Posted on 10/12/2017 12:38:04 PM PDT by jeannineinsd
AT&T will report heavy subscriber losses at DirecTV in its third-quarter earnings later this month, bleeding that the telco giant chalked up to heightened competition in the pay-TV arena and the wallop of the summer hurricane season.
In a Securities and Exchange Commission filing late Wednesday, AT&T said it would post a net loss of 90,000 traditional video subscribers for the quarter, offset by the addition of nearly 300,000 subscribers to its DirecTV Now streaming service. AT&T reports its third-quarter earnings on Oct. 24.
As MoffettNathanson analyst Craig Moffett observed, the net loss means DirecTV is losing about 390,000 traditional subscribers — customers that had been paying at a higher rate than the low-cost DirecTV Now service. Moffett chalked it up to consumers moving away from the traditional big pay-TV bundle.
“It should be clear that DirecTV, like all of its cable peers, is suffering from the ravages of cord-cutting,” Moffett wrote.
The analyst also noted that the steep decline in traditional subs means that it is “all but unthinkable” that AT&T will make an effort to acquire DirecTV’s satellite TV rival Dish Network. Moffett also projects heavy video losses for Dish Network. “It is becoming increasingly clear that the wheels are falling off satellite TV,” he wrote.
The hurricanes that battered the southeastern U.S. and earthquakes in Mexico took a toll on AT&T’s wireless and video services, the company said.
AT&T warned that the drop in traditional video subs will hurt its revenues and margins. Adjusted consolidated operating income for its entertainment group will be flat year-over-year. But AT&T reiterated in the filing its full-year guidance of mid single-digit earnings growth and free cash flow of around $18 billion.
The subscriber losses at DirecTV underscore AT&T’s desire to diversify its holdings by adding Time Warner’s studio and networks to its portfolio, even though the earnings power of TW’s cable networks is also impacted by the erosion of the traditional pay-TV bundle. AT&T and Time Warner are said to be expecting formal word from the Justice Department on its review of the $85.4 billion merger by mid-November.
Thanks to spintreebob for pointing out this article.
Looks like the NFL Colon Cancer may be contagious.
First ESPN, and now Direct TV,... are more victims soon to surface?
Granted, these companies weren’t growing by leaps and bounds before this. Still, this sure hasn’t helped.
cord cutting and cord nevers are snowballing
very few under 40s buy cable these days.
The only people I know who are normal buyers of cable are over 70. That’s not exactly a growing market.
For those who rarely watch TV, cutting the cord makes a lot of sense. For those who enjoy some of the more obscure channels (Discovery, Travel, Destination America, ID, History, TLC, etc.), cutting the cord is not a trivial matter.
I’m also not a fan of their commercial where a middle aged white nerd smacks his head into a beam in his attic and then continues to smack his head, followed by another glutton for punishment .. a middle aged disheveled white woman who gets a paper cut on her tongue from licking an envelope and goes back for more, followed by yet some other white idiot who sleeps outside his tent in poison ivy.
But then along comes a smooth looking minority couple in a nice home enjoying their DirectTV.
at t needed DirecTV for access to content, customers and spectrum. 2/3 of that is still good.
I cancelled my NFL Sunday Ticket.
I’m waiting 1 more week before cancelling Direct TV (only reason I had it was ....Sunday Ticket)
If the Packers stop with the SJW Virtue signaling I may relent. If not....
Streaming is really doing to cable what Amazon Prime (et al) is about to do to brick and mortar. It will come fast once it hits critical mass.
If course they NEVER consider lowering the rates they charge for their service. It has gone up every year, and the channel choices have gone down. I have Direct TV, and have over 300 channels of useless infomercials to choose from, and about twenty that I watch on a semi regular basis. They need to look in the mirror to see their worst enemy.
Actually it wouldn’t bother me if all of these mostly leftist media providers from Comcast/NBC, VZ, ATT, etc didn’t see their generally worthless liberal programming squeezed. I’m ready to pull the plug.
No wonder AT&T U-verse is pushing me to switch to DirecTV. AT&T U-verse is charging me about an extra $40 per month for the same service I would get from DirecTV. Maybe AT&T want me to make the switch now so they can jack up the rates on DirecTv later. Every time that I call AT&T to complain about the high prices, they tell me to switch to DirecTv or pay more.
Ever since AT&T took over my bill is never the same for each month. But I can’t stream because of low speed, high drag, internet service at my location thanks to CenturyLink DSL.
I wonder how many cable company bigwigs have said “maybe we should have lobbied for a la carte after all” in the past few years.
Too late now!
precisely!!!!!
The only hitch will be the availability of Internet service. Some people are still limited to Cable for their Internet service. Most people won't touch satellite for Internet. And as long as Comcast et al own the wire, the cost for Internet only service is going to continue rising. What's needed as the next step is serious competition for Internet services, whether by coax, fiber optic, wireless, etc.
I agree...If they raise rates because of losing customers, they’ll lose a lot more....
This of course follows decades of TV shows where the male characters are all either scum or morons, and the women are the only ones with any sense or brains whatsoever.
The identity politics and social justice crap from the left is dividing and destroying this country. But of course, that is their goal.
I cancelled my direct tv streaming. It was too expensive for a bunch of stale content that never improved over the months I had it. The only thing I was watching towards the end is Fox News.
I said screw this for $35.00 per month basic package. I went to yahoo and I can watch complete evening of Fox news the day after.
We dropped DTV last month and got a Tivo Roamio OTA. 4 tuners and 1TB drive. $399 up front but no monthly tivo service fees. It also connects to the net and has apps for most major streaming services and integrates them into your guide searches.
Very happy with it; Not missing DTV.
ATT has a U-Verse for copper wire delivery.
Our DSL was running around 3mps; changed to U-Verse over copper and it comes in around 12-13 which is good enough for streaming.
Then my son loves to call and tell me he’s getting 131mps over cable.
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