direc tv group The DIRECTV Group, Inc. Investor Day

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Presentation Title Slide

Speaker NameTitle (change point size to 16pt)

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Investor MeetingFebruary 28, 2008



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Jon RubinSenior Vice PresidentInvestor Relations and Financial Planning

2

Agenda

Break

Derek Chang – EVP, Content Strategy & DevelopmentContent Overview

Q&A

Chase CareyClosing Remarks

Lunch / Demos

Bruce Churchill – President, DIRECTV Latin AmericaDIRECTV Latin America

Mike Palkovic – EVP, OperationsCustomer Service Operations

Paul Guyardo – EVP, Sales & Chief Marketing OfficerSales & Marketing

Eric Shanks – EVP, DIRECTV EntertainmentDIRECTV Entertainment

Romulo Pontual – Chief Technology OfficerTechnology

Pat Doyle – Chief Financial OfficerFinancial Overview

Chase Carey – President & CEOOpening Remarks

Jon Rubin – SVP, IR & Financial PlanningWelcome

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Cautionary StatementThis presentation includes certain statements that may be considered to be, “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (“PSLRA”). These forward-looking statements generally can be identified by words such as “believe,” “expect,” “estimate,” “anticipate,” “intend,”“plan,” “foresee,” “project” or other similar words or phrases. Similarly, statements that describe our objectives, plans or goals also are forward-looking statements. All of these forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or from those expressed or implied by the relevant forward-looking statement. Such risks and uncertainties include, but are not limited to: economic conditions; product demand and market acceptance; ability to (a) improve customer service or create new and desirable programming content and interactive features; government action; political, economic and social uncertainties in many Latin American countries in which DTVLA operates; foreign currency exchange rates; competition; the outcome of legal proceedings; ability to achieve cost reductions; ability to renew programming contracts under favorable terms; technological risk; limitations on access to distribution channels reliance on satellites as a significant part of our infrastructure and we may face other risks described from time to time in periodic reports filed by us with the SEC.

Non-GAAP FinancialsThis presentation includes financial measures that are not determined in accordance with GAAP, such as Operating Profit before Depreciation and Amortization, Free Cash Flow and Cash Flow before Interest and Taxes. These financial measures should be used in conjunction with other GAAP financial measures and are not presented as an alternative measure of operating results, as determined in accordance with GAAP. DIRECTV management uses these measures to evaluate the profitability of DIRECTV U.S.’ subscriber base for the purpose of allocating resources to discretionary activities such as adding new subscribers, upgrading and retaining existing subscribers and for capital expenditures. A reconciliation of these measures to the nearest GAAP measure is posted on our website and is included at the end of this presentation package.

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Chase CareyPresident & CEO

Overview

Recap Recent Results / Trends

Overview of Key Operating Areas

3-year Outlook

6

4

Unique Position of Strength

Brand / Content / HD

Technology

Direct Sales

Improved tools / efficiencies

Key cost reductions

7

Opportunities to Improve

Service quality / efficiency

Upgrade spending

Niche / target subscriber growth

Fix / address weak pockets

Develop new revenue streams

8

5

Competitive Market

Challenged competitors

FiOS

HD leadership

VOD solution

BundleDevelop / sell optionsUse distribution strength

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6



Pat DoyleChief Financial Officer

Financial Overview

Agenda

Financial Overview

Subscriber Highlights

Key Financial and Operating Metrics

Balance Sheet

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7

Building a Foundation for Growth

Extended DIRECTV’s video leadershipHDSportsInteractivityAdvanced equipment

Exerted greater financial disciplineStricter credit policiesImproved segmentationGreater cost controls

Enhanced Sales and MarketingAttained higher-quality subscribers Strengthened brandOptimized subscriber channels and increased Direct Sales

13

The DIRECTV Group2005 - 2007 Financial Results

24.2%23.0%11.3%Operating Profit Before D&A Margin

$1.48B$1.31B$386MCash Flow Before Interest & Taxes

$953M$1.19B$283MFree Cash Flow

$2.02B$2.98B-Share Repurchases

$1.21$1.12$0.24Diluted EPS

$2.70B

$4.17B

$17.2B

2007

$1.99B

$3.39B

$14.8B

2006

$924M

$1.49B

$13.2B

2005

Capital Expenditures

Operating Profit Before D&A

Revenue

14

8

DIRECTV U.S.2005 - 2007 Financial Results

24.8%23.4%12.3%Operating Profit Before D&A Margin

$1.46B

$2.33B

$3.85B

$15.5B

16.8M

0.9M

1.51%

3.8M

2007

$1.42B

$1.81B

$3.22B

$13.7B

15.9M

0.8M

1.60%

3.8M

2006

$776M

$782M

$1.50B

$12.2B

15.1M

1.2M

1.70%

4.2M

2005

Cash Flow Before Interest & Taxes

Capital Expenditures

Operating Profit Before D & A

Revenue

Financial

Cumulative, Year-end

Net Additions

Monthly Churn %

Gross Additions

Customers

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DIRECTV U.S. Subscriber Highlights

