AT&T announced today that its DIRECTV and U-verse TV services combined for a net loss of 897,000 subscribers in the first quarter. The company’s streaming service, AT&T TV Now, also lost 138.000 subscribers, bringing the company’s total TV losses to more than one million in the quarter.
This was the first insight into how the Coronavirus crisis is affecting the pay TV business. AT&T is the first owner of a major pay TV service to report its first quarter results.
The company today noted the impact the virus has had on the economy, and warned that more troubling numbers could be forthcoming in future quarters.
“The economic effects of the pandemic and resulting societal changes are currently not predictable,” AT&T said today.
However, despite the obvious impact of the Coronavirus outbreak, AT&T has struggled for years to attract and maintain subscribers for all three TV services. DIRECTV and U-verse have now combined to lose roughly seven million subscribers since AT&T bought DIRECTV in 2015. (The two services lost 945,000 subs in the 2019 fourth quarter, long before the Coronavirus outbreak was an issue. Note: AT&T does not separate the sub numbers for DIRECTV and U-verse, choosing instead to combine them in its reporting.)
And AT&T TV Now, which had nearly two million subscribers less than two years ago, is now below 800,000.
AT&T has yet to offer a satisfactory solution to the escalating defections, and it recently stopped taking orders for U-verse, the TV service it has owned for almost 14 years. (The company continues to provide service for existing customers.)
DIRECTV is also likely to see more subscriber losses in the coming months due to the Coronavirus crisis, cord-cutting, and a growing concern among the satcaster’s customers that AT&T plans to phase out the business.
AT&T has introduced a new streaming service called AT&T TV, which is designed to replace DIRECTV at some point. But it’s unclear now whether AT&T TV is generating interest among consumers.
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— Phillip Swann