AT&T’s CEO predicts people will continue to cut cable out of their budget
Traditional TV continues to decline.
The traditional TV industry is declining year by year. In 2018, traditional cable lost about 3% of its customers. In 2019, the drop was 6.5%, whereas, in 2020, their customer base dropped by 11%.
During an earnings call, AT&T’s CEO John Stankey said that he expects the pay-TV industry to soon hit a level of little or no growth. He predicts that it will plateau once the number of pay-TV subscribers falls somewhere between 55 and 60 million users. Furthermore, he believes that a big chunk of those cable subscribers will be sports fans.
This last point is important because of COVID-19. Not only was there an increased rate in unemployment, leading to less spending, but considering that many sports were canceled, it led to an increased number of people cutting the proverbial cord.
However, while TV providers such as Charter Communications, Comcast, and AT&T, focus on delivering internet services, cable channels got hit hardest and that will likely continue. For cable channels, curd-cutting brings lower subscription fees, which is a big part of their overall income stream.
During his talk, John Stankey didn’t forget to mention that AT&T is working relentlessly on growing its streaming service, HBO Max. At the same time, due to the massive decline of customers, AT&T wants to get rid of DirectTV, its satellite-TV business.
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