Over-indexed in key areas including:IncomeEducation Home ownership

Geographically diverse

Broadband penetration consistent with cable

Profitably growing International segment

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9

Improving Subscriber Quality

2005 2006 2007

28%

72%

15%

85%

10%

90%

Gross Additions

Higher Risk

Lower Risk

17

Adding Higher Value Subscribers

3.021%

1.3

(0.2)0.6%

0.9

0.614%

2005

4.630%

1.6

(0.3)0.7%

0.9

1.028%

2006

6.641%

2.0

(0.6)0.8%

0.9

1.747%

2007

Net Advanced Additions

Cum Advanced Subscribers% of Cum Residential Subscribers

Advanced ChurnChurn Rate

Advanced Upgrades

Advanced Gross Additions% of Total Gross Additions

HD and/or DVR Subscriber Additions (M)

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10

Strong ARPU Growth

$69.61

5.00

8.90

$55.70

2005

$73.74

5.50

9.70

$58.50

2006

$79.05

6.60

12.20

$60.30

2007

CAGR = 6.6%Total ARPU

25% Ad Sales growth / fewer credits / Telesat /

Commercial / Protection PlanOther / Ad Sales

Advanced sub-penetration increased from 21% to 41%

Average boxes / home increased from 2.27 to 2.53

Average price increase of ~4%

Key Drivers

Advanced Services / Equipment / Lease Fees

Packages / Premiums /Sports / PPV

Monthly Subscriber Revenue (ARPU)

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0.71%

0.52%0.57%

0.99% 0.99%1.03%

1.51%1.60%1.70%

2005 2006 2007

Driving Lower Monthly Churn

Total ChurnStricter Credit Policies

Mandatory credit cards, social security numbersNew fraud management system

Longer Term CommitmentsBasic equipment: 12 18 monthsAdvanced equipment: 24 months

More Advanced Subscribers

Improved Customer Service

Voluntary

Involuntary

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11

Declining Set-Top Box Costs

430

210

180

$50

Q1 2007

260

130

150

$45

Q1 2008

$55$80Basic

520

260

245

Q1 2005

480HD-DVR

250HD

200DVR

Q1 2006

OEM Costs*

* Excludes security card, middleware and other fees

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Subscriber Acquisition Cost (SAC*)

$692

265

165

120

$140

2007

$85$55Advanced Equipment

$642

225

165

200

2005

235Dealer Commissions / Marketing

$642TOTAL

160Installation

160Basic Boxes

2006

Investing in Advanced Products and Targeting High Value Customers Results in Higher ARPU and Lower Churn

* Includes both acquisition expense and capitalized set-top box costs

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12

Major Upgrade Cycle Peaking

$1.74B$1.33B$1.10BTotal

$795M$570M$330MHD / DVR Upgrades

$370M

190M

$1.55B

235

270

250

2007

$230M

-

$1.10B

200

260

310

2005

$230MEquipment Revenues

270Movers

75MMPEG4 for MPEG2 HD Swaps

$1.25BSub-Total

200Other Marketing

210Basic Boxes / Local Upgrades

2006

Upgrade and Retention Costs*

* Includes both upgrade and retention expense and capitalized set-top box costs

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Stabilizing Programming Margins

2005 2006 2007

Programming Expense* as a % of Revenues

Older contracts /early years of newer improved contracts

Addition of many new channels, particularly sports

Fox News and NFL Network increases in 2007

End of purchase accounting treatment for Showtime contract in 2006

40.0%39.6%38.6%

Sports**

Packages/Premiums / PPV

Total

* Excludes non-programming cost of sales ** Includes a-la carte packages, RSNs and NFL Network

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7.1% 7.8% 8.1%

Recent Margin Erosion Due To:

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Other Operating Costs

Costs as a % of Revenues

1.4%

5.0%

7.3%

2007

Local-into-Local and HD build-out

Lower bad debt expense; efficiencies and cost

controls

Higher service costs related to advanced

products and new call centers offset by

efficiencies and cost controls

Key Drivers

7.7%7.7%Subscriber Services

1.2%

6.6%

2005

1.3%Broadcast Operations

5.5%General & Administrative

2006

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2005 2006 2007

HD Infrastructure Mostly Complete

Capital Expenditures ($B)

