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May 23, 2003  •  Post A Comment

Judge Rules on DirecTV and Pegasus

A federal judge late Thursday limited the issues at trial in a dispute between No. 1 digital broadcast satellite provider DirecTV and Pegasus Communications and the National Rural Telecommunications Cooperative. The conflict arises out of a 1992 contract that permitted the NRTC to distribute certain DirecTV services in rural parts of the country.

This development represents the latest chapter in an ongoing battle between DirecTV and Pegasus and NRTC that began in 1999, when the NRTC and DirecTV failed to agree on whether DirecTV should recognize an agreement inked with DirecTV’s predecessor, Hughes Communications Galaxy, to supply NRTC with certain programming that would be delivered to rural customers. The issue came to a head when DirecTV began marketing services that had been funneled through NRTC directly to satellite customers, NRTC has said.

In the latest decision, Federal District Court Judge Lourdes Baird’s ruling effectively prevents Pegasus and NRTC from potentially being able to collect more than $150 million in damages from DirecTV.

However, Judge Baird’s ruling did not affect a $50 million claim that DirecTV filed against Pegasus, alleging breach of contract on a joint marketing agreement related to a rural distribution pact. That case is slated to begin June 3.

TiVo Cuts Losses, Continues to Grow: Digital video recording company TiVo reported a narrowed fiscal first-quarter loss, buoyed by strong subscriber growth, and forecast that it would reach more than 1 million users by January 2004.

The San Jose, Calif.-based company reported red ink of $7.9 million, or 12 cents a share, for the three months ended April 30, sharply improved from a year-earlier loss of $35.2 million, or 74 cents a share. Revenue soared 63 percent to $16.1 million from a year-earlier figure of $9.9 million.

The improvement came as the company reported that it added 79,000 new customers during the period, vs. 42,000 a year earlier. TiVo’s total subscriber base is now 703,000, and the company said it expects to add another 450,000 to 600,000 subs by Jan. 31, 2004.