Filed by HEC Holdings, Inc.
                                   Subject Company - General Motors Corporation
                                             and Hughes Electronics Corporation
                                        and EchoStar Communications Corporation
                          Pursuant to Rule 425 under the Securities Act of 1933
                                       and Deemed Filed Pursuant to Rule 14a-12
                                      under the Securities Exchange Act of 1934
                                                 Commission File No.: 333-84472

The following is a transcript of a conference call made available on Hughes'
website beginning April 17, 2002.  Certain text contained within the transcript
has been bracketed because it was inaudible.

In connection with the proposed transactions, on March 18, 2002, General Motors
Corporation ("GM"), HEC Holdings, Inc. ("Hughes Holdings") and EchoStar
Communications Corporation ("EchoStar") filed preliminary materials with the
Securities and Exchange Commission ("SEC"), including a Registration Statement
of Hughes Holdings on Form S-4 that contains a consent solicitation
statement/information statement/prospectus. These materials are not yet final
and will be amended. Holders of GM $1-2/3 and GM Class H common stock are urged
to read the definitive versions of these materials, as well as any other
relevant documents filed or that will be filed with the SEC, as they become
available, because these documents contain or will contain important
information. The preliminary materials filed on March 18, 2002, the definitive
versions of these materials and other relevant materials (when they become
available), and any other documents filed by GM, Hughes Electronics Corporation
("Hughes"), Hughes Holdings or EchoStar with the SEC may be obtained for free at
the SEC's website,, and GM stockholders will receive information at
an appropriate time on how to obtain transaction-related documents for free from

GM and its directors and executive officers, Hughes and certain of its officers,
and EchoStar and certain of its executive officers may be deemed to be
participants in GM's solicitation of consents from the holders of GM $1-2/3
common stock and GM Class H common stock in connection with the proposed
transactions. Information regarding the participants and their interests in the
solicitation was filed pursuant to Rule 425 with the SEC by EchoStar on November
1, 2001 and by each of GM and Hughes on November 16, 2001. Investors may obtain
additional information regarding the interests of the participants by reading
the preliminary consent solicitation statement/information statement/prospectus
filed with the SEC on March 18, 2002 and the definitive consent solicitation
statement/information statement/prospectus when it becomes available.

This communication shall not constitute an offer to sell or the solicitation of
an offer to buy, nor shall there be any sale of securities in any jurisdiction
in which such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such
jurisdiction. No offering of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities Act of 1933,
as amended.

Materials included in this document contain "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors that could cause our actual results to be materially different
from historical results or from any future results expressed or implied by such
forward-looking statements. The factors that could cause actual results of GM,
EchoStar, Hughes, or a combined EchoStar and Hughes, to differ materially, many
of which are beyond the control of EchoStar, Hughes, Hughes Holdings or GM
include, but are not limited to, the following: (1) the businesses of EchoStar
and Hughes may not be integrated successfully or such integration may be more
difficult, time-consuming or costly than expected; (2) expected benefits and
synergies from the combination may not be realized within the expected time
frame or at all; (3) revenues following the transaction may be lower than
expected; (4) operating costs, customer loss and business disruption including,
without limitation, difficulties in maintaining relationships with employees,
customers, clients or suppliers, may be greater than expected following the
transaction; (5) generating the incremental growth in the subscriber base of the
combined company may be more costly or difficult than expected; (6) the
regulatory approvals required for the transaction may not be obtained on the
terms expected or on the anticipated schedule; (7) the effects of legislative
and regulatory changes; (8) an inability to obtain certain retransmission
consents; (9) an inability to retain necessary authorizations from the FCC; (10)
an increase in competition from cable as a result of digital cable or otherwise,
direct broadcast satellite, other satellite system operators, and other
providers of subscription television services; (11) the introduction of new
technologies and competitors into the subscription television business; (12)
changes in labor, programming, equipment and capital costs; (13) future
acquisitions, strategic partnership and divestitures; (14) general business and
economic conditions; and (15) other risks described from time to time in
periodic reports filed by EchoStar, Hughes or GM with the Securities and
Exchange Commission. You are urged to consider statements that include the words
"may," "will," "would," "could," "should," "believes," "estimates," "projects,"
"potential," "expects," "plans," "anticipates," "intends," "continues,"
"forecast," "designed," "goal," or the negative of those words or other
comparable words to be uncertain and forward-looking. This cautionary statement
applies to all forward-looking statements included in this document.


                              Moderator: Jon Rubin
                                 April 15, 2002
                                   1:00 pm CT

Operator: Good day everyone and welcome to today's Hughes Electronics
         Corporation 2002 First Quarter Earnings Results Conference Call.
         Today's conference is being recorded. At this time for opening remarks
         and introductions, I would like to turn the conference over to the Vice
         President of Investor Relations, Mr. Jon Rubin. Please go ahead, sir.

Jon Rubin: Thank you, Operator and thank you everyone for joining us on our
         First Quarter 2002 Earnings Conference Call. With me today on the call
         are Jack Shaw, our President and CEO, Eddy Hartenstein, Chairman and
         CEO of DIRECTV, Roxanne Austin, President and COO of DIRECTV, Mike
         Gaines, our CFO, Kevin McGrath, Chairman of DIRECTV in Latin America,
         Pradman Kaul, Chairman and CEO of Hughes Network Systems, Pat Doyle,
         our Controller and Treasurer and the CFO's of our major businesses.

         Before we proceed, I'd like to remind you that our use of the words
         "expect, anticipate, project" and similar expressions are intended to
         identify forward-looking statements. While these statements represent
         our current judgment on what the future may hold and we believe that
         they are reasonable, actual results may differ materially due to
         important factors, including those described in our SEC filings and in
         General Motors SEC filings.

         And now, I'd like to turn the call over to Jack Shaw for a few opening

Jack Shaw: Thank you, Jon. As you probably saw on our earnings release we
         have a lot of information to share with you today. So I'd like to take
         a moment to briefly comment on HUGHES first quarter results.

         When looking at our First Quarter Operating Results, I conclude that
         the underlying performance of our businesses is strong and consistent
         with the goals we had shared with you on prior calls. I'm particularly
         pleased to see that DIRECTV's economic model continues to improve and
         demand for DIRECTV in the United States remains extremely robust. In
         fact, I was happy to learn that we had our best ever first quarter in
         terms of gross adds.

         It really seems as if our new programming packages and retail offers as
         well as ever-increasing word of mouth advertising from our large
         customer base continues to drive demand for DIRECTV. I'm even more
         pleased to see that all of the hard work devoted to shrinking our cost
         structure and operating more efficiently is starting to pay off. This
         is best demonstrated by DIRECTV's EBITDA in the first quarter, which
         met its target even though we signed up many more new subscribers than
         anyone expected.

         In addition to the strong subscriber and EBITDA numbers, you will hear
         from Roxanne in just a few moments that DIRECTV's revenues, churn and
         margins also came in at or better than our expectations. It gives me
         great pleasure to see this kind of performance from DIRECTV.

         We also had strong first quarter results at PanAmSat, which attained an
         EBITDA margin of 73%, its highest level since 1999. I'll be brief with
         my comments on PanAmSat since I realize many of you listened to their
         first quarter call last Friday.

         And Hughes Network Systems, or HNS, put up solid numbers while winning
         several large contracts in their enterprise broadband business and
         helping DIRECTV meet its strong demand by shipping 430,000 DIRECTV
         Set-Top Receivers.

         The news in the quarter was not all good, however, because we finally
         got our arms around the impact of the Argentinean currency devaluation.
         As you know the economy in Argentina is very volatile and the


         devaluation of the peso directly impacts our DIRECTV Latin American
         operations resulting in a first quarter loss of $32 million.

         I'm sure you also noticed that we had several unusual items in the
         quarter. In a moment, Mike will spend some time helping you understand
         these a little better. From my perspective, the unfortunate part about
         these one-time items is that they tend to blur the progress we've made
         in our core operations.

         During this call, one of the themes you will hear about today is how
         we're trying to simplify and clarify our communications while also
         increasing the transparency into our key value drivers. For example,
         beginning with this quarter's earnings release, we're providing new
         data related to the key financial metrics for DIRECTV US. This is in
         response to requests from many investors and analysts and we hope that
         this type of information will help you better understand our

         Before turning the call over to Mike, I'd like to provide you with a
         quick update on our financing and on the merger with EchoStar. Last
         month, we successfully completed the financing of our 2002 funding
         requirements. The final tranche of this financing was a $765 million
         loan that was substantially over-subscribed. In my opinion, this strong
         demand is further validation that HUGHES is on the right track. In a
         moment, Mike will give you more color on our overall results and
         balance sheet.

         And, finally with regards to our merger with EchoStar, we are
         continuing to provide data and respond to various requests by both the
         Department of Justice and the Federal Communications Commission. As you
         may have read in the papers a few weeks ago, the FCC requested
         additional information and suspended its self-imposed 180-day deadline
         for completing its review of the merger until we, along with GM and
         EchoStar, complete this data request.

