) Unknown Unknown Unknown NA 36 Months85.30

Bars and Restaurants TV

No Promo

72 (35) 16


ESPNU, ESPN Deportes, ESPN Goal Line, ESPN

Buzzer Beater

Local RSN(s) NA 36 Months

$87.80

TWC

26

TWC’s Business & Private Snapshot


Entry

TWC

TWC Insights:• TWC has segmented its offers to cater towards specific customers.• At least one ESPN channel is included with every package.• 10% and 20% discounts for customers who select 2 or 3-year contracts

respectively.Source: Provider website. 2/19/13

Premium

Bus/P

ri




ChannelsESPN



Digital News TierNo Promo

29 (11) 8 ESPNews

1NA 36 Months

$40.80 $14.00

Business AdvantageNo Promo

34 (16) 10 ESPNews

1NA 36 Months

$48.30 $14.00

Healthcare TVNo Promo

68 (32) 18 ESPN, ESPN2, ESPNews

1NA 36 Months

$73.30 $14.00

Prime Cable TVNo Promo

86 (43) 19 ESPN, ESPN2, ESPNews

1NA 36 Months

$73.30 $14.00

27

TIME WARNER CABLE December, 2012 – February, 2013


Changes This Quarter TWC increased the promotional rate on their running triple and double

play promotions:

Triple Play Promotion (was $99.99): NY: 7 Mbps Internet, Unlimited Tri-state calling, and Digital News

Tier TV for $109.98/mo with 1-yr contract.

Double Play Promotion (was $99.95 for both services): Cleveland, Dallas, and LA: 10 Mbps Internet for $99.95/mo +

Business Class phone for $29.95/mo when bundled with 3-yr contract.

NY (Added Since Last Quarter): $39.99 per service per month for 7 Mbps Internet + Unlimited phone with 1-yr contract.

How to Compete

With TWC focused on voice and Internet, DIRECTV customers have the opportunity to combine DTV service with TWC double plays for a comparable price and more channels than a traditional TWC triple play (see chart).

For businesses with multiple TVs, DIRECTV’s price advantage on outlet fees adds up to big savings for the customer (a savings of $8/outlet/month). E.g. a business with three TVs would be saving ~ $288/year just on outlet fees by switching to DTV.

TWC Bars and Restaurants TV offers a very compelling option to bars and restaurants not looking for sports add-ons like NFL Sunday Ticket. However, CXP’s promotional price is still less expensive over the first year. CXP also offers more RSNs and “popular” channels.

Comparing DIRECTV to TWC

in NY

TWC – $109.98 Triple Play

DIRECTV – Business

Information + TWC Double Play

Internet Downstream Speed 7 Mbps 7 Mbps

Phone Tri-State Calling Tri-State Calling

Total Channels 29 45

HD Channels 11 12

Monthly Price $109.98 $109.97

28

CHARTER COMMUNICATIONSFebruary, 2013


29

Charter’s Bar & Restaurant Snapshot


Premium

CHARTER

Charter Insights:• Charter’s offers a 10% discount to customers who bundle.• Charter offers a limited sports selection (2 ESPNs, local RSNs) however,

sports programming can be increased with Sports View add-on (3 ESPNs).• Sports View add-on is available for $89/mo.

Source: Provider website 2/19/13

Entry

Bar/R

est





Promotion Term

Basic

$39.60 for 6 mos w/ bundle

37-74 (8-15) 0 0 0Save 50% on

installation when bundled

12 Months

$44.00

Expanded


109-153 (29-56) 20ESPN, ESPN2 (ESPN

Classic, ESPNews, ESPNU available w/ Sports View add-on)

2Save 50% on


12 Months

$80.00

30

Charter’s Business & Private Snapshot


Entry

CHARTER

Charter Insights:• Expanded TV offers a large number of “popular” channels at a low monthly charge; however

Basic TV offers little value despite relatively high channel counts.• Charter is strongly focused on their phone & Internet double play and offer discounts to

customers who bundle with TV.• Sports View add-on is available for $89/mo.