$0.8$0.7 $0.8

BasicHD and local build-out

3 satellitesGround infrastructure

Set-Top BoxesImplemented lease program

Increased advanced product penetration

Richer mix of more expensive boxes

HD Infrastructure

Sustaining

Set-top Boxes - $1.1 $1.5Total CapEx $0.8 $1.8 $2.3

Satellites

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14

Strong Balance Sheet

$2.3B net debt position as of YE 2007Cash and Cash Equiv. $1.1BTotal Debt 3.4BNet Debt $2.3B

.6x Net Debt to OPBDA

Comfortable with current credit rating

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Summary

Leading digital multichannel TV service providerUnique and exclusive programmingMost comprehensive HD programmingNew products / services expected to further differentiate

Strong revenue, OPBDA, and subscriber growthIncreasing margins due to cost controls and operating leverage

Strong balance sheet with substantial liquidity

DIRECTV is poised for profitable growth and increasing cash flow

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15



Technology Update

Rômulo PontualExecutive Vice President & Chief Technology Officer

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Technology Update and Plan

Space segment

Consumer premise equipment

Capitalize on technology leadership

Use of home network (demos)

31

Space Segment

Optimum orbital slotsReduces obstructions and effect of rainAllows single-dish solution for all customers

101°103° 99°

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Space Segment

Young satellite fleet9 DIRECTV satellites plus 7 Intelsat transponders12+ years average remaining estimated life

Two satellites under constructionD11 launches March 2008D12 backup for D10 or D11

Will launch D12Growing importance of HD warrants its use to expand national capacity Launch expected late 2009

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Space Segment

Young satellite fleet9 DIRECTV satellites plus 7 Intelsat transponders12+ years average remaining estimated life

Two satellites under constructionD11 launches March 2008D12 backup for D10 or D11

Will launch D12Growing importance of HD warrants its use to expand national capacity Launch expected late 2009

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During the last two yearsAdded 92 national channels, 74 in HDLaunched 77 HD local markets (76% USHH)Added 7 local markets in SD (94% USHH)Added 31 International channels

In 2008, will continue HD leadershipCapacity for 150 HD national channelsAt least 100 HD local markets (84% USHH)

D12 will support further expansionCapacity for more than 200 HD national channels

Channel Expansion

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During the last two yearsAdded 92 national channels, 74 in HDLaunched 77 HD local markets (76% USHH)Added 7 local markets in SD (94% USHH)Added 31 International channels

In 2008, will continue HD leadershipCapacity for 150 HD national channelsAt least 100 HD local markets (84% USHH)

D12 will support further expansionCapacity for more than 200 HD national channels

Channel Expansion

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Consumer Equipment Video

Set-Top Box – Product Strategy

2004/5 2006/7 2008 2009/10

HD Basic

DVR

HD DVR

Basic BasicBasic

HD Basic

HD Basic

DVR

HD DVRHD DVR Whole Home

HD DVR

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20


2004/5 2006/7 2008 2009/10

HD Basic

DVR

HD DVR

Basic BasicBasic

HD Basic

HD Basic

DVR


HD DVR

39


2004/5 2006/7 2008 2009/10

HD Basic

DVR

HD DVR

Basic BasicBasic

HD Basic

HD Basic

DVR


HD DVR

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21

2008 DVR convergenceMid-2008, all DVRs are MPEG4 and HD capable

Model used in SD installs has 100 hours SD storage

Model used in HD installs has 100 hours HD storage

$220$260HD DVR$95$130HD

$170$150DVR$40$45Basic

Q1 ’09EQ1 ’08A

41

OEM Costs

Set-Top Box – Product Line

DIRECTV service using a single cableWire is also used for return pathIntegrated antenna to be launched Q2’08Benefits

Simpler and faster to installImproved installation reliabilityUpgrade from basic to DVR via drop shipmentEasier for consumer to relocate box within homeOne box connected to back channel connects all

Single Wire Installation

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22

MDU Distribution

Unique solution supports reception of all DIRECTV services including HD and International channels

Two technologies availableOne optimized for vertical MDUsAnother for garden-style MDUs

43

InstallationMonitoring connected boxes and proactively correcting existing installsReduced set-top box boot timesSingle antenna with simpler installationBroadband as return channel

Set-top box softwareValidating signal strength at installImproved self-test with suggested actionsRemotely initiated resets

Efficiency Improvements

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23

DIRECTV serves specialized high-end segments with unique

top-of-the-line products

Capitalize on Technology Leadership

45

DIRECTV® Sat-Go

Automobiles & boats

Aircraft

Recreational vehicles

Live DIRECTV Everywhere You Go

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24

Professional DVR

100 hours HD recordingIR remote port, RS-232 control

Rack-mountable chassisOptical fiber HDMI output

HR21 PRO

47

Interactive Platform Across All Products

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25



Home Ecosystem Video

Review of Demonstrations

DVR Scheduler

DIRECTV on Demand

DIRECTV Media SharePersonal content on TVInternet content on TVDIRECTV content on PC