         We are working diligently to respond to all of the pending FCC requests
         and we expect to have it wrapped up within a couple of weeks. However,
         we wouldn't be surprised to see the FCC continue to ask for additional


         data. In general, I would say that the regulatory process is proceeding
         as expected and we continue to believe that we will receive regulatory
         approval by the fourth quarter.

         In wrapping up my comments, I'd like to give a special thanks to all of
         the HUGHES employees who, to a person, have performed brilliantly
         during these extremely challenging times. I believe that the results
         over the past three quarters provide the best evidence of all that
         HUGHES is totally focused on improving operations and completing the
         merger process to unlock our store of value for the GMH Shareholders. I
         think you can see a clear pattern developing and understand that this
         is a management team that understands its priorities and will deliver
         on its commitments. With that, I'll turn the call over to Mike.

Michael Gaines: Thanks, Jack. Let me start with a quick overview of our
         financial performance. In a moment, our business unit leaders will
         provide a detailed discussion of revenue and EBITDA results for their
         respective businesses. So I'll just comment on the consolidated HUGHES

         HUGHES revenues for the first quarter came in at more than $2 billion,
         which is nearly 8% higher than the first quarter last year. And our
         EBITDA was $134 million vs. $113 million last year. Our primary driver
         of our revenue and EBITDA growth continues to be the improving
         operating performance at DIRECTV US.

         Included in our results for the quarter are some unusual items and I'd
         like to take a moment to describe them. The first is a $95 million
         EBITDA gain resulting from a favorable court ruling related to a decade
         old lawsuit filed against NASA. The lawsuit was based on NASA's breach
         of contract to launch ten satellites on the Space Shuttle. We've been
         informed that the government plans no further appeal, so we are booking
         the gain now, net of legal fees. This gain is included in the income
         statement on the selling, general and administrative expenses line.

         Additionally, in the Direct-to-Home segment, we recorded an $83 million
         charge related to losses associated with a contractual dispute with
         General Electric Capital Corporation or GECC. Fifty-six million dollars


         of this loss is included in EBITDA and is reported on the income
         statement on the SG&A line. This dispute dates back to a 1995 agreement
         whereby GECC established and managed a credit a program for consumers
         who purchased DIRECTV equipment and programming. In July, 2000, the
         Jury returned a verdict in favor of GECC for $133 million and the trial
         Judge issued an order granting GECC and additional $49 million in
         interest penalties.

         While we're appealing both the Jury verdict and the interest penalty,
         we have taken an additional charge of $83 million for potential losses
         based on our current assessment of the case.

         And, as Jack mentioned, we also had a $32 million EBITDA loss at
         DIRECTV Latin America due to the devaluation of the Argentinean peso.
         Kevin McGrath will provide more insight regarding this devaluation
         later on the call.

         Also during the quarter, HUGHES recorded a $29 million loss related to
         a guarantee of $52 million of bank debt owed by an investor in an HNS
         affiliate in India. The $29 million charge represents the amount of
         HUGHES potential obligation under the guarantee, net of anticipated
         loan and collateral proceeds. This is recorded on our income statement
         as "Other, net" and does not impact EBITDA.

         Given the current market environment and the sensitivity surrounding
         this particular topic, I want to address the HUGHES situation with
         respect to off-balance sheet guarantees. As disclosed in our 10-K,
         excluding the guarantees for the HNS affiliate in India that I just
         discussed, the remaining amount of debt guaranteed by HUGHES is under
         $20 million and we do not expect to perform on these remaining

         Now, let's review HUGHES Balance Sheet and liquidity position. As of
         the end of the first quarter, our cash balance was about $1.1 billion,
         which is more than $400 million higher than the balance as of the end
         of last year. Total debt was nearly $3.4 billion, which increased more
         than $700 million during the quarter. The major uses of cash in the
         quarter were for satellite and capital expenditures as well as the
         final payment of $134 million relating to the purchase price adjustment
         with Raytheon.


         During the quarter, we completed a series of financing transactions
         that provided the company with significant new liquidity. As part of
         the financing, PanAmSat raised $2.05 billion in new bank debt and
         long-term notes, most of which was used to repay the $1.725 billion
         loan that HUGHES extended to PanAmSat back in 1997.

         In additional to providing increased liquidity to HUGHES, this
         repayment allowed HUGHES to access a credit line arranged with General
         Motors Acceptance Corporation that provides $500 million of new

         Also during the quarter, HUGHES completed the restructuring of its
         credit facilities. Our prior $750 million revolver, which we had
         completely drawn at the end of 2001, was amended to increase in size to
         more than $1.2 billion. At the end of the first quarter, no amounts
         were outstanding under this line. The various credit facilities
         associated with DIRECTV Latin America businesses were repaid in the
         first quarter. And as Jack indicated earlier, the new revolver was
         supplemented with the placement of a $765 million dollar institutional
         term loan last month.

         After completing these transactions, the combination of our cash on
         hand and available debt capacity provides more than enough liquidity to
         fund our remaining cash requirements through the anticipated close of
         the merger with EchoStar.

         Let me now take just a minute to discuss the new accounting standard on
         goodwill, Statement of Financial Accounting Standards No. 142 and its
         impact on HUGHES. We are currently in the process of implementing the
         new accounting standards, which requires that goodwill be tested for
         impairment as of January 01, 2002. At this time, it appears that we
         will need to perform the comprehensive appraisal of the assets and
         liabilities required by FAS 142 for PanAmSat, DIRECTV Latin America and
         DIRECTV Broadband.


         Because these appraisals are not yet completed, we are not able to
         estimate an amount of goodwill write-down, if any, at this time. The
         total amount of goodwill recorded for each of the entities is
         approximately $2.7 billion for PanAmSat, $600 million for DIRECTV Latin
         America and $100 million for DIRECTV Broadband.

         Now let's move on to guidance for the second quarter and full year.
         Again, since the business units will individually discuss their
         projections, I'll stick to the guidance to the consolidated HUGHES.

         Second quarter revenue is expected to come in between $2.1 and $2.2
         billion with EBITDA with $80 to $110 million. Even though we've had
         several one-time items and are now reflecting the impact of the
         Argentinean currency devaluation on DIRECTV Latin America, we still
         expect to attain our prior year our prior full-year guidance for both
         revenue and EBITDA of $9 to $9.2 billion and $750 to $850 million,
         respectively. Additionally, our full-year cash requirements of $1.5 to
         $1.7 billion are unchanged from our prior forecast.

         As always, I invite you to look at our Earnings Release for a
         comprehensive view of all of our guidance. With that, I'd now like to
         turn the call over to Roxanne for comments on DIRECTV US.

Roxanne Austin: Thanks, Mike. DIRECTV's improved operating results in the first
         quarter continue to validate the strategies that we put in place in the
         second half of last year. This is the third consecutive quarter that we
         have posted subscriber growth numbers that have exceeded expectations
         and I applaud the efforts of the entire team at DIRECTV, which has
         implemented so many successful tactics to make this happen.

         Before looking at our results, as Jack mentioned earlier, we have a new
         schedule included in the Quarterly Earnings Release that shows the key
         DIRECTV US financial metrics. The numbers I'll be sharing with you in a
         moment are reflected in this new schedule.


         Demand for DIRECTV in the US remains very strong. During the first
         quarter, excluding subscribers in NRTC territories, DIRECTV added
         approximately 764,000 growth subscribers. The most growth adds for a
         first quarter in the eight-year history of DIRECTV. After accounting
         for customer churn, we added 350,000 net new subscribers.

         Part of our strong demand is due to our simplified programming, our new
         packages and our new retail promotions. We now have a standard 365-day
         a year offer whereby a customer can have one box installed for $49 or
         less and two boxes installed for $99 or less. In addition, many
         retailers are taking advantage of the opportunity to increase DIRECTV
         sales by discounting these price points even further on their own

         As in all DIRECTV funded offers, to enjoy these benefits customers are
         required to make a 12-month service commitment. And to keep the offer
         fresh from quarter to quarter, we'll layer on additional promotions
         such as free or discounted programming for a limited time.

         And our new programming packages, which we started offering on February
         1st, also seem to be very popular. Especially popular is the new Total
         Choice Plus offering which includes over 130 channels including local
         channels where available. This package sells for $39.99 per month and
         provides customers with a very attractive value proposition compared to
         so-called "digital cable packages"; where local channels and many of
         the cable networks are still in analog format.

         The one common thread between the new retail offers and the consumer
         promotions is simplicity. They're easier for the customer to understand
         and they're easier for the retailer to sell.

         Another key driver of the lift in demand is attributable to the fact
         that we now offer all local channels in our 41 local channel markets.
         This was made possible by the successful launch last December of
         DIRECTV 4S our spot-beam satellite. All of our customers, including our
         installed base in our 41 local channel markets can receive their local
         channels via a single dish.