Premium

Bus/P

ri




ChannelsESPN



Basic


37-74 (8-15) 0 0

1Save 50% on


12 Months

$36.99 $10.95

Expanded


109-153 (29-56) 20ESPN, ESPN2 (ESPN

Classic, ESPNews, ESPNU available w/ Sports View add-on)

1Save 50% on


12 Months

$59.99 $10.95

31

CHARTER December, 2012 – February, 2013



Charter has simplified their online shopping cart and have removed the option to select between basic and expanded TV, however both options are confirmed to still be available.

Mystery shopping has revealed that Charter has increased all offer pricing by $2/mo as follows:

Private – Basic TV: $36.99/mo from $34.99/mo Private – Expanded TV: $59.99/mo from $57.99/mo Public – Basic TV: $44/mo from $42/mo Public – Expanded TV: $78/mo from $80/mo

How to Compete

Charter’s price increase on its TV packages is most likely due to rising programming costs. With this increase, the one year cost of CXP ($846.93) is now lower than Expanded TV ($866.40) while offering a lot more value. In addition, Business Choice has more “popular” channels for still about the same price (Bus/Pri).

Basic TV offers nearly no value; Business Information offers more for about the same price and Commercial Basic offers the same for nearly $30 less per month

DIRECTV has a clear advantage on equipment fees. Consider a customer that needs 4 HD receivers. Over the first year, with DIRECTV that customer would pay $198; with Charter, that customer would pay $778.20 just on receivers!

Charter still discounts Internet when purchased with just voice (so it can still be taken advantage of if a customer bundles Charter voice and Internet with DTV video).

32

VERIZON FIOSFebruary, 2013


33

Verizon FiOS’s Bar & Restaurant Snapshot


Premium

FiOS

FiOS Insights:• Offers EVO pricing for Bars and Restaurants.• Customers who do not bundle and/or request a no contract option are

faced with high activation and installation fees.• Extreme HD has high channel counts and market leading ESPN options.


Entry

Bar/R

est





Promotion Term

Local(Not Contingent on

EVO)

No Promo25 (0) 0 0 0

Free FiOS TV activation with any

FiOS bundle (a $99.99 value)

24 Months

$19.99

Extreme HD(EVO 1-50)

No Promo265 (65) 15

ESPN, ESPN2, ESPNU, ESPN Buzzer Beater,

ESPN Goal Line, ESPN Classic, ESPN Deportes,

ESPNews

10



24 Months

$149.99

34

Verizon FiOS’s Business & Private Snapshot


Entry

FiOS

FiOS Insights:• FiOS is currently marketing their Internet and Phone double play with a $200

Visa prepaid card.• FiOS has high set-up costs when ordered without a contract; their equipment

fees are slightly higher overall than DIRECTV’s.


Premium

Bus/P

ri




ChannelsESPN Additional

PromotionIncluded Outlets/ Additional Outlet

FeesTerm

LocalNo Promo

25 (0) 0 0



324 Months

$19.99 $19.99

Prime HDNo Promo

170 (42) 14 ESPN, ESPN2, ESPNU



324 Months

$64.99 $19.99

Extreme HD

No Promo

265 (65) 15

ESPN, ESPN2, ESPNU, ESPN Buzzer Beater,

ESPN Goal Line, ESPN Classic, ESPN Deportes,

ESPNews



3

24 Months

$74.99 $19.99

Ultimate HD

No Promo

330 (82) 15

ESPN, ESPN2, ESPNU, ESPN

Buzzer Beater, ESPN Goal Line, ESPN Classic, ESPN

Deportes, ESPNews, ESPN 3D



3

24 Months

$89.99 $19.99

35

VERIZON FiOSDecember, 2012 – February, 2013



Verizon FiOS weakened their triple play offer during last quarter by reducing the cash back promotional value from $200 to $100. Recently, FiOS increased the cash back amount back to $200, this deal expires on 3/16/2013.

How to Compete

DTV customers who add CXP to FiOS’s “Solutions Business” Internet and phone bundle come out on top compared to a VZ FiOS triple play with Extreme HD

When not bundling, FiOS customers will have to pay high installation and activation fees.

VZ charges slightly more for additional outlets and additional HD receivers. For large establishments, these costs can add up fast.

For Verizon all additional outlets, public or private, cost $19.99/mo.

competitive landscape report february, 2013

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