DirecTV cuts 10% of workforce to combat eroding subscriber base

US pay TV platform DirecTV has informed its employees that the company is set to lay off around 10% of its workforce, which is currently around 10,000. The company, which span out of AT&T in 2021, said brunt of the cutbacks will fall on managers.

In a statement to CNBC, a spokesperson said: “The entire PayTV industry is impacted by the secular decline and the increasing rates to secure and distribute programming. We’re adjusting our operations costs to align with these changes and will continue to invest in new entertainment products and service enhancements.”

With a major financial correction taking place among streaming platforms, it’s easy to forget that traditional PayTV platforms have also been suffering an extended period of decline as a result of cord-cutting. While DirecTV doesn’t publicly report its subscriber figures, Leichtman Research Group reckons the company lost 400,000 subscribers in Q3 2022. Overall, LRG estimates that the largest pay TV players in the US (accounting for 92% of the market) shed 785,000 subscribers in Q3, 2022.

DirecTV’s financial woes are likely to have been a key factor in its recent decision not to renews its rights to NFL’s Sunday Ticket Package. Google secured those rights in an exclusive deal with the NFL worth around $14 billion over seven years.

The pressure facing US pay TV platforms is likely to lead to renewed speculation about a possible merger between DirecTV, 70% owned by AT&T, and Dish Network.