Directv 4th Quarter numbers are dismal.

Discussion in 'DIRECTV General Discussion' started by dreadlk, Jan 30, 2019.

  1. Feb 5, 2019 #121 of 145
    NashGuy

    NashGuy Active Member

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    Yeah, AT&T made a doubly poor bet when buying DirecTV; they bought a major MVPD at a time when cable TV was about to enter a long-term secular decline (due to cord-cutting/rise of streaming/ballooning cable TV costs) and they picked an MVPD with a physical network (DBS) that isn't suitable for also distributing broadband service (unlike cable and fiber, where the double play helps them).

    Imagine instead of buying DirecTV if they had spent the money on acquiring some medium-sized cable MVPDs largely outside of the AT&T wireline footprint -- maybe Time Warner Cable and what's now Altice USA. And/or otherwise poured more capital into expediting FTTH, plus other technologies (fixed wireless, AirGig, G.fast) to improve their broadband network.
     
  2. Feb 5, 2019 #122 of 145
    NashGuy

    NashGuy Active Member

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    I think the next shift in the evolution of TV is for the cable bundle to further break up, although not go away. Next year is going to be interesting because by then we'll not only have Netflix, Hulu, Prime Video, and CBS All Access, but also major new on-demand streaming services from Disney, WarnerMedia/HBO, Apple, and Comcast/NBCUniversal. The lure of these new services will put even more pressure on consumers to decide between traditional cable TV and streaming, because virtually no one is going to continue paying $70-200 per month for traditional cable/sat TV, PLUS Netflix (which they're already doing), PLUS another 2-3 OTT services. An increasing number of viewers (but by no means ALL of them) will see OTT -- with its exclusive content -- as where the entertainment action is, not their cable box. So I see the cord-cutting trend accelerating.

    The trend, along with the fact that most of the major broadcast/cable network owners will also be in the OTT game, may make the network owners finally admit that the day of the bloated cable channel bundle is over. Better to let a consumer buy a skinny bundle with just a few of your channels (hopefully as a complement to your on-demand OTT service) than for him to not buy any cable bundle at all. Imagine a bundle with only, say, your major locals, ESPN, ESPN 2, FS1, NBCSN, Fox News, MSNBC, CNN, TBS, and TNT. The focus would be on live sports and news, making it a great complement to a few OTT on-demand services. Such skinny bundles could be distributed not only through OTT apps like YouTube TV and Hulu but also by traditional MVPDs like Comcast, Charter and Dish.

    As for all those other cable networks, many of them will eventually die as linear channels but their parent companies will increasingly shift to being production companies for OTT services, either services that they own (as in the case of Disney) or owned by others (as we're already seeing Viacom do with Netflix and others).
     
  3. Feb 5, 2019 #123 of 145
    lparsons21

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    For consumers without high speed internet, satellite will continue to be their only solution. The question is can a single sat provider remain a viable, profitable company if their client base is only the rural customer. I don’t see a way forward for 2 satellite companies at all.

    Single channel streamers will be interesting to watch. CBS seems to have done ok at their $7 subscription deal with a mix of live, old and original programming. It will be interesting to see if ABC, FOX and others do this also or will there be a mix of Hulu and single/multi channels offerings?

    Speaking of Hulu, I think they are going to become the place for smaller content producers to provide their shows. And the various streaming apps need to make their apps across devices. IMO right now the Xbox One and AppleTV seem have the better version of apps, possibly Roku does too but I don’t have a Roku to check.


    Sent from my iPad using Tapatalk Pro
     
  4. Feb 5, 2019 #124 of 145
    SledgeHammer

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    If you go from Sat/Cable to a single service like Netflix, then yeah... but who'll do that? Netflix + ESPN + HBO + a few others and you're right back to where you were with Sat/Cable as most one off services seem to be pricing around the $15 mark. I bet you Disney will be in that range.
     
