Selling for Direct Tv

Discussion in 'DIRECTV General Discussion' started by Roanold, Jun 2, 2021.

  1. NashGuy

    NashGuy Well-Known Member

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    AT&T's original plan was to sell DTV (the service that had peaked) and hold onto AT&T TV (the new service they had hoped would grow and which they had put their own name on, positioning it as the intentioned flagship cable TV service). But TPG didn't want that. They were reportedly concerned about DTV customers cancelling and moving over to AT&T TV. In return, I imagine, AT&T said "If you're buying AT&T TV, then you're buying Uverse TV too."

    But as you say, yes, it would have been complicated to separate the two services out. I think it could have been done, though, although once the current set of universal carriage contracts with networks expired, each service would have to negotiate their own set (as Uverse TV had originally done separate from DTV).
     
    Last edited: Jun 6, 2021
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  2. Teetertotter

    Teetertotter Member

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    Isn't streaming the FUTURE??? And having good internet speed above 50Mbps?
     
  3. krel

    krel New Member

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    Yea but not everyone is gonna go though multiple apps to watch there shows let alone remember what shows are on what apps. Let them have a contract dispute people will still complain lol and streaming is worse they have to pay the platform to host there apps on aka apple roku. I'm not for paying 8 different subs liner tv is easier with all of your channels under one sub. And if my internet goes down I want to be able to watch tv
     
  4. codespy

    codespy Go Pack Go!!!! DBSTalk Club

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    Yes, and so are electric/hybrid cars. I’m not there yet, just like many others.
     
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  5. James Long

    James Long Ready for Uplink! Staff Member Super Moderator DBSTalk Gold Club DBSTalk Club

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    AT&T|DIRECTV's biggest problem is not customers cancelling satellite and moving to AT&T TV. Their biggest problem is losing customers on all of their services (satellite, former UVERSE and the new OTT streaming service). If they were more successful at retaining lost satellite customers as streaming customers the activist investors wouldn't be so nervous.

    Today isn't the future. Streaming services are doing "ok" but they seem to be building a lot of debt. The future is a promise. It doesn't pay the bills today.
     
  6. west99999

    west99999 Icon

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    If streaming ever takes over traditional tv services you will see the price of streaming services the same as they are today for traditional service.
     
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  7. krel

    krel New Member

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    If AT&T had better trained CSR'S that know how to run the systems on the computer and installers that are customer oriented maybe they wouldn't be loosing so many customers
     
  8. NashGuy

    NashGuy Well-Known Member

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    Certainly cutting the cord on cable TV altogether is the biggest problem that DTV faces, same as any other MVPD. But TPG didn't want to buy a satellite TV service losing subs at a faster rate than the cable TV industry overall, with a high customer acquisition cost, and then have to also compete against what is essentially a streaming version of the same service, with a much lower customer acquisition cost that can be offered at a significantly lower price. So it didn't really make sense for TPG to buy a stake in DTV without buying a stake in AT&T TV too, with the ability to manage both together.
     
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  9. harsh

    harsh Beware the Attack Basset

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    But they were surely keen on picking up a service that had a very faithful following of subscribers that paid well above average prices.
     
  10. NashGuy

    NashGuy Well-Known Member

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    Heh. Not sure how "faithful" the subscribers are when they keep leaving in droves. But, sure, AT&T finally priced it low enough for TPG to buy a stake. I don't deny that DTV brings in a lot of cash and will continue to bring in cash going forward, although probably less and less every year. I really wonder how much of a hit the subscriber count will take once NFL ST leaves at the end of next year...
     
  11. James Long

    James Long Ready for Uplink! Staff Member Super Moderator DBSTalk Gold Club DBSTalk Club

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    If they keep losing 3 million subscribers per year and they will be out of customers by the end of 2026. I assume DIRECTV will still have Sunday Ticket, just not as an exclusive. So the "faithful" can continue to watch.

    It is bad when a company loses 3.2 million subscribers and it is an improvement over the previous year's 4 million subscriber loss.
     
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  12. harsh

    harsh Beware the Attack Basset

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    You seem to be assuming that net losses should be linear but that's rarely the case. Losses more typically are a function of the remaining number of subscribers so it isn't at all surprising to see the successive subscriber losses being less than the preceding losses. The percentage of the remaining subscribers may indeed be linear.

