DIRECTV NOW to Will See Further Losses As ‘Customer Cleanup’ Continues

At the Credit Suisse Communications Conference in New York, John Donovan, AT&T Communications CEO shared that when it comes to DIRECTV NOW — the company is focused on “customer cleanup.” In March, DIRECTV NOW announced their new PLUS ($50) and MAX ($70) plans — more expensive with fewer channels — while retiring existing plans. AT&T allowed existing subscribers to keep the legacy with a $10 price hike.

Donovan said, “Trying to give them 100 bucks of value for $40 or $50 or $60, that’s not going to be a fit that is going to work for the customer or the organization in the long run.” In April, the company announced they had lost an additional 83,000 subscribers in the first quarter, after losing 267,000 subscribers in the fall.

The company had previously shared that losses are expected to continue. “There are a set of customers that are going to only be in the market to buy, below cost,” said Donovan. “I think now we’re getting a lot better handle on the sub-segmentation of this and beginning to understand who gets the most value from the product.” This aligns with a lot of the changes customers have seen with the DIRECTV NOW product — with slimming bundles and removal of expensive channels like NFL Network.