AT&T’s epic DirecTV losses mount...

Didn't see the cash flow statement but operating income for the entertainment group (which is still basically Directv since AT&T TV is just getting off the ground) was over $1 billion. So long as it is profitable after debt service they probably don't care.

 

That's a lot of subs to lose in a quarter. Failing economy, perhaps? Lots of people out of work and D* isn't cheap.

Rich

 

Careful that’s net losses of all video subs. Includes uverse and att tv and the other streaming versions, one of which they flat said they are shutting down.

Still shows att has now clue what it’s doing though...

 

Would be really curious to know there conversion from Directv to ATT TV but they may not even know depending on account names and user ids

 

Considering the pandemic probably made every cable/satellite provider's subscriber losses worse, but would hit especially hard the service most popular with hardcore sports fans, that comparison is almost a silver lining for them.

I wonder how many bars/restaurants permanently closed and if the loss of those accounts are included? What about places like mine that suspended their accounts when they were forced to close and didn't turn them back on again even if they re-opened because without sports what's the point of paying for Directv?

 

Freaking stats...

Rich

 

How many months of unpaid bills before ATT disconnects a sat sub ?

 

Been saying that for quite a while. I did see something somewhere yesterday that said 16,000 restaurants and bars have permanently closed. Probably saw that in a news feed. 16,000, is that possible? I think that had to be for the whole country.

Been meaning to ask you, how are you coping with this? Did you have a worst-case scenario plan in place before this pandemic struck? I know the restaurants and bars are hurting here and in the City. When you look at the rents the owners have to pay in NYC it's easy to see why so many bars and restaurants and a lot of small stores are going down the tubes.

Rich

 

Great question. I have no idea.

Rich

 

Probably a couple weeks in normal circumstances.

AT&T was a participant in the 60 day "Keep Americans Connected Pledge" that kept non-paying subscribers connected to TV (91K) and broadband (159K).

https://docs.fcc.gov/public/attachments/DOC-363033A1.pdf

How they get the Pledge beneficiaries current rather than having them walk away from their debt (bills and in some cases ETFs) will be interesting indeed.

 

Just doing food pickup / delivery only. Thought about fully opening and I have the size to keep people separated but it just didn't seem worth it. Luckily I own the building so I don't have to pay rent to anyone but I still have a mortgage and I'm not making enough to break even so it is a drain. Being able to suspend Directv has helped. I'll have to review end of next month whether I want to try to open - probably depends on whether we actually have a football season or not. I'm skeptical. That's when I would really hurt - October - March are my biggest months. June/July are the slowest.

 

I know the pickup/delivery thing isn't enough to stem the tide. At least you haven't folded. So many bars have closed permanently around here. I can't imagine how the NFL is gonna work this year, I wouldn't be surprised if they didn't play. That has to be the hardest sport to keep everybody playing safe. Hope everything works out for you.

Rich

 

Note that the 954,000 number is not the number of customers who ran off; the actual number of defections is higher. The category is net additions and the number is negative. It is the difference between the number of customers who ran off and the number of people who signed up for service. For example, if AT&T added 46,000 new video subscribers, then there were 1,000,000 who left.

As I noted above, the number is further tainted by the fact that AT&T wasn't punting customers for non-payment for a couple of months.

 

The question now becomes.... how much of this is actually AT&T's/DirecTV's fault, how much is the program suppliers fault through per-subscriber fees, and how many is both due to carriage disputes?

 

I was wrong. There were 91,000 Pledge beneficiaries counted against the Q2 net adds. This isn't an overwhelming number at 9.5% of the net losses and an even smaller percentage of those walking away. I note that AT&T's Pledge was extended to cover all of the Q2 defaults.

Apparently AT&T doesn't publish their Average Revenue Per Unit (ARPU) numbers but they do say that they went up for Entertainment products. They attributed most of their decreases in expenses to having fewer customers.

 

There's so much more to it than that.

• The tide is shifting away from monolithic services like DIRECTV (yet AT&T's solution is to apply the same model to their streaming service)
• DIRECTV service is relatively expensive in a world where big monthly expenditures are looked at much more critically
  
• The availability of new and interesting content across many channels (especially sports where DIRECTV used to rule) approaches non-existent
• AT&T appears to have been absolutely unprepared to convert DIRECTV customers to a sustainable alternative

Carriage disputes are a necessity to combat the value proposition as the content distributors seek to squeeze revenue out of a dried husk of programming.

I suspect that once the novelty of having multiple provider wears thin and as the streaming services maintain their relatively rapid price march upwards, there will be some recovery but I don't think that even AT&T TV represents the future.