DIRECTV Latin America

50

26

Schedule DVR recordings from directv.com

Use any browser to book programs when away from homeEnabled from mobile phones

DVR Scheduler (Web & Mobile)

Linear & On Demand

Programming

51

Streaming Over IP Infrastructure

Personal Computers

Cell Phones

52

27

DIRECTV Movies Now (Q2 Launch)

Selected moviespushed to

DIRECTV Plus®

DVRs for on demand viewing

Available to all DIRECTV Plus® DVRs

53

DIRECTV On Demand (in Beta)

Relies on satellite and Internet for deliveryIntegrated with linear channels

3,000+ titles today 60+ programmer pages

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Consumers can view personal content & Internet content (photos, music and video) in the living room

DIRECTV Media Share (in Beta)

Internet

55

MusicVideo

Photos

Consumers can view personal content & Internet content (photos, music and video) in the living room

and view recordingson a PC at home

DIRECTV Media Share (coming in 2008)

MusicVideo

Photos

Internet

DIRECTV on PC

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29

L12


Synergies with DIRECTV U.S.Box costsBox featuresSoftware updates

HD service later in 2008HD DVR

LR16

LHR21

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Content Overview

Derek ChangExecutive Vice PresidentContent Strategy and Development

60

Content strategy

Opportunities and challenges

Sports leadership

DIRECTV on Demand

Ad Sales

Agenda

60

31

61

Content Strategy

Extend content leadership

Breadth of programming

HD

Differentiated content

61

62

HD Superiority

62

32

63

DIRECTV vs. Competition

45

-----

45

9

-----

4

15

17

CablevisionNew York

1/22/08

27

-----

27

8

-----

1

-----

18

ComcastPhilly

1/23/08

265192Total HD national channels

-----2215Games-only HD RSNs

2673**107Total with Games-only RSNs

4

5

-----

15

27

Dish2/7/08

7

1

4

-----

14

Time Warner

New York1/22/08

8HD DNS / locals

15HD PPV channels

1124/7 HD RSNs

-----VOOM* channels

58National HD channels

DIRECTV2/21/08

Note: Source for channel counts is company websites, which may contain some discrepancies

*VOOM consists of 15 HD-only channels: Animania HD, Equator HD, Family Room HD, Film Fest HD, GamePlay HD, Gallery HD, HDNews, Kung Fu HD, Monsters HD, Rave HD, Rush HD, Treasure HD, Ultra HD, WorldCinema HD and WorldSport HD

**Last official full channel count was 76, however, only 73 can be accounted for on the Dish website

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64

Programming Opportunities

Optimize programming packagesMaximize value to customerDIRECTV® HD EXTRA PACK

Targeted segmentsLocal International

Leverage existing programming relationships to create unique content

Manage costs

64

33

65

Programming Challenges

Sports CostsNew networks

Retransmission consent

New distribution models

Regulatory environment

65

34



DIRECTV Entertainment

Eric ShanksExecutive Vice PresidentDIRECTV Entertainment

68

Sports Leadership

InteractiveInteractive

Interactive

InteractiveInteractive

68

35

69

36

71

Original Entertainment on The 101

New for 2008New for 2008

Returning / Continuing in 2008Returning / Continuing in 2008

72

The DIRECTV User Experience

DVR SchedulerControl DIRECTV DVR through web or mobile

Moving content around the housePhotos and music todayVideo to and from the PC by Q2 ’08 quarter

Designing new user interface for 2009

DIRECTV on DemandLaunched in Beta in October60+ programmers3,000+ titles

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74

Ad Sales

Leverage new technology and upscale demographic to create new revenue streams

Interactive campaigns at 20% click-through rateGuide bannersTargeted placementLocal ads placed on DVRTelescoping

100,000 Home Panel for new ratings service

Partnership with TNS Media Research

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38



Sales & Marketing

Paul GuyardoExecutive Vice President Sales & Chief Marketing Officer

39

77

Overall

Continue to position DIRECTV as the best in television entertainment

Utilize this positioning to attract and retain most profitable customers

78

Targeting for ProfitabilityLeverage data on existing customers to find like prospects

Attract more customers who look like the 38% who represent 63% of profit

38% of customers account for

63% of profit

29%23%4

9%

20%

33%

15%

% of Subscriber Base

1%

8%

28%

34%

% of Profit

1

2

3

5

Profit Tiers

40

79

Targeting for Profitability (cont’d)

TIER 515% Customers

34% Profit

TIER 423% Customers

29% Profit

DemographicsMen 35+Married

HomeownerIncome >$70K

College/Grad School

Index 120125121130145

Most profitable customers are married, 35+, wealthier, better educated who live in single-family homes

