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AT&T Warns “Heaviest” TV Losses Are Still to Come

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AT&T has now warned it expects TV subscriber losses to be an even greater problem in the first quarter of 2020. The service has been the subject of subscriber decline every quarter during the last year, and the company does not expect that to change in the current quarter.

Earlier today, AT&T released its fourth quarter results confirming 945,000 premium TV losses in total, including 219,000 AT&T TV NOW subscribers. Comparing these figures to a year before and AT&T has lost four million TV subscribers overall, including more than 650,000 AT&T TV NOW subscribers.

Following the earnings release, AT&T held is usual earnings call where it was keen to focus in on the upcoming launch of HBO Max. Although, AT&T’s Time Warner CEO, John Stankey, also made it clear the first quarter of 2020 for AT&T’s video business won’t be any better than it has been in recent quarters. In fact, it might even be worse with Stankey advising that AT&T expects to see its “heaviest losses” during the first quarter of 2020.

The road to no low-value subscribers

Stankey did paint a more positive picture for 2020 in general with the company expecting to see “incremental” improvements to subscriber losses throughout the year. One of the reasons AT&T expects the losses to slow down eventually is the absence of low-value video subs.

Over the past year, the company has repeatedly made it clear it wants to remove subscribers who are on lower-cost plans and packages obtained through promotional discounts. This is exactly what has been happening over the last few quarters with AT&T slimming down its subscriber base by focusing on higher-value subscribers.

On this point, Stankey today explained that the company is “mostly through that” referring to its goal of removing low-value subs. Although Stankey did warn “we’ve got a little bit more work to do” when it comes to removing the last of them. It is this sector of the losses that AT&T expects to slow down and as the number of promotional or discounted plans continue to reduce, the company expects the subscriber losses to reduce, accordingly.

Another element AT&T is hoping helps to turn the tide on TV subscriber losses is the nationwide rollout of the standard AT&T TV live TV streaming service. According to Stankey, the company anticipates the new AT&T TV service will hit “its stride in the second quarter” and from then on, the TV side of the business to start to show incremental improvements in subscriber trends.

Source: AT&T

John Finn
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