         In the 41 markets where we provide local channels, DIRECTV has now a
         superior all digital cable replacement offer for consumers. We have
         seen in these 41 markets that demand, in terms of gross subscriber
         additions is up over 20% over last years first quarter. Importantly, in
         our largest markets such as New York, Los Angeles, Chicago, Miami and
         San Francisco, we're seeing our highest growth rates in some cases over

         And we're also seeing a significant increase in new customers signing
         up for local channels. For example, last year we were attaining local
         channel penetration rates for new customers at just over 60%. And
         today, with all local channels available in 41 markets, over 70% of our
         new customers are purchasing packages that include local.

         While these factors are driving new customer demand, they are also
         helping retain our current customer base. For the first quarter, churn
         was 1.6%, which compares favorably to the 1.8% turn we experienced in
         the first quarter of last year and the 1.7% for the fourth quarter of
         this year. Although there's always room for improvement, we feel pretty
         good about how we're faring on our battle against churn. We expect the
         first quarter performance to continue in the second quarter and improve
         even further in future quarters.

         As a result of the continued strong demand and improved churn
         management, we now believe that we're able to add approximately 1.2
         million customers this year, up from our prior guidance of one to 1.2
         million. This is significant because this revision includes only
         DIRECTV core subscribers and excludes NRTC subscribers. Effectively,
         this represents a 200,000 increase in net additions for DIRECTV core
         customers vs. our prior guidance.

         I know a lot of investors are asking about what our strategy is with
         respect to Radio Shack and what we plan to do to make up for lost sales
         due to Radio Shacks decision to go non-exclusive. As most of you know,
         Radio Shack was unable to reach an agreement with the NRTC and Pegasus
         to be compensated for DIRECTV sales in NRTC territories. As a result,
         they made the decision to begin distributing Dish Network.


         First, let me say that we expect to do well at Radio Shack based on our
         brand, strong consumer offers and our differentiated content offerings
         including expanded local channels on one dish.

         More importantly, Radio Shack is only one piece of a first rate
         distribution network that is highly committed to the DIRECTV service.
         We are working closely with our entire distribution network, and
         particularly those partners who remain focused on the DIRECTV service
         to ensure that they have the tools to aggressively promote and take
         advantage of the improved DIRECTV service and customer offerings.

         In short, while we regret the loss of our exclusivity at Radio Shack,
         we remain confident in the breadth, experience and motivation of our
         overall distribution network as evidenced by the fact that we're
         raising our subscriber guidance for the full year by 200,000.

         One more point to address before moving off the topic of subscribers.
         As you may have seen in the press release this morning, we announced
         today that we are no longer counting what we had referred to as
         "pending subscribers". Those subscribers who purchase equipment and
         entered all the required customer information into our billing system,
         but had not yet activated service. We began including pending
         subscribers to part of our subscriber base in the early years of
         DIRECTV, specifically the second quarter of 1995 when they amounted to
         a larger percentage of DIRECTV's customers.

         At that time, there was a much longer lag between the time the customer
         purchased equipment and entered all the necessary information from when
         they activated the service. This was due primarily to more customers
         self-installing their equipment and a significantly smaller
         installation network. So pending subscribers made sense because it more
         accurately reflected DIRECTV's growth.

         As DIRECTV has grown to over 10 million customers, pending subscribers
         represent a smaller percentage of our subscriber base. In fact, over
         the past couple of years, the total number of pending subscribers has
         remained relatively flat. This tells us that although this policy was
         meaningful several years ago; our business has evolved to the point


         where the inclusion of pending subscribers is no longer needed to help
         explain our business performance.

         Moreover, since a high percentage of these pending subscribers become
         active subscribers, we believe that this policy change reflects a
         simplified approach to counting our subscribers consistent with the
         rest of the multi-channel industry. In fact, including pending
         subscribers as part of our customer base today actually distorts
         DIRECTV's true operating performance who are, for example, artificially
         depressing revenue per user or ARPU.

         So how does this decision affect DIRECTV? Most importantly, this change
         has absolutely no impact on DIRECTV's past or future revenues, EBITDA
         or cash flow. The key change is that from a historical perspective, our
         cumulative subscriber base has been reduced by the approximately
         360,000 subscribers that have been classified as pending. And since
         ARPU is calculated by dividing total revenue by DIRECTV owned and
         operated subscribers, our ARPU will increase, on average by about two
         dollars as a result of this change.

         Churn will also increase by approximately 6/100ths of one point per
         month. For example, churn in the quarter would have been 1.54% vs. our
         reported 1.6%. This policy change is consistent with my goals of the
         last nine months to update or change operations, procedures and
         policies that no longer make sense. As you know, during this time our
         team has made many operational changes that have significantly improved
         our financial performance. We've also made many procedural changes to
         simplify our business while also providing more clarity and
         transparency. That's what we're hoping to accomplish with this change.

         And one final point before moving on. A couple of weeks ago, Pegasus
         reported that they had removed from their subscriber base approximately
         120,000 customers who's service had been suspended for prolonged
         periods of time. Since Pegasus does not share specific subscriber data
         with us, we're not sure what kind of subscribers or customers they
         removed. However, for consistency, we did remove these 120,000
         customers from our historical subscriber base in the first quarter.


         Now let's move on to revenues. For the first quarter, DIRECTV's revenue
         of nearly $1.5 billion beat expectations. This strong performance was
         due primarily to higher than expected net subscriber additions coupled
         with better than expected ARPU, mainly from our higher local channel
         penetration rate I talked about earlier.

         ARPU was $56.70 for the quarter vs. $58.50 last year. Those ARPU
         numbers are calculated on the same basis, that is, excluding the
         pending subscribers from the denominator for each period. Although ARPU
         in the quarter was better than our expectations, it was lower than last
         year mostly due to the lower premium package revenue and fewer
         pay-per-view purchases, a trend that we've seen over the last 12
         months. Our new simplified program packaging strategy was put into
         place in February specifically to address this trend in ARPU and the
         early results of the strategy are both positive and consistent with our

         More importantly, for the year, mostly as a result of the higher net
         subscriber adds and slightly better than planned ARPU, we're increasing
         our revenue guidance to $6.2 billion compared to our previous guidance
         of $6 to $6.2 billion. ARPU for the full year is expected to be
         approximately $57 to $58 per month.

         Consistent with our guidance, Subscriber Acquisition Costs - or SAC-
         was $520 per gross subscriber addition during the quarter. The
         improvement in the first quarter compared to the $560 level we ran
         during the second half of last year was due primarily to the
         elimination of the box subsidy we'd been paying to manufacturers of
         DIRECTV equipment and lower non-activations as a result of our new
         activation policy at retail.

         Compensation to our retail partners, which comprises the largest
         component of our SAC, continues to be tied to their ability to secure a
         commitment from the customer to activate and retain the DIRECTV service
         for a minimum of one year. This clearly appears to be having the
         desired impact as approximately 90% of the new customers who are
         signing up for DIRECTV are committing to the year of service. For the


         full year, we're confident that we can maintain our SAC at the prior
         guidance of approximately $525.

         Pre-marketing cash flow was 39% of revenue for the quarter. For this
         year, we continue to believe that pre-marketing cash flow will remain
         at this level or slightly higher.

         One of the highlights of the quarter was an important sign that we're
         doing things right at DIRECTV. That is, the $85 million of EBITDA we
         attained in the quarter. While this result fell within our guidance
         range of $80 to $100 million, our EBITDA performance was significantly
         better than expected given our substantial over performance in
         subscriber additions.

         Driving the better than expected EBITDA results were a combination of
         operational improvements, the most significant of which included the
         margin derived from the slightly higher than planned ARPU we discussed
         earlier, and lower expenses resulting from our continued focus on
         managing our costs.

         We expect to continue seeing EBITDA improvements during the course of
         the year. As a result of the strong performance, we believe that we can
         achieve the low end of our prior EBITDA guidance of approximately $525
         million even though we're increasing our full-year net subscriber
         guidance by 200,000.

         In summary, I'm really pleased with the progress we're making this
         quarter in getting the DIRECTV business back on track. And since it's
         springtime and a new Yankee season is now upon us, today I see DIRECTV
         as being in the early innings of a nine-inning turnaround story. While
         we're doing some good work, there's so much left to accomplish. So with
         that, I'm going to turn the call over to Kevin McGrath who will provide
         an update on DIRECTV Latin America, Kevin?

Kevin McGrath: Thanks, Roxanne. The DIRECTV Latin America or DLA subscriber
         base grew by 32,000 in the first quarter. The increase, while modest,
         demonstrates our ability to continue to grow the business while dealing


         with the economic crisis in Argentina. The Argentina devaluation
         affects not only subscribers, but also revenues and EBITDA, as I will
         discuss further.

         The first quarter revenue was $165 million. This is unchanged from the
         first quarter of 2001, because the increased revenue generated from a
         larger subscriber base was primarily offset by the effects of the
         devaluation in Argentina. First quarter EBITDA was a negative $61
         million including a negative impact of $32 million due to the Argentina

         As we discussed with you in January, the volatility in Argentina
         presents us with great challenges. Excluding the effect of the
         devaluation in Argentina, DLA has improved its EBITDA approximately 34%
         compared to the first quarter of last year.