  5. Feb 5, 2019 #125 of 145
    Rich

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    I've never tried an Xbox. I've tried a lot of streaming devices and the ATVs are always my choice. Even on there I find apps that are annoying. Then I use a Fire TV device and those same apps are even more annoying. Wouldn't you think the makers of these apps could agree on some kind of standard at least for navigation? When using DAZN if you have to stop the program and do something there's no way to get back to where you were, you have to hunt thru the program to find where you left off. NF works effortlessly, the navigation is easy, why can't they use NF as a template?

    Rich
     
  6. Feb 5, 2019 #126 of 145
    NashGuy

    NashGuy Active Member

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    People say this but it's not really true. OK, let's say you pay $15 for Netflix 4K. Disney has said Disney+ will have less content than Netflix and be priced accordingly. I'm expecting it to be maybe $8. Then add in Hulu (with ads) for $6, Prime Video 4K at $9, and HBO Now at $15 (or some similarly priced tier of the forthcoming WarnerMedia service). That all adds up to $53, with no extra charges for equipment, HD picture quality, DVR service, multi-screen viewing, broadcast or other BS fees. That's not free but it's still definitely less than the average cable/sat bill. And of course any of those OTT services can be dropped and swapped for something else at any time.

    But it's also not just about the money. It's also about the changing way that folks are watching video, with a shift to on-demand via multiple devices. And it's about the content that people really want to watch, regardless of delivery format or price. As Netflix and other streamers buy up more and more of the talent pool, that's where the quality content is coming from.

    None of this is happening overnight but it is happening.
     
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  7. Feb 5, 2019 #127 of 145
    lparsons21

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    I have a Samsung KW950 Atmos soundboard setup. The Xbox One has a Dolby Experience that provides either real Atmos audio if the source material has it, or darned good faked Atmos if it doesn’t.


    Sent from my iPad using Tapatalk Pro
     
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  8. Feb 5, 2019 #128 of 145
    slice1900

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    I think their thought that was they didn't care about wireline, they knew they'd be doing fixed wireless. Once they launch the IP version of Directv going and start deploying fixed wireless 5G fast enough they will have a proper double play.

    I think they can be quite successful with that, I just don't see how it can earn back enough to come close to justifying the $50 billion they paid for Directv. Like I said Wall Street doesn't care, they made their money off that deal. I just yesterday saw yet another idiot analyst suggesting Apple should buy Netflix, as if buying a wildly overvalued company that barely makes any profit and keeps piling up debt could ever earn back in a tenth of what they'd have to pay for it! But imagine the commissions the M&A guys on Wall Street would make :rolleyes:
     
  9. Feb 5, 2019 #129 of 145
    SledgeHammer

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    If you use the free apps that come in your TV which aren't that great (I have a LG OLED and the Amazon Prime app crashes a lot). Once you start buying Rokus or Apple TVs or Firesticks for all your TVs and an OTA for locals, and a Tablo to record locals. Those are one time costs though. Plus you end up with a hodge podge of equipment and services and remotes and you lose a lot convenience. Plus, if you had slow internet, you'll need to bump that up to handle streaming or invest in other equipment. My sister for example only has 5Mbps service which my parents have 250Mbps hardwired in the router, but my dad didn't listen to my router recommendation and bought a crappy N router, so he only gets 10Mbps unreliably at the TV. They're talking about getting Netflix, but they'd need to upgrade to a AC router and since all their equipment is N (my dad didn't listen on that either), they might even need to even run a bridge to get everything on line.... or run a drop. So yes... once you get all going there aren't as many recurring costs, but start up cost is more then Sat/Cable and the end convenience is a lot lower.
     
  10. Feb 5, 2019 #130 of 145
    Rich

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    I dunno how these deals work. I watched Dow buy Union Carbide and the debt they assumed was considerable. $2,300,000,000. Didn't seem to bother the folks at Dow. My stock fund has a lot of Dow stock and keeps going up.

