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DirecTV Expects Slower Growth

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NEW YORK -- Leading satellite television provider DirecTV said Monday that its subscriber growth will drop from previously forecast levels because of a slowing economy, sluggish sales in rural areas and a change in its marketing strategy in Latin America.

In a conference call with investors, management of DirecTV parent Hughes Electronics Corp. also conceded that their involvement in ongoing negotiations over a possible merger of the company with News Corp.'s Sky Global Networks satellite assets had distracted attention from operational management of the business. DirecTV said it now expects to add about 1.3 million additional subscribers during 2001, taking its year-end customer count to 10.8 million. It previously estimated that it could add 1.5 million-1.7 million new subscribers this year to take its service into 11 million-11.2 million homes.

DirecTV's confirmation of a slower expected growth rate came as smaller rival EchoStar Communications said it had passed the 6 million subscribers mark after adding 1 million subscribers during the past seven months. Claiming to be "the fastest-growing U.S. pay television provider," EchoStar said it expects to add a total of 1.7 million new subscribers this year to take its total subscriber count to close to 7 million.