         Now as you may recall, churn is cyclical and historically, DIRECTV
         Latin America had by far its highest rate of churn in the first quarter
         of each year. We expect the same to be so in 2002. First quarter churn
         of 3.2% was slightly higher than we planned but it's a substantial
         improvement over the 3.8% rate during the same period last year. This
         improvement is significant considering the Argentina currency
         devaluation and the political turmoil in Venezuela.

         To reduce the financial impact of churning subscribers, we continue to
         utilize a selective subscriber acquisition process and are still
         confident that we will reach our full year average of 2.5% monthly

         When I spoke to you in January, the Argentina Exchange rate was 1.7
         pesos per US dollar. At that time we estimated that such an exchange
         rate would result in an $80 million loss in revenue and a $50 million
         decline in EBITDA from our prior forecast. Today the rate is
         approximately 2.9 pesos per US dollar and most forecasters expect the
         rate to increase throughout the year.

         This dramatic change in the exchange rate significantly affects our
         revenue and EBITDA in Argentina. We are now project a revenue loss of
         approximately $135 million and an EBITDA loss of $95 million as a
         result of the Argentina devaluation. These estimates are based on
         projections for year-end rate of exchange of just under 5 pesos to the


         dollar. We will continue our aggressive efforts to increase prices,
         re-negotiate programming contracts, and further reduce SG&A in order to
         mitigate the losses as the year progresses.

         As a result, full year revenues are now forecast to be $800 to $850
         million. Compared to our prior forecast of EBITDA, breakeven excluding
         the devaluation, we are now forecasting a full yearEBITDA loss of
         approximately $100 million. Virtually all of the decline is due to the
         Argentine devaluation.

         Our second quarter revenues are forecast to be $225 to $250 million
         including the impact of the World Cup and the Argentine devaluation. We
         are forecasting a second quarter EBITDA loss of approximately $95
         million due primarily to the planned expenses relating to World Cup as
         well as a $35 million devaluation impact.

         World cup contracts have been signed with TV Azteca, PCTV, CNI Canal 40
         and Multimedios/Minenio in Mexico and Canal 2 America, and Canal 7 in

         While we recognize that the current economic crisis in Argentina
         represents a significant challenge to our operating performance, we
         will continue to monitor the economic environment in Argentina and
         throughout the region and mitigate the impact where possible. With
         that, I'll turn the call over to Pradman Kaul for an update on HNS,

Pradman Kaul: Thanks, Kevin. HNS generated first quarter 2002 revenues of $243
         million down 2% from sales in the first quarter of 2001 but at the
         high-end of our guidance. As expected, continued growth in the
         satellite broadband segment and strong shipments of DIRECTV receiver
         systems were offset by a significant decline in the carrier segment.

         Sales to domestic broadband customers grew by 18% compared with prior
         year, while global satellite broadband revenues increased by 8%. During
         this quarter, HNS booked contracts with important new customers such as


         American Towers, where we are helping to improve communications with
         its geographically dispersed sites.

         In addition, we also booked orders for:

         Chrysler where we will provide broadband upgrades at over 4,500
         dealerships throughout North America.

         With Smart, one of DaimlerChrysler's other five car brands in Europe,
         where we will provide broadband services at approximately 200 European
         dealerships. Union Fenosa, the third largest Power Company in Spain for
         whom we will install a VSAT Network that spans Spain and Latin America.
         Nl Tree through which we will provide broadband Internet access to
         roughly 800 schools initially in the Netherlands. Damon's Restaurant,
         where for the first time we're teaming with an application service
         provider and asked to provide differentiated service to the restaurant
         industry. And Best Western International, where we will provide
         broadband functionality to all Best Western Hotels in the US. When
         commenting on this contract award, Best Western noted the consistent,
         high quality, ubiquitous service provided by DIRECWAY.

         The number of consumer and small office/home office directory
         subscribers expanded nearly 10% through the quarter to over 111,000.
         This subscriber base has grown 79% over the past year. We conducted
         limited direct mail promotions of the DIRECWAY Internet Access Service
         through DIRECTV's customers during this quarter, and were encouraged by
         the initial response. Moreover, we experimented with marketing programs
         that spread the up-front cost to a year and again were encouraged by
         the results. For these reasons, we are reiterating our earlier guidance
         of servicing two to three hundred thousand DIRECWAY subscribers by year
         end. At this point, though, we expect results at the low end of that

         HNS continued to demonstrate its strength in the Set Top Box market,
         having shipped 430,000 DIRECTV units in the first quarter of 2002, a
         dramatic increase compared to the 252,000 units shipped during the
         first quarter of 2001. We continued to meet the needs of DIRECTV's
         growing subscriber base. As a result, first quarter revenues in our set
         top segment grew by 33% compared to prior year.


         Growth in the Satellite Broadband and Set Top Segments were offset by a
         significant reduction in the Carrier segment. As we mentioned when
         originally providing guidance for the year, comparatives for this
         segment are expected to be negative throughout the year, primarily due
         to substantial completion of large projects for XM Satellite Radio and
         Thuraya Satellite Telecommunications Company. The business of this
         segment is opportunistic and project driven and the softness in the
         Telecomm Carrier Segment is impacting it in a major way.

         HNS is operating EBITDA improved $11 million compared to the first
         quarter of last year and this does not include a one-time charge of $6
         million associated with a workforce reduction.

         Looking forward to the second quarter, we expect performance that
         largely resembles what we've experienced up to this point in the year.
         Growth in the Satellite Broadband and Set Top Segments should continue
         but be offset by negative comparisons for the carrier segment. We
         expect EBITDA to improve vs. prior year but will remain negative due to
         investments in the Consumer Directory and SPACEWAY businesses.

         Moreover, we are reiterating our full-year guidance of $1.3 to $1.4
         billion in revenues and EBITDA of negative $50 to $70 million. Speaking
         of SPACEWAY, I'd like to take a minute to update you on the status of
         that important program. Progress continues on numerous fronts.
         Satellite construction is well underway with launch scheduled for July
         2003. This will lead to commencement of commercial service in early
         2004. Development of the ground segment and terminals continues as

         You may recall that we formed the HUGHES Broadband Alliance during 2001
         to encourage leading corporations to develop applications that take
         advantage of SPACEWAY's superior functionality. The systems unique and
         broad appeal is evidenced by the fact that we've received indications
         of interest from all 500 companies and are actively pursuing more than
         200 of them.

         Both Hewlett Packard and Sun MicroSystems with their strategic emphasis
         on peer-to-peer computing and corporate networks, along with EMC and
         Polycom are now members. We remain as committed as ever to SPACEWAY and


         continue to be excited about its prospects. With that, I'll turn the
         call back to Jon Rubin, Jon?

Jon Rubin: Thanks Pradman. Now let's move on to questions you may have
         about HUGHES' First Quarter Results. Keep in mind that we have members
         of the media on this call in a "listen only" mode. I'd like to remind
         the media that they are not authorized to quote any participants on
         this call either directly or in substance, other than the
         representatives of HUGHES. In addition, we are webcasting this call
         live on the Internet and an archived copy will be kept on our site.

         Finally, I'd like to ask callers to limit your questions to only one or
         two until everyone has had a chance to ask questions. At that point,
         feel free to ask additional questions. Operator? We're ready for the
         first question.

Operator: Thank you. Today's question and answer session will be conducted
         electronically. In order to pose a question, please press the star key
         followed by the digit 1 on your touch tone telephone. Once again, if
         you would like to ask a question, please press the star key followed by
         the digit 1. We'll go first to Karim Zia of Deutsche Bank.

Karim Zia: Thanks, for Roxanne I guess I have two questions. On the
         composition of growth, the statistic you mentioned of 70% penetration
         on local, is that of just - of subscribers coming into those - into the
         top 41 markets that 70% are taking? Or is that of the total gross

Roxanne Austin: No, 70% of those markets, Karim, as you've said are taking
         local in the 41.

Karim:   And what would that percentage be as a percentage of total gross adds?

Roxanne Austin: Well, I don't know them off the top of my head. Probably 50
         roughly but maybe as high as 60, so somewhere between 50 and 60.


Karim Zia: Okay, of new subscribers that are coming from the top 41 markets?

Roxanne Austin: No, in the top 41 markets, 70% are taking local channels, okay?

Karim Zia: Okay.

Roxanne Austin: In overall, on a blended basis, all customers in that market if
         you talking about historical, I mean that's if I understood your
         question. You're talking about a blended customer average, existing
         customers and new customers or roughly 61%.

Karim Zia: Okay, my question then was, of total gross additions?

Roxanne Austin: Of total gross additions for the whole market, I would say it's
         roughly 50 to 60%.