    The impact of the pandemic was probably in their favor as well as people were probably watching more TV.

    I'd imagine they have also been seeing renewed interest from people who thought they were going to save big money by subscribing to streaming services and found that it wasn't what they had hoped both in terms of cost savings and usability.
     
  13. James Long

    James Long Ready for Uplink! Staff Member Super Moderator DBSTalk Gold Club DBSTalk Club

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    I made no such assumption.

    I also do not believe DIRECTV is marketing keep price sensitive consumers. The initial discounts may get them in the door (if they ignore the second year rates or hope for a special discount). But DIRECTV markets their service as "Premium TV" and charges accordingly.
     
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  14. harsh

    harsh Beware the Attack Basset

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    In more than a couple posts you have predicted an ending year of DIRECTV if they continue to lose the same number of subscribers each year. That suggests linear losses. If that isn't particularly likely, perhaps it shouldn't be mentioned.
    If only their hardware, software and customer service were a whole lot more "premium", such marketing might be warranted. Standing on RSNs isn't everything and in that case, you pay for what you get.

    I think most see the falling off of honeymoon pricing after one year as a "fine print" dirty trick given that they offered two-year discounting for so many years. Another sneak was to change "all included" to not include additional TVs as it originally did. Marketplaces are supposed to be distancing from caveat emptor, not getting closer; those aren't the marks of a premium offering.
     
  15. NashGuy

    NashGuy Well-Known Member

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    True about the losses. I wonder what, if anything, the new management group can do to improve the situation at DTV? There's no way that the service isn't going to continue losing subs -- that's just the reality of a cable TV industry that's in secular decline. And it's especially acute for DBS, given their lack of a TV/broadband double-play. Based on what I can gather, AT&T has lost 37.2% of their cable TV subs over the last 5 years (1Q21 vs. 1Q16) while DISH has lost 37.4% during that period. ("AT&T" is a combo of DTV, Uverse TV and AT&T TV. I suspect the figure would be a little worse for just DTV alone. The DISH figures are purely DBS customers.)

    As for NFL Sunday Ticket remaining on DTV after 2022, I dunno. I think the NFL's preference is to again strike a similar deal with an exclusive distributor and if that's what happens, there's every reason to believe it will be a streaming distributor. Amazon Prime Video and ESPN+ are the names that keep coming up. Now, as I've said before, I can see them striking a separate deal for distribution to commercial establishments such as sports bars, so many of which already have DTV. Perhaps DTV will continue to offer it to those accounts but not their residential customers. Only way I can see it still being available to residential DTV customers is if the NFL ends up shifting to an approach like MLB Extra Innings/MLB.tv, which is widely distributed through lots of MVPDs as well as via a standalone streaming app. (A lot like HBO Max, actually.) But even if the NFL does decide to shift in that direction, it will be a blow to DTV, as customers who care about NFL ST will be able to shift to any MVPD and get the package. So one less reason to stay with DTV.
     
  16. James Long

    James Long Ready for Uplink! Staff Member Super Moderator DBSTalk Gold Club DBSTalk Club

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    AT&T combining their Video customers (satellite, UVERSE and now AT&T TV OTT) as one number clouds the comparison.
    Apples to apples would be all of AT&T's services vs all of DISH's services - since we can't break out AT&T's numbers accurately.

    DISH reports satellite vs Sling TV and has been able to serve 2.3 million subscribers who have left satellite and other MVPDs for their OTT service.
    Closer to a 20% loss of subscribers for DISH since their OTT service grew to compensate for about half of the net satellite subscribers lost.
    In January 2017 87% of DISH's customers were on satellite, at last report 79% were on satellite.

    Such numbers for AT&T|DIRECTV would be skewed by UVERSE subscribers who provided a large number of "non-satellite" subscribers on the day of the merger. UVERSE wasn't a business that was grown to replace DIRECTV and suffered immediate post-merger losses due to AT&T salespeople selling the satellite service.
     
  17. NashGuy

    NashGuy Well-Known Member

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    Yeah, but combining Sling's sub count with DISH's doesn't make sense either, given that Sling is and always has been a skinny low-priced alternative to the full cable bundle. It's not the same thing as AT&T TV, which IS the full cable bundle (and comes pretty close to being priced as such) that just happens to be available OTT. AT&T had an OTT option priced similar to DISH for a short while (DirecTV Now, which originally started at $35/mo) but its figures were never included in their "premium" cable TV category constituted by DTV, Uverse TV and AT&T TV.