    Rich
     
  11. Feb 5, 2019 #131 of 145
    slice1900

    slice1900 Well-Known Member

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    That's a very different type of deal. Both companies were in the same business, and had been around a long time - and were not overvalued in the market like Netflix clearly is and Directv was if the cord cutting future had been fully taken into account.

    $2.3 billion in debt is chicken feed compared to the type of deals I'm talking about, Netflix adds that much new debt every six months to fund their content creation, and AT&T has a total of $170 billion in debt thanks to borrowing for the Directv and Time Warner acquisitions.
     
  12. Feb 5, 2019 #132 of 145
    James Long

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    AT&T had $534 billion in assets and $8.65 billion cash on hand. They have $168 billion in long term debt, $349 billion in total liabilities. They can pay their debts.
     
  13. Feb 5, 2019 #133 of 145
    NashGuy

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    I'm not sure that the purchase of DTV had anything in particular to do with their IP network plans, or that back in 2014-15 AT&T foresaw fixed 5G wireless as the future of their broadband network. In fact, I'm skeptical how big of a role they see for it even at this point, unless we're talking about AirGig, possibly with a 5G hop from the utility pole to the home, or long-range (but slower) 5G at lower frequencies, like what T-Mobile plans to do in less dense areas. As for fast mmwave fixed 5G, like what Verizon has begun doing in a few neighborhoods, that involves running so much fiber to small cells that I don't think it really saves that much cost over just doing FTTH in those areas. But yes, I do suppose we'll see AT&T make at least some 5G small cells that are deployed for mobile in dense urban and select suburban areas also work to provide fixed 5G for surrounding buildings if they don't already have FTTP in that neighborhood. The expansion of AT&T's broadband network may well be a patchwork of technologies.

    Anyhow, AT&T never really needed DTV in order to have their own MVPD on whatever broadband service they offer. They already had that with Uverse (managed IPTV), which could have been improved/rebranded/transformed into OTT, whatever. Yes, having the scale of DTV I'm sure has helped in terms of negotiating carriage contracts but, as you say, the incremental value there doesn't come close to justifying the acquisition cost. I'm not saying it was as bad an idea as AOL/Time Warner but AT&T/DirecTV wasn't a good idea.
     
  14. Feb 5, 2019 #134 of 145
    SledgeHammer

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    Have you checked recently? They got slammed on the ER a few weeks ago and they've never really recovered from the Oct crash. I got one of those too :(.
     
  15. Feb 5, 2019 #135 of 145
    tivofan2018

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    there awsome customer service is helping i am sure!!! i went to sign up and the lady asked if i wanted to return a box whats that have to do with signing up??? many moons ago DTV had first class customer service now it went to ****!!!
     
  16. Feb 5, 2019 #136 of 145
    SledgeHammer

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    Netflix isn't overvalued. You just missed the train so you're all bitter :) j/k. 139M subs and growing at a rapid clip. Especially internationally. There's 1B Chinese waiting to sign up as well. They haven't scratched the service in India either. You're also missing the big picture. They are spending the $8B a year on content they now own. Forever. At $0 licensing fees. They are putting out hit movies and getting A list stars in them which Hulu and Amazon aren't. They even beat (or was it tied) HBO in Oscar noms. Has any other streaming service gotten Oscar noms?

    With 139M subs, a $2 hike = $3.3B in revenue a year and they've got quite a bit of headroom to hike before people start to get annoyed. You can see why they aren't worried about spending $8B.

    Not to mention they are a potential acquisition target by a few big players like Apple.

    Disney made a HUGE mistake by bailing. Disney just said a few weeks ago that they are going to spend MORE then $8B/yr to spin up the service. You think they'll get 139M subs any time soon? Nope. Disney should have just negotiated a better deal and let Netflix worry about all the infrastructure.
     
