AT&T to “evaluate multiple options and partnerships” for DirecTV following 1.2 million subs loss

AT&T has announced losses of over 1.2 million subscribers as the fate of DirecTV hangs in the balance with CEO Randall Stephenson saying that the company has “no sacred cows.”

In its quarterly results, the company announced that it has lost 1.16 million premium TV and 195,000 AT&T NOW subscribers in the year-to-date. The company attributes this to a focus on long-term value customer base and carriage disputes. 

The latter was highlighted by Stephenson, who said that “we had a couple of significant blackouts in terms of content, and those blackouts drove some sizable subscriber losses.”

Among those blackouts was a high-profile dispute with CBS, that saw DirecTV, DirecTV Now and U-verse cable systems lose access to a number of channels for a number of weeks. 

With income up 4.8% for the year and the company turning its focus towards its HBO Max SVOD offer, speculation continues to mount about whether the company will sell off the DirecTV business.

Despite saying that DirecTV will be “an important piece” of AT&T’s strategy for the next three years, the CEO admitted that “no portion of our business is ever exempt from a continuous assessment for fit and performance.”

He added that the company would “evaluate multiple options and partnerships.”

It is believed that AT&T has been under significant pressure from investment firm Elliott Management, which bought a US$3.2 billion stake in the company earlier in 2019. 

The three year plan, announced alongside the quarterly results, stops short at explicitly saying that the company will sell DirecTV but adds that AT&T will make no major acquisitions between now and 2022. 

A recent interview from Reuters with WarnerMedia CEO John Stankey, long-tipped to be Stephenson’s successor within the coming years, would indicate that the company is dispassionate about the DirecTV offer and that it views it solely as a means of accessing its users. He said: “We didn’t buy DirecTV because we love satellite. We bought DirecTV because we love the customer base, and the customer base could be migrated into more on-demand-oriented products and services.”

To this end, the company has announced that it will offer HBO Max to existing AT&T users who are subscribed to HBO – a number that stands at approximately 10 million.

AT&T is currently facing a lawsuit that alleges it misled investors in order to hide the failure of DirecTV Now, the streaming service that was recently rebranded as AT&T TV. The suit goes as far as to claim that supervisors at the company encouraged sales reps to create fake DirecTV Now accounts and sign customers up for the service without their knowledge.