HNS rethinks Direcway entry strategy

By Susan Rush
from CED Broadband Direct, July 17, 2002

Hughes Network Systems is trying to wipe out consumers' "Oh my god," reaction to the upfront cost of hardware and installation for its Direcway broadband-by-satellite service with a new program that enables customers to pay over time.

Under the terms of the new Direcway 99/99 Program, consumers who purchase Direcway from DirecTV Inc. will pay $99.99 up front and $99.99 per month for a minimum of one year to cover monthly service and the remaining hardware and installation costs. After the first year of service, the monthly fee drops to $59.99.

The program is designed to take the sticker shock out of the equation. Typically, Direcway subscribers pay $598 up front -- $399 for hardware and up to $199 for installation. If a consumer does not opt to subscribe to the 99/99 program, DirecTV is offering hardware and installation at a promotional price as low as $579, which is comparable to the amount the 99/99 subscribers will have paid at the end of the first year.

Separately, HNS inked a deal to deliver its Direcway service to SBC Communications' customers in Texas. SBC will begin marketing the service this summer. "This agreement brings this capability to more Texans -- and helps fulfill our goal of making Texas one of the most broadband-enabled states in the country," says Shawn McKenzie, president, SBC Southwestern Bell -- Texas.

SBC Southwestern Bell customers will have two payment options for the Direcway hardware, installation and service: a traditional upfront purchase of hardware and installation, plus a monthly fee of $59.99 for unlimited hours of broadband Internet access; or the new 99/99 Program.