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  17. Feb 7, 2019 #137 of 145
    lparsons21

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    Yes it is happening, but there are real issues for both the consumer and the companies providing the services. To your list of proposed providers, if you want something more similar to Cable/sat you need one of the replacement services, currently most cost about $25 to $40 for their most basic service and they all have limits on number of streams, usually 2 streams.
    Essentially today you can get a pretty good choice of things to watch for less than cable/sat as long as you make your list of 'needs' quite a bit shorter than what your cable/sat provider gives you. IOW, pay less, get less. And you need to be savvy enough to know how to switch apps for each, and each app has its own UI.
    On the company side the fact that you can stop/start service at any point makes business planning a bit tricky. For instance with HBONow, at worst case for them you could subscribe one month in the year and binge watch whichever original series that floats your boat and not have them for the other 11 months, and that represents a big net loss for HBO. It would be similar for any of the others. IMO it is going to be very interesting to see how this all gels out over the next year or so.
    For me and the way I want to watch TV streaming is in addition to a cable/sat subscription. Just way more convenient with fewer limitations. Not to mention that going to all streaming for what I would want would cost me more than my current cable subscription.
     
  18. Feb 7, 2019 #138 of 145
    Rich

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    To expect to see people abandon cable/sat providers en masse is...well, it's not gonna happen quickly. I/we stopped watching programs as they came out when it finally dawned on me that I didn't have to be tied to a schedule. That was when I started using VCRs, in the '80s. Record a program, watch it when I want to watch it, no time constraints. That was a lot of work. Then came DVRs. Made what I was doing a lot easier, no more tapes in racks or bins, no more ledgers to keep track of what was on each tape. Thought that was the final journey and I was satisfied. With MRV came the unified Playlist and that made things a whole lot easier. Then I discover NetFlix and their DVD rental service. That did away with buying discs. Next discovery was how much content was on the NF streaming service. Blended in NF with D* DVRs and I was satisfied again. Found myself using the NF streaming video service more than I used the content on the DVRs. Slowly the DVRs became less relevant. Amazon Prime became a real thing and added their streaming video service to the mix.

    Had a "wait a minute!" moment about 3 years ago. Finally dawned on me I was watching everything online except sports. Began transitioning my wife's viewing habits to meet mine. When we watch TV together now it's always on a stream. She still watches some shows on D*, still can't get past that. But she will come around one of these days. My wife is the only person in our home that watches series or movies using a DVR or live TV. My son has one HR for the occasional hockey game. Sadie wants nothing to do with DVRs.

    Simply put, it's gonna take a lot of time for folks to get used to streaming and by that time I wouldn't be surprised if another, far better way to watch TV popped up. VCRs...best thing that ever happened to me...DVRs...best thing that ever happened to me...streaming...best thing that ever happened to me...unless something better comes along. Evolution at work.

    Let me add this: When I kept saying, "best thing that ever happened to me" I meant in the context of watching TV.

    Rich
     
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  19. Feb 7, 2019 #139 of 145
    mjwagner

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    For us the moment that got us to ditch D was a couple of years ago when my wife and I realized that we hadn’t watched anything on D in weeks. I really wondered why we were paying for something we hardly ever used. The other thing for us was the number of “occasionally used” tvs we have in our house, total of 7 tvs 4 of which are only used occasionally. We only really need 2 simultaneous streams (we use PSVue so we have 5) but we use those tvs. Not all the time but we do use them. My entire PSVue bill is about what D would charge just in receiver fees for those 7 tvs.
     
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  20. Feb 7, 2019 #140 of 145
    NashGuy

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    Yeah, as I said above, I don't see multichannel cable TV services going away in the next several years either, but I think we will see an increased trend toward smaller, more flexible bundles of channels, with an emphasis on locals, sports and news (the stuff where live TV has an advantage vs. on-demand streaming). And there will continue to be so many different ways that consumers can get TV and stitch together their desired services. It's going to be messy. We'll see various TV providers and streaming box/stick makers work on ways to conveniently integrate cable channels with OTT content, both in terms of the UI as well as unified billing. A good example of this already happening is Comcast's X1, which integrates Netflix, Prime Video, etc.
     

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