AT&T Hemorrhages 385,000 Video Subscribers in Q324 Oct, 2017 By: Erik Gruenwedel
Actually, it was worse than expected. AT&T Oct. 24 formally released third-quarter (ended Sept. 30) financial results disclosing it lost 385,000 U-verse pay-TV subscribers.
The telecom previously warned it would lose about 90,000 pay-TV subs in the fiscal period. The official 85,000 tally is correct when factoring in 300,000 subscribers gained via online TV platform, DirecTV Now.
"One of the key things is that the unusual or high nature of this quarter's losses had to do with some management decisions with regard to credit metrics and cleaning up some involuntary churn matters," CFO John Stephens said on the fiscal call.
Standalone service DirecTV Now has more than 800,000 subs since launching last December. Notably, 700,000 subs are new to AT&T, according to Stephens.
"Of the customers that we have coming in, about half of them come from our competitors, switching off a paid TV service. The other half – 10% or so come from ourselves, migrating from one of our services, U-verse or DirecTV," he said.
When including satellite operator DirecTV, AT&T had 25.1 million video subs — about 200,000 less than the previous-year period. By comparison, Dish Network’s Sling TV has more two million subs. Hulu disclosed it has 47 million subs when combining the SVOD service with online TV platform Hulu Live.
Meanwhile, the AT&T remains upbeat on the pending closing of its $84.5 billion acquisition of Time Warner, which includes HBO, Warner Bros., and Turner. The official closing date was pushed back a “short period” from Oct. 22 in order to get all regulatory ducks in a row.
“We look forward to closing our acquisition of Time Warner and bringing together premium content with world-class distribution to deliver a better entertainment experience for consumers and more effective targeted advertising,” CEO Randall Stephenson said in a statement.