Karim Zia: Okay, thanks. And then on the ARPU, could you distinguish when you
         say the pay-per-view and premium impact. Is that on existing
         subscribers or more on incremental subscribers? Or I guess could you
         say what incremental subscriber ARPU is?

Roxanne Austin: It's actually both, Karim. It's on both. We saw a trend last
         year that I talked about in the last quarter of last year of declining
         ARPU, primarily due to penetration rates and due to pay-per-view
         purchases. If you look at what we've done to turn that around, it was
         the implementation of the new package simplification that we put in
         place on February 1st. And that was put in place for two reasons, not
         only for existing subscribers, which we believe will have a higher ARPU
         out of existing subscribers, but also for new subscribers to actually
         lead with our Total Choice Plus with Local for $39.99 package.

         If you see most of our ads today, they're all focused on that as our
         lead ad. Because we want to actually have people come into the service.
         We've actually eliminated a service called Select Choice at activation.
         That was our lowest priced package.


         Today the lowest priced package is Total Choice. People can no longer
         activate into Select Choice. And for those customers that we've
         grandfathered into Select Choice, allowed them to keep it - the
         customers who had it prior to the change, we've had to implement a
         price increase in that particular package.

Karim Zia: Okay, and then going forward, what would your expectation be for
         ARPU? I know you mentioned the full year, but sort-of thereafter, do
         you expect this to kind of shake through and then ARPU begin to
         increase again over time?

Roxanne Austin: Well, again I think the $57 to $58 dollar range is fairly
         significant. I don't think you will see it in the core packages and
         core programming that we have where you'll see ARPU increases in the
         future will come from Interactive and other types of revenues,
         advertising and other things.

Karim Zia: Okay, thanks.

Roxanne Austin: Thanks.

Operator: We'll go next to Vijay Jayant from Morgan Stanley.

Vijay Jayant: A question on - can you give us an update on the Boeing

Michael Gaines: Sure, this is Mike Gaines. There really hasn't been a lot of
         new information. We continue in the process ((inaudible)) to try to
         resolve our differences but at this point I'd say from a quarter ago,
         not really much has changed.

Vijay Jayant: Roxanne, does the SAC numbers that you released in your press
         release exclude advanced and leased set top boxes? If you included
         them, what would that number look like?

Roxanne Austin: Roughly about $15 higher.


Vijay Jayant: Great and one final question, for Pradman. How many two-way
         subscribers are there on the DIRECWAY platform right now?

Pradman Kaul: Out of the 111,000 I think roughly 70,000 are about two-way right

Vijay Jayant: Great, congratulations.

Pradman Kaul: Thank you.

Operator: We'll go next to Ty Carmichael of CS First Boston.

Ty Carmichael: Hi, just wanted to work through the numbers a little bit as
         it relates to your churn and your pre-marketing cash flow calculations.
         If you assume the pre-market and cash flow is 39% of your top-line
         revenues, you get to about $571 million which would imply then that if
         you take your $85 million reported EBITDA of about $487 million of
         additional costs. Is that just subscriber acquisition costs or what's
         in that number in terms of your definition?

Mike Palkovic: Hi, it's Mike Palkovic. That number is comprised of SAC as we
         described it at 525 plus the category we referred to as non-SAC which
         is largely retention marketing. Those two numbers comprise that

Ty Carmichael: So the retention marketing, what would that be for that for
         an absolute dollar amount?

Mike Palkovic: I'm sorry, which category?

Ty Carmichael: The retention marketing.

Mike Palkovic: That category ranges between $70 and $80 million a quarter.


Ty Carmichael: Okay. And then additionally as it relates to the plan to
         disconnect - or the card swap out. Just wanted you to know, more
         comments on your plans to move that technology internal and stop
         working with NDS if you could just explain the logic behind that?

Roxanne Austin: Well, I think, Ty, we wanted to have greater control over one
         of the key elements of security on our system, which is our conditional

Ty Carmichael: Okay.

Roxanne Austin: We had significant talent within the DIRECTV organization with
         respect to conditional access. We think we can better control our
         Conditional Access Systems by managing it ourselves. It was with a
         great deal of thought that we made that decision and we're looking
         forward to getting it implemented.

Ty Carmichael: Okay, and if it's successfully implemented, it would -
         given the reduction in piracy, what would we - when and what could we
         expect in terms of the impact on DIRECTV numbers? Could churn go down
         even further from the 1.6% down to - what's the order of impact on both
         churn and net subscriber additions?

Roxanne Austin: Of course, Ty, the purpose of doing this is to try to reduce
         piracy ((inaudible)) to reduce piracy. I think we've made a lot of good
         progress on the piracy front but we certainly see additional
         opportunities to reduce piracy by controlling the conditional access
         system internally.

         We do believe we can continue to see improvements in churn. As I've
         said before, I mean I think we're not stopping at 1.6 and this is
         certainly one other element of the - of our war on churn and piracy. So
         we're continuing to focus on something that can get us down in that 1.5
         or lower range.

Ty Carmichael: Okay, and then last, you just said $80 million in retention
         marketing. Is that per quarter, Mike?


Roxanne Austin: That's roughly per quarter.

Ty Carmichael: Okay, thank you very much.

Roxanne Austin: Thanks, Ty.

Man: Thanks, Ty.

Operator: We'll go next to Marc Nabi of Merrill Lynch.

Marc Nabi: Hey, everyone, how are you doing?

Man: Good, Marc.

Marc Nabi: One question to start off with relates to ((inaudible)) make a
         comment about the Yankees and I guess the whole Yes Network what I'll
         call the "saga" between Cablevision and YES Network. Just out of
         curiosity, there were comments and I guess Skyreport talking about that
         you saw a 20% increase in your gross additions in the region. What
         percent of your subscribers come from, say, even the Northeast - your
         gross adds?

Roxanne Austin: Boy, I don't have that number off the top of my head, Marc to
         be honest with you. What I will tell you is that if you just look to
         the New York DMA, of course with all of the significant press that we
         got out of the dispute between Cablevision and YES, you saw a rise in
         awareness in the entire market. And I think for people who were not
         even Yankee fans, they now have one other reason why DIRECTV is good
         over perhaps a cable alternative.

         It raised awareness in the entire market and I think we benefited from
         that. Whether or not the individual is or is not a Yankee fan, which of


         course as many people in the region are of course Yankee fans. But even
         those who weren't we think would have benefited from that. We had
         tremendous press and I know you're aware in the marketplace both in the
         print media, on television, in radio that we - you couldn't pay for. I
         mean it was significant exposure.

Marc Nabi: And, Roxanne, would you say though - I'm just trying to - if I
         said 100,000 new customers came from that region because of, you know
         the satisfaction.

Roxanne Austin: You'd be way off.

Marc Nabi: Okay that's why I just wanted to make sure of the order of

Roxanne Austin: You'd be too high. I think again, I think we saw a raise in
         awareness. We're seeing significant increases in all of our large
         markets as I said in my opening remarks, Marc. And in some cases, over
         50% and I think that you see that in big markets like LA and New York
         and Chicago. They're all up over 50%.

Marc Nabi: Okay. Other question relates to pending. I just want to make sure
         I understand something. The way I viewed pending, if you go back to
         what happened in August or let's say the second - third quarter of last
         year when, we'll say piracy was actually at its height, the highest
         level in our view, right? What percent of those customers, those
         pending customers would you say were actually becoming DIRECTV
         customers vs. they were being pirated, you know they were just taking
         the service?

Roxanne Austin: Well, there certainly could have been a portion of those. I
         mean there would be a number of reasons, Ty, why someone never became
         an active subscriber who was ultimately pending. Obviously with the
         (inaudible) majority, those ultimately did. But we had a policy that we
         would turn off any subscriber that was pending - all the information
         was in our billing system for them to be a subscriber but they didn't
         become one after 100 days for any reason. They were no longer counted
         in the subscriber base. And as you saw in our press release, the data
         that we included in that last page of the press release.


Marc Nabi: Yes.

Roxanne Austin: That number's been relatively flat over the period of time, so
         I mean there could have been some number of those that did not ever
         connect because of piracy but again anyone was disconnected who did not
         - was pending but did not become active within 100 days.

Marc Nabi: So, to clarify for me, when you say like for example at the end
         of the year there were approximately 360,000 customers in the fourth
         quarter, would you say about 90% of those became DIRECTV customers? I
         mean is there - I wouldn't say a very high number.

Roxanne Austin: I'd say a very high number.

Marc Nabi: Okay, the other question relates to, I guess either Ty or Vijay
         whoever was asking, with respect to the conditional access. What is the
         expected cost? And is it going to occur at the end of '02 or is going
         to be expected after August of '03? I'm just trying to figure out when
         an incremental cost will occur.

Mike Palkovic: Marc, it's Mike Palkovic. We have provided in our plan
         approximately $150 million for both the cost of the card and the
         delivery of those cards during - in this year.

Marc Nabi: So, embedded in your $525 EBITDA estimate is $150 additional cost
         that you would normally not have had related to conditional access?