National Advertising Video

41

81

Brand Awareness

DIRECTV unaided brand awareness hit a new high of 50%

DIRECTV approaching near-universal total brand awareness at 93%

Total advertising awareness significantly higher than Dish (61% vs. 47%) and now equal to cable

82

Local Marketing

Attack competitive weaknessesMSO buy-out / transition issuesOutages, repackaging or programming changesCustomer service issues

Maximize competitive strengthsHD local superiorityExclusive programming

42

43

86

2007 Local Marketing Campaigns

Superbowl (4 Markets)

Competitive Issue (2 Markets)

Competitive ( Markets)

Turn Around Campaign (3 Markets)

St. Louis, Cardinals (7 Markets)

Tigers MLB (2 Markets)

Digital Conversion

Transition (3 Markets)

Competitive Customer Service (1 Mkt)

Users Interface Changes (1 Market)

Rural Markets (28 Markets)

Cable Consolidation (3 Markets)

Customer Service Issue (1 Market)

Cable Outage (1 Market)

Competitive (4 Markets)

Digital Tier Transition (3 Markets)

Competitor (10 Markets)

HD (10 Markets)

Digital Tier (1 Market)

Big Ten (6 Markets)

Outage (1 Market)

Outage (1 Market)Customer Over-bills (1 Market)

MASN (5 Markets)

Competitive Advantage (10 Markets)

Service Interruption (1 Market)

NFL Network (5 Markets)

Exclusive Channels (13 Markets)

HD Advantage (23 Markets)

CAMPAIGN1 8 15 22 29 5 12 19 26 5 12 19 26 2 9 16 23 30 7 14 21 28 4 11 18 25 2 9 16 23 30 6 13 20 27 3 10 17 24 1 8 15 22 29 5 12 19 26 3 10 17 24

MLK E M 4th L T C

August SeptemberJulyJuneMayAprilMarchFebruaryJanuary DecemberOctober November

Stadium Trays & Events

44

87

Sales Distribution Trends

0%

10%

20%

30%

40%

50%

60%

2005 2006 2007 2008

Direct Sales Independent Telco CE Other

Conscientiously grow Direct Sales

88

Direct Sales Composition

79

354

380

476K

2006

60

403

429

732K

2007

87

364

214

367K

2005

Other

1-800-DIRECTV

directv.com

Targeted Marketing

Gross Additions

45

46

91

Sales Channels

DIRECTV’s bundle play

Face-to-face saleInternational, in-language expertiseRural

Extends DIRECTV’s “share-of-voice”Pursue more entrepreneurial opportunities

(e.g. mall kiosks, door-to-door)

In-house, national direct marketingQuick to market, targeted, flexible, in-control

Reason for Being

Telco

Local Dealers

National Dealers

Direct Sales

Channel

Channels work together in a complementary fashion

92

National Dealers

Extend DIRECTV’s “share-of-voice”

47

93

BellSouth Recovery Plan

More aggressive Direct Sales efforts in region

Engage strongest local dealers within BellSouth region with unique offer

Sell the bundle ourselves

94

Jump-start Opportunistic Businesses

Commercial

MDU

Más / WorldDirect

48

95

Driving Lower Monthly Churn

InvoluntaryChurn

VoluntaryChurn

2005 2006 2007

0.71%0.57% 0.52%

0.99%1.03%

0.99%

1.51%1.60%1.70%

96

2007 Churn Initiatives

Improved customer analytics

Created a “true” customer retention group (CRG) within Customer Service

Initiated proactive retention marketing

49

97

2008 Churn Initiatives

ICU for “at-risk” customers

Reduce initial 30-day churn

Address customers rolling off commitment

Unique treatment in high-risk geography

Attack causes of telco channel churn

Continue to improve Hispanic churn

True CRG expansion

98

Maximize Return on Retention Spending

42%

58%

% Spend

62%Bottom 3 Tiers

38%Top 2 Tiers

% CustomersCustomerValue Segment

Almost 60% of spend is focused on top two value segments

50



Customer Service Operations

Mike PalkovicExecutive Vice President Operations

51

Call Centers

Field Services

Supply Chain and Logistics

Service Calls and Equipment Replacement Program (ERP)

Customer Service Operations

101

Improve the quality of the service experience for all customers, existing and new, at all points of customer interaction

Improve the cost of providing service by being more efficient, handling interactions properly the first time and making investments in places that directly impact the quality of our service

Finally, the result of this focus on the quality side of the business should and will increase customer satisfaction which in turn also improves our profitability

Major Objectives for 2008

102

52

Customer Care Call Center Network

103

Call Centers – Key Metrics

104

Average Handle Time (sec)

