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AT&T (T) to Shut Down U-Verse and Shift Users to DIRECTV
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Per a recent FierceCable report, U.S. telecom behemoth AT&T Inc. (T - Free Report) is planning to completely phase out its long-standing U-verse brand by May 30. The brand consists of fiber-based triple-play video (TV), voice (telephony) and high-speed broadband (Internet) offerings. This move is in line with AT&T’s strategy to discontinue the service. The service has faced blackout in 23 states since Mar 15.
Accordingly, AT&T plans to shift some U-verse customers to satellite TV service provider DIRECTV, while some will be transferred to its over the top (OTT) online streaming service, DirecTV Now. By venturing into the OTT space, AT&T joined the likes of DISH Network Corp’s Internet TV service - Sling TV and Sony Corporation’s Playstation Vue, respectively.
Notably, AT&T earned $13,206 million revenue in the Entertainment Group Segment, up 1.6% year over year (post the DIRECTV acquisition). Of the total, Video entertainment revenues were $9,567 million, up 3.5%. As of Dec 31, 2016, total Satellite connections tallied 21,012,000 and U-verse connections were 4,253,000. AT&T lost 262,000 U-verse customers but gained 235,000 satellite TV customers.This proves the company’s strategic shift from its U-verse customers to the DIRECTV brand to be a positive one. In fact, this move bodes well with the weakening performing of U-verse brand compared to the improved business of DIRECTV. Moving ahead, this in turn is expected to free up very important bandwidth on its fiber-optic network, which AT&T can utilize to offer higher data transmission speeds to its high-speed broadband users.
The company officials have already started informing customers about the shutdown of the service. Moreover, the U-verse multi-screen app is also likely to get removed from Microsoft Corporation’s (MSFT - Free Report) Xbox One and Windows mobile platforms.
However, the final call is yet to be confirmed by the company.
Over the past three months, shares of AT&T lost 2.6% as compared with the Zacks categorized Wireless National industry's 4.3% decline. This was mainly led by the company's operations in a saturated wireless market, where spectrum crunch is a major concern. Additionally, persistent losses in access lines, mounting operating expenses, losses incurred from promotional offers, stringent regulatory norms and union issues act as major dampeners for the company’s growth prospects.
More Stock News: 8 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs.
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AT&T (T) to Shut Down U-Verse and Shift Users to DIRECTV
Per a recent FierceCable report, U.S. telecom behemoth AT&T Inc. (T - Free Report) is planning to completely phase out its long-standing U-verse brand by May 30. The brand consists of fiber-based triple-play video (TV), voice (telephony) and high-speed broadband (Internet) offerings. This move is in line with AT&T’s strategy to discontinue the service. The service has faced blackout in 23 states since Mar 15.
Accordingly, AT&T plans to shift some U-verse customers to satellite TV service provider DIRECTV, while some will be transferred to its over the top (OTT) online streaming service, DirecTV Now. By venturing into the OTT space, AT&T joined the likes of DISH Network Corp’s Internet TV service - Sling TV and Sony Corporation’s Playstation Vue, respectively.
Notably, AT&T earned $13,206 million revenue in the Entertainment Group Segment, up 1.6% year over year (post the DIRECTV acquisition). Of the total, Video entertainment revenues were $9,567 million, up 3.5%. As of Dec 31, 2016, total Satellite connections tallied 21,012,000 and U-verse connections were 4,253,000. AT&T lost 262,000 U-verse customers but gained 235,000 satellite TV customers.This proves the company’s strategic shift from its U-verse customers to the DIRECTV brand to be a positive one. In fact, this move bodes well with the weakening performing of U-verse brand compared to the improved business of DIRECTV. Moving ahead, this in turn is expected to free up very important bandwidth on its fiber-optic network, which AT&T can utilize to offer higher data transmission speeds to its high-speed broadband users.
The company officials have already started informing customers about the shutdown of the service. Moreover, the U-verse multi-screen app is also likely to get removed from Microsoft Corporation’s (MSFT - Free Report) Xbox One and Windows mobile platforms.
However, the final call is yet to be confirmed by the company.
Over the past three months, shares of AT&T lost 2.6% as compared with the Zacks categorized Wireless National industry's 4.3% decline. This was mainly led by the company's operations in a saturated wireless market, where spectrum crunch is a major concern. Additionally, persistent losses in access lines, mounting operating expenses, losses incurred from promotional offers, stringent regulatory norms and union issues act as major dampeners for the company’s growth prospects.
AT&T currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
More Stock News: 8 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs.
A bonus Zacks Special Report names this breakthrough and the 8 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains. Click to see them right now >>