Mike Palkovic: No, Marc, that number is not in our SAC, we have that.

Marc Nabi: No, not SAC - total EBITDA.

Mike Palkovic: Sorry, it's not in our EBITDA. It's included in our Capex


Marc Nabi: Oh, so you're going to capitalize it?

Mike Palkovic: That's correct.

Marc Nabi: Okay, very well.  Well thank you very much.

Mike Palkovic: Thank you, Marc.

Operator: And we'll go next to William Kidd of Lehman Brothers.

William Kidd: I'm not ((inaudible)) this is Roxanne for you, but could you
         comment on what's going on specifically in terms of your strong growth
         vs. what's going on with the NRTC broadly. And is that - is there a
         sector trend? Is it NRTC trend and just why is the growth so different?

Roxanne Austin: Well, William, I don't want to comment on NRTC, obviously you
         need to talk to them about their strategies. I've got one job and
         that's the focus of ((inaudible)) DIRECTV US owned and operated subs
         and that's what we're focused on. But I think you can see with the
         inability I would only speculate that you see the inability to reach
         agreement with retailers such as Radio Shack on compensation as an
         example of probably one of the reasons. I mean, I think you've got to
         ask them.

William Kidd: At the same time, Roxanne you alluded to the fact that in the 41
         markets here you have local service that you're growth is better than
         in other areas.

Roxanne Austin: Absolutely.

William Kidd: And so, I guess can you give us some characterization of what
         rural America looks like today from your perspective in terms of - are
         you seeing growth there? Is it bigger than this 20% differential? Is
         that your worst market today? And if that's not your worst market,
         what's your worst demographic?


Roxanne Austin: Well, I think we certainly have significant penetration in
         rural America between, you know, all the satellite providers in the
         marketplace. I think it's clear that growth for us will come in those
         markets where we have a full cable alternative layout. And today,
         that's our 41 markets going to 51 before the end of the year and, of
         course, DIRECTV has the added advantage of the single dish to be able
         to provide all the local channels in the 41 markets.

         So, as I look at that, it's clear to me that having a full cable
         replacement is what's driving our growth. And we do not see that growth
         in areas where we don't have a full cable replacement. So, it's
         critically important to do what we did by launching and meeting our
         must-carry obligations, having a single digital alternative and then
         launching the additional 51 markets.

Jack Shaw: One thing, William that is kind of interesting to me, you know we
         have made the case that the merger and the combination of the spectrum
         and the doing away with the duplicate channels and so forth will allow
         us to go to all - and another satellite - will allow us to go to all
         210 markets. And I think some of the data that DIRECTV and Roxanne has
         given to you folks today, I saw for the first time yesterday. And I
         think it is really pretty much proven the point that when we can put a
         package together that competes with cables full package, we can go
         toe-to-toe with them. When we don't, we're not nearly as robust in
         competing against them.

William Kidd: Okay, and with respect to I guess Pegasus, I guess I had always
         thought that this was going to be likely resolved by litigation. But
         with the whole Radio Shack issue, it seems like DIRECTV is getting
         collateral damage from the whole relationship with Pegasus. And it
         seems to me that there's a certain number of subs that you would lose
         were it no longer makes sense to continue to dispute this.

         And, you know I've never been a big proponent of buy-out but you don't
         have to lose that many subs for Pegasus to become plausible in terms of
         resolving that through acquisition. And, I guess how is the Radio Shack
         situation, in other words changed your perspective of Pegasus, if at
         all? And do you still expect this will likely resolved by court some
         time either later this year or early next year?


Roxanne Austin: Well, it hasn't changed our position with respect to NRTC
         Pegasus. Certainly Radio Shack, as you know was an exception, not the
         rule. It certainly was a large CE retailer who has significant
         penetration because of their store demographics and NRTC territory. So,
         they had about 25% of their total sales were in NRTC territories.

         So I would say they are an exception. We're ((inaudible)). We're
         continuing to focus on our business and growing our business and that's
         what we're going to continue to do for the rest of the year with
         respect to the litigation, again the timing hasn't changed.

William Kidd: I appreciate it and congratulations on the strong result.

Roxanne Austin: Thank you.

Jack Shaw: Thank you very much, William.

Operator: We'll go next to John Stone of Ladenburg Thalmann.

John Stone: Congratulations on a good quarter. My first question is related
         to the DIRECTV DSL offering. At what level of subscribers do you guys
         project that we can get this to break-even?

Roxanne Austin: Well, it's going to take a while, with all honesty, to get to
         break-even, John. I mean this is a business that today, the economics
         are very tough for us. Because our subscriber acquisition costs,
         looking at the access costs, what it costs us in this business, it is
         difficult to see a break-even point in the next couple of years in that
         business, quite frankly. And it's something that we're focused on very
         heavily because it's costing us a lot of money today and we do not see
         the kind of critical mass yet that we need to be able to see


John Stone: I really - I'm not interested in so much as when it might
         happen, but in just what it would take in terms of subs. Can you give
         me any kind of a ballpark for that?

Roxanne Austin: Well I think the honest answer is, it depends on what happens
         in the regulatory environment and whether or not the access costs
         continue to be as high as they are today. If they're as high as they
         are today, I mean you've got to have numbers that are, you know, well
         north of a million subscribers to get there.

John Stone: Okay, what sort of overlap to you guys see between the DIRECTV
         Broadband and the DIRECTV Video customer bases?

Roxanne Austin: We're seeing roughly about 30% or so are also DIRECTV customers
         today in the DIRECTV DSL offerings.

Jack Shaw: In the DIRECTV - excuse me in the Broadband offering, satellite
         based Broadband offering I think Pradman is at 50% of your two-way
         customers are also DIRECTV customers.

Pradman Kaul: Right, I mean both two-way and one-way. A lot of the one-way guys
         initially (inaudible) DIRECTV customers.

Jack Shaw: So there's quite a high correlation.

John Stone: Okay, great and then of course that's getting to really what you
         were saying just a few moments ago, Jack. You were saying that to be
         competitive with cable, you really have to be able to have a full
         package that goes up against them.

         Of course, the ultimate cable package is voice, video and data and
         through DIRECTV DSL and you recently mentioned that you were going to
         be putting voice over IP equipment into the DSL gateways, and with your
         existing satellite video offering it would seem that, at least from a


         customer perspective, if you can get it all to work and the economics
         to work, that you might have a full package as well in that sense.

         To what extent - when do you think this is going to, you know looking
         out a little ways, what do you think it's going to take to get to the
         point that you can have a full package to go up against cable and
         perhaps start to narrow the gap between what cable customers are valued
         for, you know north of 4,000 - sometimes north of 5,000 and where your
         customers are well, south of 2,000 each?

Jack Shaw: I don't know that I can answer those questions. Concerning voice
         and the offering of voice by HUGHES in whatever framework, I think
         we're a ways away from doing that. But concerning our valuation,
         concerning cable, I mean obviously we always thought that we have been
         valued not quite properly relative to cable. And as we get closer to
         their offering and take more and more customers away from them, maybe
         people will see that our valuation should be closer to theirs. But
         that's kind of speculation on our part.

John Stone: Thank you very much and again, congratulations on the quarter.

Jack Shaw: Thank you.

Roxanne Austin: Thank you.

Operator: We'll go next to Ray Schleinkofer of Thomas Weisel Partners.

Ray Schleinkofer: Yes, congratulations on a nice quarter. Just a quick
         question, with churn coming down. A lot of that probably relates to
         subscribers coming in who are part of a twelve month commitment that
         you - that program that you put in place sometime last year. I was just
         wondering, do you have any statistics on what percentage of your
         subscriber base has now sort of migrated into one of those programs
         that can keep subscribers in place?


Roxanne Austin: Well, we started the annual commitment requirement in October
         of 2001. So we had roughly a couple of months - actually about, yes a
         couple of months in 2001 and then the full quarter this year. So a
         significant portion of the growth adds in Q4 and then virtually all of
         the growth adds in Q1 came in under the Annual Commitment Offer.

         So while you're seeing the impact of it, you certainly haven't seen the
         full impact of it yet because you won't see the full impact until, of
         course, it's been implemented for a full 12 month period.

Ray Schleinkofer: Okay, that's great and then just sort of on a bigger
         picture question. It seems like the majority of your subs - your sub
         adds are coming in from the major markets and those are areas where
         presumably digital cable has already been rolled out. Are you seeing -
         is it tougher to get in to some of those places with digital cable?
         Does digital cable make any type of a difference as you look across the
         board trying to pick up subscribers? Or does it really not matter?

Roxanne Austin: Well, obviously digital cable is the competition, right?

Ray Schleinkofer: Right.

Roxanne Austin: So the way we've promoted and packaged our product has been
         directly aimed at the cable competition. If you look at our Total
         Choice Plus with Local Channels, the package that we lead with, and all
         of our advertising and marketing, the $39.99 package. At 130 channels
         with all the local channels plus all the additional offerings that we
         have in all digital formats, that is a killer package against any
         digital competitor in terms of the digital market.

