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Discussion in 'DIRECTV General Discussion' started by dreadlk, Jan 30, 2019.
As are their customers.
Lowering prices reduces profits. Lower profits annoys the most important customers of AT&T|DIRECTV: Shareholders.
Subscriber count is less important than profit and dividends.
Revenue is less important than profit and dividends.
Earnings per share were down 40% in 2018 compared to 2017. Mostly seen in the 4th quarter. Would lowering DIRECTV prices increase earnings per share?
According to the info I just found, they used to have 21.01M subs in Q1 2017. They are now down to what? 19.5M or so?
So what makes more sense? Knocking $10 off the average bill: 21M * -$10 = -$210M in lost revenue. Or losing -1.5M subs? If the average bill of the lost subs was $140+, they made the wrong call for the shareholders. That seems like a no brainer to me since sticker on my bill is $117 probably after this last hike and that's for a low package Preferred Xtra and a ghetto DVR HR-24 (on legacy billing) on 1 TV.
And that's with a generous $10 price cut. If you went with only a $5 price cut, you'd be at $70/mo as the break even.
Now granted, I'm doing my numbers assuming they kept all the subs, but still .
It seems like losing millions of subs is much worse then a small price cut.
Besides, they can make up the difference EASILY and then some by fixing some of the issues we've discussed in this thread earlier (excessive truck rolls, not allowing self installs, etc).
Was 20.478 million, now 19.222 million. A 6% drop. UVerse and Directv Now posted gains ending the year with 24.944 million subscribers vs 25.244 at the end of 2016 (3% loss).
If all you care about is revenue then perhaps you math would work (using correct numbers). You would see "video entertainment" (DIRECTV, UVERSE, DIRECTV NOW) drop from $36.167 billion in 2017 to $33.357 billion in 2018 and be angry - if all you cared about was revenue.
But you are forgetting that the million customers that left were responsible for expenses paid by AT&T|DIRECTV ... the #1 expense being paying content providers. When AT&T|DIRECTV loses a million customers they don't have to pay the content providers per subscriber fees for those customers. So while revenues drop expenses also drop.
Overall the Entertainment Group collected $3.5 billion less in 2018 than 2017 but they spent $2.8 billion less.
The PR isn't good ... for their sake I hope 1Q is better.
They don't split out UVerse and DirecTV Now into separate line items? I'm not surprised since DTVN lost 14.3% of their subscribers in the 4th quarter. Total train wreck.
I don't think there is that much of a market for streaming live TV, but that's just my opinion. Streamers have historically preferred to binge watch episodes. Certainly not for the price T is asking.
AT&T splits out subscribers into the three providers ... I did not since all you seem to care about is the DIRECTV count.
DIRECTV's subscriber count loss was a little heavier in the 4th quarter than the previous three.
DIRECTV NOW took the greatest hit ... a gain of 436k for the year including a loss of 267k in the fourth quarter.
UVERSE gained 50k in 2018 (12k in the 4th quarter).
All I said was subscribers are bleeding due to the cost and the cost alone. Nobody complains about the picture quality. There are some people who complain about the equipment, yes, but to the point of leaving? Probably not many. I have an HR24 that takes 30 seconds to respond to a button push. Is it going to make me leave the service? If it did it 24x7, I'd get a replacement. If that one did it too, I guess I would cough up the extra $3 and upgrade to the HR54 and deal with the truck roll. On the other hand, if my credits roll off and my bill goes up $40/mo and they won't replace the credits, I'm probably going to be left with no choice to but to move to Dish. Preferred Xtra + HR24 for 1 TV value is simply not there for $117/mo.
AT250 is currently $104.99 - add $15 for the Hopper DVR fee and you're at a regular price of $119.99 (then add taxes).
AT200 (comparable to Choice) is currently $94.99. $109.99 plus taxes with Hopper DVR.
(No RSN fee ... $12 locals included in the list prices.)
I believe the fee is less for a Hopper Duo ($10?) which is a two tuner DVR. These prices do not include the new customer discount.