    But, yes, as I said, if we could look at just DTV's numbers, it would almost certainly have sustained a bigger loss of subs over the past five years than 37.2% (and larger than DISH's 37.4% decline), because I'd definitely bet that the combined "Uverse TV + AT&T TV" sub count hasn't declined that drastically. Before they all started getting lumped together in AT&T's quarterly report, I remember there being quarters where the DTV number tanked but the Uverse TV number barely dropped or even ticked up a bit.

    Anyhow, the question that interests me is how TPG plans to make money off their investment in AT&T's cable TV business. Is the plan to make some quick strategic changes to DTV to improve the numbers, positioning it for a profitable exit sale in a couple years? Or is it to hold the business long-term to milk the monthly cash flows until they dry up? And in either case, will the main thrust be to draw in more subs (i.e. greatly reducing the overall rate of decline in subs) or will it be to maximize profits (cut costs and increase revenues) on the existing, dwindling customer base?

    DISH continues to bring new Hopper and Joey receivers to market for their customers but DTV's tech platform has been stagnant for quite awhile and looks pretty outdated in comparison. Does TPG push to bring a new generation of Genies out? Or will the plan be to just use AT&T TV (possibly renamed to DirecTV Stream) as the shiny new customer acquisition vehicle while avoiding any further investment in DTV?
     
  18. James Long

    James Long Ready for Uplink! Staff Member Super Moderator DBSTalk Gold Club DBSTalk Club

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    Their satellite delivered "Flex Packs" are also a skinny low-priced alternative to a full price bundle. It is completely unfair to count non-satellite numbers for AT&T while ignoring non-satellite numbers for DISH. AT&T's decision to overprice their streaming services and kill off their low price bundles does not diminish DISH's ability to keep their subscriber losses under control.

    DIRECTV+UVERSE had 26 million subscribers at the end of 2014 and 15.8 million at the end of 1Q 2021. Over 10 million subscribers lost or about 65% of the customers they had.

    TPG believes they can make money off of AT&T|DIRECTV ... I wish them luck.
     
  19. NashGuy

    NashGuy Well-Known Member

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    Again, AT&T's non-satellite services (Uverse TV and AT&T TV) and DISH's non-satellite service (Sling) are not the same thing and you can't really compare them. And whether comparing the two companies' reported numbers is fair or not, well, they're all we have.

    But you're getting hung up on the AT&T vs. DISH thing, which isn't really what I'm getting at. I used the DISH numbers to simply underscore the reality that cable TV is in secular decline, with losses at DBS being even worse than the rest of the industry. So TPG has its work cut out for them when they're buying a cable TV group where something like 80-85% of the subscribers are on a DBS service.

    Only strategy I can see that makes any sense is to keep DTV positioned as the sports-lovers' DBS service with a healthy profit margin. It'll be for those who are willing to pay a premium to get NFL ST (for the next two seasons) as well as RSNs and live 4K sports. Like DISH, it will increasingly be just for rural dwellers who don't have access to non-DBS video options. That dwindling demographic will be divided between DISH for the budget/non-sports crowd versus DTV for the premium/sports-lovers crowd.

    Meanwhile, they use AT&T TV as the lower-cost growth vehicle, accepting lower profit margins and going head-to-head against YouTube TV as a national next-gen cable TV service available over any internet connection. Strike as many distribution partnerships as possible with broadband operators across the country as a turnkey replacement for traditional cable TV.
     
  20. James Long

    James Long Ready for Uplink! Staff Member Super Moderator DBSTalk Gold Club DBSTalk Club

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    It seems like fraud to dismiss 20% of DISH TV's subscribers, but I believe I have clearly stated my point without an abundance of words.

    If you're talking about the "traditional cable" (MVPD) industry as a whole perhaps you shouldn't focus on all of AT&T|DIRECTV vs 80% of DISH TV at all. Focus on an industry where there are 25% less subscribers to traditional "Pay TV" than there was five years ago - with AT&T|DIRECTV beating the curve by losing more than 37% of their customers over that period of time.

    I have lost hope that AT&T|DIRECTV will release a breakdown that separates their services by delivery method. The 1st quarter results were disappointing in the way they reported results for Video.
     

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