         We think we have - continue to have, you know better quality, better
         value. Many of those channels that they carry if you buy the digital
         tier you're still getting a significant number of channels in the
         analog format. They just can't compare to an all digital - fully cable
         competitive with all digital channels example.


         So, again, it's why Jack said earlier that it's so important that we
         have local channels to be able to compete. And when we compete with all
         of our guns, we're darn good competitors.

Ray Schleinkofer:That's great, thanks guys.

Roxanne Austin: Thanks.

Jack Shaw: Thank you.

Operator: We'll go next to Armand Musey of Salomon Smith Barney.

Armand Musey: Good afternoon, guys and congratulations on a pretty solid

Roxanne Austin: Thanks, Armand.

Armand Musey: A couple of questions. First of all, obviously you're taking up
         guidance a little bit on the subscriber numbers and you're also
         indicating that loss is going to be a little higher in GLA, but you're
         EBITDA number's going to be the same. Give us a little bit of an idea
         where those - where you're wringing out the cost savings there.

Mike Gaines: I think what you're seeing Armand is that taking our EBITDA
         guidance at DIRECTV Latin America you know, to a loss of $100 million.
         I think all of our businesses have held solid and I think that allows
         us to stay within the range, the top level for the company. I don't
         know if that answered your question or not.

Armand Musey: Well, it seems that if you're adding more subscribers, you're
         obviously should have little higher subscriber acquisition costs and at
         the same time you have, you know a little ((inaudible)) losses in GLA
         but your consolidate EBITDA is still coming in kind of where your
         guidance was.


Roxanne Austin: We actually have improved, if you're talking about DIRECTV US
         ((inaudible)) and then I'll let Mike comment on the HUGHES level, but
         the DIRECTV US only, we continued our focus on cost-cutting. So as I
         said in my opening remarks, the additional subscribers that we're
         bringing on, the added margin from them and our cost-cutting are
         allowing us to offset the additional costs that we're incurring for
         those additional subscribers.

         So the combination of those, you know the improved revenue and margin
         coming from the additional subs, plus our additional cost-cutting
         efforts have more than offset the costs that we're seeing for
         subscriber acquisitions so that extra 200,000 ((inaudible)).

Armand Musey: Yeah, as you said ((inaudible)) put a little more color into
         when you say "cost cutting". Exactly where is that coming from?

Roxanne Austin: It's really out of our G&A.

Armand Musey: Okay.

Roxanne Austin: That's where we've cut it.

Jack Shaw: We, as you know Armand. This is Jack. As you know, probably nine,
         ten months ago we really started a concerted effort to kind of
         restructure our costs at all of the HUGHES companies. And you know it
         really wasn't just talk on our part, we really felt we had to have it.
         So we did some real stuff. And it's starting to come through and you
         know that's a positive.

         But I think the biggest positive to me is that I think we have only
         just begun. I think there's more to come.

Armand Musey: Okay, any color on sort of what that real stuff is? Are you
         handling calls more efficiently? Is it lower salaries? Is it just lower
         head count?


Mike Gaines: Armand, Hi.  It's Mike.  Yeah most of the ((inaudible)).

Armand Musey: Is there one item that really sticks out where you've gotten it
         or is it a lot of little things?

Mike Palkovic: Well, a lot of it came with a reduction in force last year.
         That floats through this year and we're getting the savings from that.
         And it's also across the board not growing our costs year-to-year but
         rather holding a flat year-to-year which has a significant value in
         terms of driving more of the, you know, volume related margin to the
         bottom line.

         On the customer sat side, we're actually making some investments in
         that area to make sure that we provide the kind of service that can
         support, you know the churn reductions that we've had. That's an area
         we're actually spending a little money in.

Armand Musey: Okay, final question - it relates to direct sales. Can you talk
         about any efforts, or the development of the direct sales efforts? You
         know, obviously EchoStar is putting a fair amount of emphasis there and
         Pegasus has put in enormous emphasis there. Talk a little bit about
         what kind of progress you've made there or how you see that - your
         strategy in that area?

Roxanne Austin: Yeah, as we've said earlier, you know we see roughly about you
         know roughly about 10% or just under of our total growth adds this year
         will come from direct sales. We continue to see that be the case. We
         can see - we can drive additional customers using the direct sales
         channel and we'll continue to do that.

Armand Musey: How much difference is the SAC when direct - between direct and
         going through dealers - ballpark?

Jack Shaw: Armand, if you keep the direct sales at the level of
         ((inaudible)), it's a very efficient cost per sale, because it drafts
         heavily off of our, you know, mass market advertising. To drive it


         significantly beyond that, you start driving the SAC up. So we're being
         a little bit careful not pushing it too hard and causing a higher SAC
         than our major market.

Roxanne Austin: We actually tried to look at the sweet spot, Armand where you
         can draft, as Mike said, off of the tagging that you're doing on
         national ads and not go out with, for example, mass mailings, a lot of
         targeted telemarketing types of activity. Because when you then - your
         hit rate on direct sales, you have to spend many many more dollars
         before you actually have a hit on a customer.

         As opposed to the customer through our tagging, roughly 10% just
         calling up and wanting service. That's a very efficient sale for us.
         When we start going beyond that, it becomes even more expensive than
         our retail channels, the way we've realigned our incentives.

Armand Musey: Okay, thank you very much and congratulations again.

Roxanne Austin: Thank you.

Jack Shaw: Thank you.

Operator: We'll go next to Bob Peck of Bear Stearns. Mr. Peck, your line is
         open. Please check your mute button.

         Hearing no response, we'll go to Mr. - we'll go to Robert Chapman of
         Chapman Capital.

Robert Chapman: ((inaudible)).  Hello?

Operator: Mr. Chapman, you're line is open.

Robert Chapman: I'm sorry about that, my question was asked, thank you.


Operator: We'll go next to Blaine Marder of Iridian Asset Management.

Blaine Marder: Two quick questions. If I add up the EBITDA losses of your
         businesses that are currently in the negative, and the Cap ex against
         those businesses, there's roughly, call it a billion dollars flowing
         out of the company this year. Can you just update us on progress to
         either kind of reduce those losses or pare back those businesses and
         reduce that billion dollars that's going out of the company? Thanks.

Mike Gaines: Well, I think you've got to put it into the individual buckets.
         On SPACEWAY, I mean, as we've talked about we are not attempting to
         pare that back in terms of stopping the program. We very much believe
         in the Spaceway platform, riding on the strength of our enterprise
         business. We're doing everything we can to limit the cash outflows but
         we are committed to going ahead.

         I think with respect to our broadband offerings, being DIRECWAY at
         Hughes Network Systems as well as DIRECTV DSL, we are committed to
         funding them this year, but I think in the context of, if there was no
         merger and we had to do it alone, we would evaluate where we stood and
         consider really, seriously if we would keep spending that money.

         So I think for now we are trying to limit the cash outflow in those
         businesses, but assuming there's a merger, I think that is a decision
         for the combined company and in the absent of one, we would seriously,
         you know reconsider those expenditures.

Blaine Marder: Okay, and next can you give me a sense of when the core
         DIRECTV US business will be self-funding? It looks like that's a
         possibility next year? Is that the case?

Roxanne Austin: It's actually Q4 of this year.

Blaine Marder: Q4 on a run rate basis?

Roxanne Austin: Yes.


Blaine Marder: Thanks a lot.

Roxanne Austin: Thank you.

Man: Thank you.

Operator: And we'll go next to Jeff Macke of Buckshot Capital.

Jeff Macke: Yeah, Hi guys. I have some questions. One just about your churn
         rate which I notice is reduced and how that dovetails with the rollout
         of PVR's both Ultimate and TiVo. The other question is pertaining to
         the Series II TiVo PVR unit that's rolling out some time in the fall.
         If you'd add any color for us in terms of numbers that you're looking
         for from that and just your general plans in terms of marketing.

Roxanne Austin: I would say, today the PVR functionality of TiVo and Ultimate
         hasn't added significantly to the reduction or churn rate. The numbers
         just aren't high enough in terms of penetration of those products to be
         able to have an impact today.

Jeff Macke: Do you have any numbers in terms of how the products, to the
         extent that they are penetrated are doing themselves?

Roxanne Austin: Because they are public companies we don't comment individually
         on what happens in their particular - but I can tell you it does not
         have a significant impact on reduction of churn. As it relates - you
         know we're excited about the new TiVo functionality coming out with the
         next generation in the fall.


         As you know, we've made an announcement that we are going to focus on
         the TiVo technology for DIRECTV in the US. And we're excited about that
         and our relationship will continue to evolve where we are ultimately in
         much greater control of our product offering in the US.

Jeff Macke: So are you going to refrain from any numbers or anything on
         those plans?

Roxanne Austin: Yes, I am, thank you.

Jeff Macke: Okay, no problem, thanks.

Jack Shaw: Thank you, Jeff.