437

457

493

2005 2006 2007

Calls Offered (M)

124

139 138

2005 2006 2007

Cost/Customer/Month

$3.02$3.17 $3.33

2005 2006 2007

Self Care (% of Total Contacts)

34% 34%

38%

2005 2006 2007

53

Improve agent quality –tenure, training, attrition

Lower contact rate1st call resolutionTransfer rate

Increase / improve customer self care

Improve / simplify billing

Reduce agent handle time, without increasing contact rate

Call Centers –Issues / Challenges = Opportunities

105

Align call types with agent skills and tools

Improve training environment

Wage adjustment / incentives tied to tenure / attrition / performance

Launch IM for agent / supervisor interaction

Better use of analytical tools to mine data / comments

Call Centers – Initiatives

106

54

Optionsdirectv.comIVR / natural language

Initiatives / AccomplishmentsCustomer email addresses >40%DVR Scheduler – online, cell phoneImprove account management, redesign dashboardImprove order process – fewer clicks“Green” focus – paperless bill, auto bill payOverall goal is more options, consistent experience

Self Care – Initiatives

107

Home Service Provider Map

108

55

Reduce repeat service callsFocus on quality vs. just quantity

Improve completion rates –without risk to quality

Simplify installation process, even with more advanced products

Automate activation process

Re-evaluate HSP economic relationship

Field Services –Issues / Challenges = Opportunities

109

110

Implement quality-based incentives / penalties for HSPs

Implement hand-held devices across the network

Redesign ODU to simplify installation

Standardize connectors, cables –centralize procurement

Owned and operated – buy vs. build

Field Services – Initiatives

110

56

111

Lower cost of recovered boxesMulti-pack kitHSP pick-up

Revamp repair processImplement auto testersBuilt-in Self Test (BIST)

Remove cables from boxes

Full production of recycled cardsRamp to 400-500K cards per month

Supply Chain / Logistics – Initiatives

111

112

Improve equipment qualityBoxesODUsConnectorsSwitches

Improve field technician qualityDish pointingTrouble shooting skills in the fieldRepeat visits

Unnecessary truck rollsDiagnostic capabilitySimplify complexity of the equipment / installation

Service Calls / ERP –Issues / Challenges = Opportunities

112

57

113

Box specific issues – downloads

Automation – remote reset, auto cancel, BIST

Re-design ODU, simplify, new mounts

Standardize connectors, cables

Revamp repair facilities

Double / triple case management –3rd down to 2nd

Service Calls / ERP – Initiatives

113

58




Bruce ChurchillPresident DIRECTV Latin America

116

First full year of consolidated operations

Executed on our key operational goalsCompleted integration of Brazilian businessesGrew PanAmericana to scale

+400k net adds in 2007+1.7 million YE subscribers

Expanded content and technology leadership Updated satellite fleet

Solidified our financial performance

2007 – A Milestone Year

59

117

Exclusive programmingLa Liga, EPLConcerts, special events

Enhanced / interactive applicationsNFL SUNDAY TICKET®

NASCAR HotPass™MLB Strike Zone

Expanded coverageU.S. Open Tennis

Content Leadership

118

Leverage DTVUS’ scale and technology Speed to market

Superior product

Lower cost

Technology Leadership

60

119

Update Satellite Fleet

IS 11

Online January 2008 Expanded capacity

18 transponders~250 video channels

Replaced failing IS 6B

Same orbital slot

Improved performance

IS 16

Estimated H2 2009Shared back-up for IS 9 and IS 11 Expanded capacity for MexicoCo-locate with IS 9 at 58°24 transponders

120

Financial Results - 2007

Selected Financial Information (in US$ millions) May Outlook Actual

Revenue ~$1,600 1,719$ OPBDA ~$350 394$ Operating profit ~$120 159$

CapExSAC related ~$175 296$ Non-SAC related ~50 40 Sub-Total ~$225 336$

Cash flow before interest and taxes ~$165 140$

End of period subscribers (000's) ~3,100 3,279 Gross additions (000's) ~900 1,080 Net additions (000's) ~400 588

ARPU (US$) ~$46 48.33$ Monthly churn ~1.35% 1.38%SAC (US$) ~$380 361$

61

121

StrategyContinue to enhance TV experience

Exclusive programmingEnhanced features

Maximize growth opportunitiesExpand Pre-paid in key marketsIncrease multiple set-top box penetration

Continue focus of delivering superior financial results

2008 and Beyond

122

Enhance “TV Experience”