I'd probably go with the 200. I just looked at Dish's website. When did the 200 get to $89.99 for new customers? WOW. Last time I checked which was recently, it was like 60 - 70 if I recall. I guess they had a really big price hike? Well that's certainly not good. That takes away a lot of bargaining power if its the same price as DirecTV now.
$5 per year adds up. No jumps larger than that. It does include the in market RSNs that (if I recall correctly) are not part of Preferred Extra.
The question isn't are they better off, it are they better off having bought Directv rather than keeping the $50 billion they paid for them? I don't see how they are ever going to make back that $50 billion. Directv turns a profit, but half of it goes to paying the interest on the debt they took out for that purchase. It gives them better scale when negotiating which will help their streaming efforts but it won't pay back a fraction of that $50 billion.
If they end up with fewer than 26 million subscribers, the number they started with between Directv's 20 million and Uverse TV's 6 million, five years from now I think it will be pretty easy to pronounce it a failure. Even if they top that figure, it may still be a failure depending on how profitable that subscribers are, unless there's strong evidence it is driving people towards choosing AT&T for their internet connectivity (especially fixed wireless)
Yeah, Preferred Xtra doesn't have RSNs. The one smart thing DirecTV has done in recent times was create that package for us people that don't watch sports.
Hmm... well, it hasn't been good for DirecTV customers I would say in terms of service. But it was probably a smart buy. Cable & fiber are expensive to spin up and AT&T obviously can't go into any area they want. They are pretty stuck in the cities they are in already unless they buy another provider. With DirecTV there is no infrastructure or monopolies to deal with and they have nationwide access. I'd assume its cheaper to launch a satellite then build a fiber network where you have to tear up streets.
My city was supposed to get both GF and T fiber and neither has happened aside from new construction (and GF went belly up). Which who the hell wants to live there? I went to look at a new house in the new construction areas after work a few years ago... took me like 30 minutes to get there from my house. Not traffic, just lights and no freeway access. And the houses were super expensive and the lots were just ridiculously small. You could literally reach across and soap your neighbors back in the morning. That's how close these 1M houses were.
I'd say competition will spin up in the new year or two if 5G delivers. At the very least, it'll drive down ISP prices.
The way the numbers are reported it would be near impossible for an outsider to say. We don't have clean numbers for DIRECTV separate from AT&T. And even those with accurate internal numbers can only speculate where AT&T or DIRECTV would be without the merger.
I don't count success as remaining above 26 million total subscribers. While DIRECTV would love to keep every subscriber as some move to streaming, expecting to stay over 26 million is too much to ask.
It's kinda creepy how they all focus on their phones. But it's not just kids, take a walk in Times Square. Most people seem to concentrating on their phones even when crossing streets.
If you use a Fire TV device you should have no problems streaming. An Apple TV box is even better. All our TVs are smart TVs and we don't use the apps on them because the streaming boxes just work better. Especially when it comes to trickplay. It also depends on the apps, some work really well like NetFlix and AP. It varies from app to app (regarding trickplay).
These D* numbers are dismal, and frankly I think it will get worse for all the cable/sat providers. Might even not be so good for the streaming providers either as most of the guesswork about the cable/sat replacement streaming services seem to think they aren't making any money now. All of which points to even higher prices which is a big part of the problem now.
For the cable/sat streamers I think the issue for them is that the younger crowd don't want cable/sat nor the streaming replacements. And other than the user equipment fees/cost the prices for them will rise to something nearly the same as the cable/sat provider's pricing is now.
For streamers like Netflix and Amazon Prime it is a different story and both have responded with original programming to entice subscribers. But they depend on the production of cable/sat channel programming for the bulk of their catalog so if we start seeing some shifting in the cable/sat channel lineups, how will that affect their subscriber base going forward?
ATT's acquisition kind of reminds me of the local golf course's problem. Originally a family owned business with no debt, it was doing pretty good and supporting that family well. Then that family decided to get out of the golf club business and another family bought it, but they went into hock to do so. Then golf got less popular and membership/player numbers started dropping and now it barely breaks even.
IMO, going forward there is a major shifting in how we view TV/movies and how much it will cost. How much it will change is still up in the air but I think it may be substantial.
We're all zombies!!!!
Being a golfer and having seen that at a nearby course, that's a good analogy!