Operator: And we have a follow up from Mark Nabi of Merrill Lynch.

Marc Nabi: Just one thing regarding the conditional access again. I'm just
         trying to see how, Roxanne, it coordinates with - if in fact the deal
         does occur, which you anticipate in the fourth quarter. How big of an
         issue is that going to be with respect to, you know, you're now about
         to go into this whole process of giving everyone new cards and spend
         about $150 million to do that. Have you guys discussed that with
         EchoStar at all?

Eddy Hartenstein: Marc, this is Eddy. We certainly have. Both satellite
         platform providers are on independent paths to upgrade there - are
         constantly look at upgrading their Conditional Access Systems.

         We have selected a way and as we've indicated with our SEC filings and
         data that we've given them that we would go to a dual-speak type of
         platform where both the EchoStar and the DIRECTV Conditional Access
         Systems are capable of speaking to boxes as we go forward.

         So, the - remember the transition to get everyone on a unified platform
         is on the order of three years. Starting from the close of the merger
         and you're going to - as you propagate new customers coming on


         post-close you would have a new system capable of going either way and
         you would have probably need all of the three years to make the
         complete transition, which is about, I think the expected life cycle of
         a next generation Conditional Access System.

         One thing that we have come to in common, and this has come about from
         the transition meetings is that there's two things that you want to
         have and control your own destiny on and one of them is the Conditional
         Access System, the second is the billing system, and that's one of the
         things that this merger will allow us to do in additional to doing all
         the good beneficial things of all the local markets and all the
         channels in all two hundred and ten DMAs.

Marc Nabi: Great, thanks a lot Eddy.

Eddy Hartenstein: Thanks, Marc.

Operator: And we'll go next to Vijay Jayant of Morgan Stanley.

Vijay Jayant: Yeah, two quick follow up questions. One on the YES Network.
         EchoStar and Cablevision are not carrying them. Can you sort of tell us
         why DIRECTV is carrying it in relation to the economics of that deal?

Roxanne Austin: We were the first distributor to sign up for the Yes Network.
         We got some - that was very favorable in terms of our ability to sign a
         deal. We don't comment specifically on the economics of a particular
         deal. But we think we were able to enjoy some favorable terms by being
         the first. And we certainly have enjoyed greater than we expected
         exposure for doing so.

         So, we looked at it, quite frankly, Vijay, on an analysis to say - how
         many subs would have to turn in our New York DMA to make this worth it
         for us? And, you know it doesn't have to be a very large number to make
         it - allow you to be able to carry the service.


Vijay Jayant: Great. On the financing and the cash burn, given the losses of
         the startup initiative. From what I understand on the merger agreement,
         that EchoStar has an obligation to, in effect buy PanAmSat within nine
         months after this closure - or after the - if the HUGHES merger is not
         permitted and it's not appealable at some point within nine months.

         Given the cash needs into '03 and given the cash that you have on your
         balance sheet right now and the cash burn that you see in these, you
         know ((inaudible)) and Spaceway and so forth. Can you walk us through
         what sources and uses of cash would be in the next year? Given also,
         you know the Boeing settlement at some time?

Mike Gaines: Sure. First let me comment. I think your comments about the
         timeframe for PanAmSat are a little bit longer. I believe that
         immediately upon a failure of regulatory approval, the process for them
         to buy - EchoStar to buy PanAmSat would commence. It would only depend
         upon regulatory approval of that deal which would not be expected to be
         nearly as length that you just described.

         In terms of our overall cash flow situation, our guidance for this year
         of approximately $1.6 billion in cash requirements. I think you saw
         from our release that we've put in place liquidity that's substantially
         above that. I think it's at least $500 million more than is required to
         get up through this year.

         And I would observe that, we really expect to be free cash flow - or
         break-even, basically, next year. So I think the financing hurdle would
         not be large at all. We would have maturity of our existing facilities
         at the end of this year, which we would attempt to roll over. Or, I
         think in an alternative we would go out and raise new debt this year to
         provide some of that future funding which we think is very doable.

Vijay Jayant: All right, thank you.

Mike Gaines: Thank you, Vijay.

Operator: We'll go next to Ty Carmichael at CS First Boston.


Ty Carmichael: I just wanted to follow up with regard to your lease plan
         and just ((inaudible)) provide some transparency to how the success of
         that and of that 10% direct sales ((inaudible)) total stems from the
         lease plan? And then how you see that playing out in the competitive
         landscape, you know, in Radio Shack say, for example where Echostar
         will have the lease plan and you'll have the purchase offer.

         You know, have you had any anecdotal evidence as to where the consumer
         activity gravitates when presented with both options?

Mike Palkovic: Hi, Ty. It's Mike. First of all, we're getting about 10% of
         the direct sales business is opting for the lease model. So it's a very
         small percentage. And our feeling is that right now with our offer in
         the marketplace being as competitive as it is both for a single room
         and a two-room solution. The two-room for example, where for $99 you
         can get two rooms, you know, installed for free.

         It's very competitive so, consumers are not choosing the lease option
         when we offer it to them. So that's kind of where we see it. So there's
         no reason right now for us to, you know jump heavily into that model
         based on the success we're having with our, kind of, our core offer.

Ty Carmichael: Okay, so of the direct sales, it's 100% stems from the
         lease plan?

Mike Palkovic: No, I'm sorry. It's 10% of the 10%. It's only about one
         percent of our gross. It's a very small number.

Ty Carmichael: Okay, all right.  Thank you very much.

Jack Shaw: Thanks, Ty.

Operator: We'll go next to John Stone of Ladenburg Thalmann.


John Stone: Hi, just a quick follow up - this would be for Kevin. In terms
         of the programming for DIRECTV Latin America, presumably some fraction
         of it is priced in local currencies and some fractions are programming
         as priced in dollars. Can you give me some insight in terms of what
         fraction of the programming for DIRECTV Latin America is priced in

Kevin McGrath: John, I would love to tell you the substantial portion is
         priced in local currency, but the majority I would say. I don't have a
         specific number but it's probably in the neighborhood of 80%. It's
         priced in US dollars. It's principally driven by US studios, and that's
         the only way they sell in this market to everyone. They sell to cable
         programmers, to Sky, (inaudible).

         And what you end up doing over the course of time is having, if you
         will, periodic renegotiation crisis as currency devalues, all of the
         program distributors come in and sit down with all the program
         providers and hassle through rate reductions. In fact, that's exactly
         what we're doing right now in Argentina.

         It is - it would make life a whole lot easier on all of us if they were
         priced on local currency, but the studios have yet to accept that.
         Everyone is in the same boat, frankly.

John Stone: Thanks, Kevin.

Kevin McGrath: Thank you, John.

Operator: Once again, if you have a question please press the star key followed
         by the digit 1. We'll go next to William Kidd of Lehman Brothers.

William Kidd: Just a quick follow up on DIRECTV Latin America. What is the
         service pricing strategy? Are you going to try and keep rates with
         inflation? Or just how are you going to try to maintain the pricing
         part of the service?


Kevin McGrath: Absolutely, William. We're pushing price very aggressively.
         And in most of the markets, we're the price leader. And we're the price
         leader because we have a better offering but also because we believe
         you just have to keep pushing prices in these markets to make the
         markets make sense over the course of time.

William Kidd: Can you, have you raised rates already in Argentina? And if so,
         can you describe by how much?

Man: We did. We raised prices- the industry raised prices on average 8% to
         10%. In the month of April, we raised prices approximately 14% in the
         month of April. I would expect we'll have additional price increases in
         the month of May, as you can expect with the devaluation, inflation has
         taken off a little bit and we're going to keep up with or exceed the
         inflation rate to cover the losses here.

William Kidd: I see, okay. And from a general modeling point of view, would you
         say it's fair to just keep it in line with local inflation or is that

Kevin McGrath: No, actually we absolutely have to keep it in line with local
         inflation or exceed it. And I would tell you, for example, we would
         price this also in Venezuela as the exchange moved there. And again, we
         were priced at there, in excess of 15%.

William Kidd: And with respect to the card swap out, is there a expected, is
         there a churn impact that anyone's anticipating and besides the cost,
         do you - is there going to be an uptake in your call centers or do you
         have any quantification of some of the potential ramifications?

Roxanne Austin: Based on our experience, we'd say that churn - we don't expect
         to see any effects significantly on churn. You will typically see and
         we've planned for some increases in call volume during the card change
         period. And this is the what - this is the second major? We've done it
         before, yes.

William Kidd: Great, thank you so much.


Roxanne Austin: Thank you.

Jack Shaw: Thank you, William.

Operator: At this time, there are no other questions in the queue. Mr. Rubin,
         I'll turn the conference back to you for any additional remarks.

Jon Rubin: I'd just like to thank everyone for joining us today. If you
         have any further questions, please contact me or our Investor Relations
         department at either HUGHES or PanAmSat. Thank you for your attention.
         Have a great afternoon.

Operator: That concludes today's conference call. We thank you for your
         participation. You may disconnect at this time.