AT&T Stops Selling New U-verse Pay-TV Service Subscriptions

As expected, AT&T has stopped selling new subscriptions to U-verse, the telecom’s 14-year-old pay-TV service, in an attempt to move consumers toward upstart online TV service AT&T TV (formerly DirecTV Now).

“To help our employees serve our existing customers, we’re no longer selling U-verse TV. Service for existing U-verse TV customers is not impacted,” AT&T said in a statement on its website.

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AT&T lost more than 3.4 million linear TV subscribers in 2019, including 945,000 subs in the fourth quarter, ended Dec . 31. That included DirecTV and U-verse.

The telecom is pinning much of its video future on AT&T TV and HBO Max — the latter $14.99 monthly SVOD platform slated to launch in May.

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AT&T Lost 3.4 Million Pay-TV Subs in 2019

The pay-TV subscriber drain is no longer a drip. It’s a bursting dam.

AT&T Jan. 29 announced it lost more than 3.4 million linear TV subscribers in 2019, including 945,000 subs in the fourth quarter, ended Dec . 31. That compared with sub losses of 1.2 million and 391,000, respectively, in the previous-year periods.

Pay-TV, which includes DirecTV and AT&T U-verse, ended the year with 19.4 million subs — down 15.3% from 22.9 million at the end of 2018.

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More disconcerting is that AT&T’s much publicized foray into over-the-top video distribution isn’t resonating with consumers. AT&T Now TV, the brand name replacement for DirecTV Now, shed 665,000 subs last year, up 52% from a loss of 436,000 subs in 2018.

The online TV drop-off abated somewhat in Q4 to 219,000 subs, an improvement from 267,000 subs lost in the previous-year period. AT&T ended the year with 926,000 TV Now subs, a 42% decline from 1.6 million subs at the end of 2018.

And unlike rival Comcast supplanting pay-TV subs with high-speed Internet, AT&T actually lost broadband subs in 2019. That included a 1% decline in broadband and 23% drop in DSL. The telecom ended the year with 14.1 million high-speed Internet subs compared to 14.4 million in 2018.

With AT&T’s WarnerMedia readying the launch of HBO Max and rebranded (again) AT&T TV, CEO Randall Stephenson remains upbeat.

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“We delivered what we promised in 2019 and we begin this year with strong momentum in wireless, with HBO Max set to launch in May and our share retirement plan well underway,” Stephenson said in a statement. “Our 2020 outlook positions us to deliver meaningful progress on our 3-year financial and capital allocation plans as we continue to invest in growth opportunities and create value for our owners, as we did last year.”

 

AT&T Loses 544,000 Q1 Video Subs; Another 83K DirecTV Now Subs Depart

AT&T’s pay-TV and online TV businesses continue to reflect ongoing challenges as consumers migrate away from the traditional cable bundle toward an increasingly fragmented over-the-top video market.

The telecom April 24 reported it lost 544,000 pay-TV subscribers in the first quarter (ended March 31) — up 190% from a loss of 187,000 video subs during the previous-year period.

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AT&T ended the period with more than 22.3 million pay-TV subs, which includes satellite operator DirecTV and U-verse. That’s down more than 1.5 million combined subs from 2018.

Meanwhile, DirecTV Now — AT&T’s much-hyped standalone online TV service – lost 83,000 subscribers compared to a gain of 312,000 subs during the previous-year period.

The streaming service ended the period with 1.5 million subs compared to 1.46 million subs last year.

AT&T CEO Randall Stephenson attributed DirecTV Now sub losses to weaning out early subscribers paying the introductory $34.99.

‘We’ve seen the effect of that in the fourth quarter and the first quarter,” he said. “Second quarter you’ll see that moderate, and I actually believe second half of the year base of what we’re seeing in terms of uptake in the market on the new platform and the new product. We should have a decent second half of the year on DirecTV Now.”

AT&T Posts 267,000 DirecTV Now Q4 Subscriber Losses

Stop the funeral for pay-TV.

AT&T’s signature alternative — broadband-based DirecTV Now — suffered a major blow in the fourth quarter, ended Dec. 31, 2018.

The telecom Jan. 30 reported that the standalone online TV service lost 267,000 subscribers compared to gains of 368,000 subs in the previous-year period. The period included 65,000 free trial subscriptions.

AT&T attributed the decline to ending the service’s $35 monthly promotional pricing.

The tally does not include WatchTV, AT&T’s recent app-based $15 online TV service, which ended the year with 500,000 subscribers.

DirecTV Now ended the year with 1.59 million subs compared to 1.15 million subs at the end of 2017.

The subscriber loss is a shot across the bow for online TV, which launched in 2015 with Dish Network’s Sling TV. Hailed as an antidote to declining pay-TV – and SVOD – online TV offered premium TV channels without long-term contract at a fraction of the price of the traditional cable bundle.