Enhancement in PanAmericanaGame LoungeMix channelsSMS functionalityCartelera

Expanded interactivity in BrazilEPG, games, self care

Expand local markets in Brazil

Solidify key programming contracts

62

123

Push “whole home experience”Increase DVR penetration and mirrors

Launch HDPanAmericana – H2 2008Brazil / Mexico – H2 2009

Expand Pre-paid offerMexico BrazilPanAmericana - Colombia, Chile

Maximize Growth

124

Venezuela

63

125

Customer Proposition

Packages

# of Channels 14 ChannelsLocal content only 40 Channels 71 Channels

PricesVAT included ~$7 ~$29 ~$42

NEW

PREFERENCIAL

Pre-Pago DIRECTV - Venezuela

Buy scratch card Enjoy DIRECTVexperience

Buy kit

Self Installation

Self Installation

Enter PIN # to activate

Enter PIN # to activate

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High familiarity with pre-paid95% of cell phone market is pre-paid

Completely cash based

Favorable economicsMinimum net SAC No bad debtMinimum on-going subscriber costs

80% reactivation behavior after first 3 months


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‘Diario El Universal. Caracas. Venezuela’.



SKY Mexico

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129

Operational Highlights - Mexico

Deliver best exclusive and non-exclusive programming content

La LigaLocal soccerReality shows (e.g. Big Brother, El Bar)

Launch SKY operations in Costa Rica and Dominican Republic

Increased multiple set-top box penetration

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Financial Highlights - Mexico

* Includes acquired subscribers of 110K in 2005 and 20K in 2007

*

Selected Financial Information (in US$ millions) Actual Actual Actual2005 2006 2007

Revenue 550$ 684$ 752$ OPBDA 231$ 326$ 364$

CapExSAC related 90$ 84$ 108$ Non-SAC related 19 7 14 Sub-Total 109$ 91$ 122$

Cash flow before interest and taxes 103$ 204$ 269$

End of period subscribers (000's) 1,250 1,430 1,585 Gross additions (000's) 447 380 408 Net additions (000's) 248 180 155

ARPU (US$) 39.50$ 40.90$ 41.90$ Monthly churn 1.2% 1.0% 1.1%SAC (US$) 350$ 370$ 423$

*

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133

Financial Information

Note: Excludes Sky Mexico

(in US$ millions) Outlook 2006 Outlook Actual 2009

Revenue 1,013$ ~$1,600 1,719$ ~ $2,000OPBDA 244$ ~$350 394$ ~ $600Operating profit 79$ ~$120 159$ ~ $400

CapExSAC related 130$ ~$175 296$ Non-SAC related 49 ~50 40 Sub-Total 179$ ~$225 336$ ~ $250

Cash flow before interest and taxes 0$ ~$165 140$ ~ $400

2007

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Key Metrics

Note: Excludes Sky Mexico

Outlook 2006 Outlook Actual 2009

Subscribers (000's) 2,711 ~3,100 3,279 ~ 4,000

ARPU (US$) 41.71$ ~$46.00 48.33$ ~$48

Monthly churn 1.45% ~1.35% 1.38% ~1.3%

SAC (US$) 371$ ~$ 380 361$ ~$395

2007

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Chase CareyPresident and CEO

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U.S. Pay TV Market – Net Additions

Cumulative Net Adds

<(1)M(1)MCable/Other

<3M2 – 3MTelco

<5M4 – 5MSatellite

2008 Projectionfor 2006 - 2008

2006 Projection For 2006 - 2008

137

DIRECTV Prior 2008 Outlook

Double-digit CAGRRevenues

$1.2BUpgrade & Retention(excluding swaps)

$3BCash Flow Before Interest & Taxes

$650 - 700SAC

5%+ CAGRARPU

Steady ImprovementChurn

~18MCum Subscribers

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HD and DVR Subscribers Yield Strong Returns

53%$7570.8%44%$95

2007Actual

48%IRR$685SAC*1.0%Churn43%Variable Margin$83ARPU

2006 Projection for

2008

New Customers

* Net of upfront revenues

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DIRECTV Prior 2008 Outlook

Double-digit CAGRRevenues

$1.2BUpgrade & Retention(excluding swaps)

$3BCash Flow Before Interest & Taxes

$650 - 700SAC

5%+ CAGRARPU

Steady ImprovementChurn

~18MCum Subscribers

140

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Solid Subscriber Growth

Continued focus on quality customers

Increased penetration of HD and DVR subscribers

50% penetration at year-end 2008

70% at year-end 2010

Direct Sales strength

Attack key niches

Cum net adds of 1.5-2.0M over three years

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Churn Improvement

Focused on quality customers

Limit risky subscribers

HD and DVR penetration

Improved customer service

Continued steady improvement

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Strong ARPU Growth

Increased advanced products

Modest price increases

Build emerging revenues streams

ChallengesIncreased offersReduced hardware revenues

5%+ CAGR

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Stabilize Subscriber Acquisition Costs (SAC)