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Yet, AT&T’s legacy U-verse pay-TV service added 12,000 subscribers, compared to a loss of 60,000 video subs last year. The distribution channel ended the year with 3.68 million subs compared to 3.63 million at the end of 2017.

The company ended the year with 14.4 million high-speed Internet subscribers, which was up a scant three-tenths of a percent from 14.35 million at the end of 2017.

Meanwhile, satellite service DirecTV lost 403,000 subscribers in the quarter – up 274% from a loss of 147,000 subs in the previous-year period.

El Segundo, Calif.-based DirecTV ended the year with 19.2 million subs – down 6% from 20.4 million subs at the end of 2017.

For AT&T CEO Randall Stephenson, reducing the company’s $183 billion debt load following the $85 billion acquisition of Time Warner is the No. 1 goal in 2019.

“In 2018, we generated record free cash flow while investing at near-record levels,” Stephenson said in a statement. “Our dividend payout as a percent of free cash flow was 46% for the quarter and 60% for the year, allowing us to increase the dividend for the 35th consecutive year. This momentum will carry us into 2019 allowing us to continue reducing our debt while investing in the business and continuing our strong record for paying dividends.

 

AT&T: DirecTV Now Sub Gains Offset Declining Pay-TV

Online TV service DirecTV Now added 342,000 subscribers through the end of the second quarter (ended June 30), up from 152,000 subs added in the previous-year period.

The platform, which added a new user interface and cloud-based DVR in the quarter, now has more than 1.8 million subs compared to less than 500,000 last year.

The gains offset ongoing subscriber declines at DirecTV and U-verse, which totaled a combined 262,000 subs. AT&T’s entertainment group ended the period with 25.4 million subs – up slightly from 25.2 million last year, which includes 20 million (DirecTV), 3.7 million (U-verse) and 1.8 million (DirecTV Now).

“The customers we lost, the cord-nevers, the cord-cutters, we’ve replaced with products that are in their affordability range,” John Donovan, CEO of AT&T Communications, said on the fiscal call.

Broadband subs increased to 13.7 million from 13.2 million last year, underscoring AT&T’s rapid deployment of OTT video platforms, including the June 28 bow of WatchTV, a $15-a-month stand-alone service.

WatchTV features 30+ live channels and is compatible on virtually every current smartphone, tablet or Web browser and certain streaming devices. In addition to live programming, WatchTV includes more than 15,000 TV shows and movies on demand.

Donovan said subscriber-acquisition costs, operational costs, including deployment, are much less than linear TV.

“Over time, as we build those [OTT video sub] volumes, those are products that will get scalable margins,” he said.

AT&T said consumers continue to choose higher broadband speed tiers. About 68% of all broadband subs have purchased speed tiers between 18 megabits and 1 gigabit. Half of all broadband subs on AT&T’s fiber network have speeds of 100 megabits or more. Subs with speeds of 100 megabits or faster have more than doubled year over year.

 

Reese Witherspoon Launching SVOD Channel on DirecTV Now

Oscar-winning actress Reese Witherspoon is joining the over-the-top video universe.

Witherspoon’s Hello Sunshine production company is bowing two reality-based series on a branded channel via AT&T’s DirecTV Now OTT platform and the telecom’s old-school U-verse pay-TV channel.

The Hello Sunshine channel is available for $10 monthly for three months, after which it jumps to $35 a month.

Beginning July 17, “Shine On with Reese,” follows the “Big Little Lies” star as she interviews successful women, including Dolly Parton, Ava DuVernay, Pink, poet Cleo Wade, Sprinkles founder Candace Nelson and Spanx founder Sara Blakely, author/activist Glennon Doyle and World Cup soccer star Abby Wamback, among others.

“Shine On’ is about experiencing with Reese the stories of exceptional artists, entrepreneurs and leaders who happen to be women, and reveals how their personal journeys are unique yet relatable,” Charlotte Koh, head of digital media and programming at Hello Sunshine, said in a statement. “It epitomizes our goal of telling unexpected stories from interesting women’s perspectives.”

The second series – “Master the Mess” – about dealing with household clutter and hoarding, begins streaming/airing Sept. 4.

Decluttering gurus Clea Shearer and Joanna Teplin are The Home Edit, a Nashville-based business that blends comedy with organization. The Home Edit team tackle the pantries, closets, bathrooms and laundry rooms of overwhelmed families.

“Providing an empowering platform for diverse voices is a priority for us,” said Valerie Vargas, SVP advertising and creative services at AT&T. “Our work with Hello Sunshine gives stories about women the spotlight they deserve, which inspires our viewers and drives authentic conversation.”

Viewers can go to att.com/hellosunshine for a sneak peek at the first episode.