Increased pressureDemand for advanced productsTechnology investments

OffsetsContinued box cost reductionsUse of refurbished boxesStreamline installation Improve sales channels’ efficienciesOptimize dealer / installer compensation structure

$700+ SAC

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Reduce Upgrade Investment Costs

Reduced pent-up demand

Box cost reductions + refurbished boxes

Technology improvementsReduce truck rolls and box replacements

Target the right customers

Incentives to upgrade at acquisition

Maintain spending below the 2007 level

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Margin Improvement for Other Key Costs

Programming Expenses2008 programming expense increases 5% / subscriber

Subscriber Services ExpensesDrive call center costs to $3 / subscriber / month

G&AContinued margin improvement

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Capital Expenditures(excluding set-top boxes)

Nearing end of satellite expansion plan

HD ground infrastructure completed in 2008

2008 spending down $200M

Sustaining CapEx target of $500M

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DIRECTV U.S. Financial Overview

Revenues of $20B in 2010

OPBDA margin approaches 30%

Cash Flow Before Interest and Taxes2008 over $1B higher than 20072010 ~$4B

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The DIRECTV GroupNon-GAAP Financial Measure Reconciliation Schedules(Unaudited)

2007 2006 2005

Operating Profit Before Depreciation and Amortization $4,170 $3,391 $1,486

Subtract: Depreciation and amortization expense 1,684 1,034 853

Operating Profit $2,486 $2,357 $633 Revenue $17,246 $14,755 $13,164 OPBDA Margin 24.2% 23.0% 11.3%

2007 2006 2005

Cash Flow Before Interest and Taxes $1,480 $1,313 $386 Adjustments: Cash paid for interest (230) (243) (240) Interest income 111 146 150 Income taxes paid (408) (30) (13)Subtotal - Free Cash Flow 953 1,186 283 Add Cash Paid For: Property and equipment 2,523 1,754 489 Satellites 169 222 400 Net Cash Provided by Operating Activities $3,645 $3,162 $1,172

Twelve Months EndedDecember 31,

(Dollars in Millions)

December 31, Twelve Months Ended

Reconciliation of Operating Profit Before Depreciation and Amortization to Operating Profit

Reconciliation of Cash Flow Before Interest and Taxes and Free Cash Flow to Net Cash Provided by Operating Activities


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DIRECTV HOLDINGS LLC (DIRECTV U.S.)

Non-GAAP Financial Measure Reconciliation(Unaudited)

2007 2006 2005

$3,850 $3,221 $1,500 expense 1,448 873 698Operating Profit $2,402 $2,348 $802 Revenue $15,527 $13,744 $12,216 OPBDA Margin 24.8% 23.4% 12.3%

2010 Outlook 2008 Outlook 2007 Actual 2006 Actual 2005 Actual

Cash Flow Before Interest and Taxes ~$4,000 over $2,455 $1,455 $1,418 $774 Adjustments: Cash paid for interest* - ~(200) (211) (215) (229) Interest income 69 69 26 Income taxes paid ~ (1,300) ~(900) (730) (728) (36)Subtotal - Free Cash Flow ~2,700 over $1,355 583 544 535

Add Cash Paid For: Property and equipment 621 504 381 Subscriber leased equipment - subscriber acquisitions 762 599 -

Subscriber leased equipment - upgrade and retention 774 473 - Satellites 169 222 367 Subtotal - Cash Paid for PP&E ~1,800 ~2,000 2,326 1,798 748

Net Cash Provided by Operating Activities ~$4,500 over $3,355 $2,909 $2,342 $1,283

Outlook for 2008 and 2010 nets interest income and interest expense as well as combines all capital into Property and Equipment





Operating Profit Before Depreciation and Amortization



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Non-GAAP Financial Measure Reconciliation(Unaudited)

2009 Outlook2007 May Outlook 2007 2006

Operating Profit Before Depreciation and Amortization $600 $350 $394 $244 Subtract: Depreciation and amortization expense 200 230 235 165Operating Profit $400 $120 $159 $79 Revenue $2,000 $1,600 $1,719 $1,013 OPBDA Margin 30.0% 21.9% 22.9% 24.1%

2009 Outlook2007 May Outlook 2007 2006

Cash Flow Before Interest and Taxes $400 $165 $140 $0 Adjustments: Cash paid for interest (27) (12) Interest income 18 16 Income taxes paid * (100) (25) (51) (14)Subtotal - Free Cash Flow 300 140 80 (10)Add Cash Paid For:

Property and equipment 250 220 336 175 Net Cash Provided by Operating Activities $550 $360 $416 $165





*Outlook data combines interest received, interest paid and income taxes paid under income taxes paid




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Economy & Finance

direc tv group The DIRECTV Group, Inc. Investor Day