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Pac-12 Network is restructuring

MiamiBuffs

Wᴉɐɯᴉ qnɟɟs
Club Member
This is DTVs CEO:

May 14, 2019 - AT&T CEO Randall Stephenson said DirecTV’s rapid subscriber base decline will continue this year as his company lets lower revenue customers leave the service as their contracts expire. Stephenson said getting low ARPU customers off of DirecTV is key to stabilizing AT&T’s video business. He warned that it will churn rates to spike but said that AT&T doesn’t see a way to get them to profitable levels.

During the most recent quarter, AT&T reported a net loss of 544,000 traditional video subscribers and a net loss of 83,000 DirecTV Now subscribers. The company’s total 627,000 video subscriber losses accounted for approximately half of 1.28 million subscribers lost by the U.S. pay TV industry in the first quarter.

The good news is that AT&T’s video business should achieve EBITDA stability this year and into 2020, according to Stephenson. He said going forward, DirecTV’s “thin client,” a streaming version of DirecTV that’s debuting later this year, will be the workhorse for DirecTV, and will bring price levels down for customers that are struggling.


Stephenson said sustainable content agreements were also a key to future plan.



So it sounds like the bullet points are;
  • They are bleed customers still and are actually now encouraging it to get smaller
  • If you signed up on an incentive promotion they'll let you go if you dont agree to full price (no more free Sunday Ticket?)
  • They will walk away from expensive content relative to delivered audience
  • They have some "thin" streaming plan in the works.
 

patebuff

Downgraded to half a star
Club Member
This is DTVs CEO:

May 14, 2019 - AT&T CEO Randall Stephenson said DirecTV’s rapid subscriber base decline will continue this year as his company lets lower revenue customers leave the service as their contracts expire. Stephenson said getting low ARPU customers off of DirecTV is key to stabilizing AT&T’s video business. He warned that it will churn rates to spike but said that AT&T doesn’t see a way to get them to profitable levels.

During the most recent quarter, AT&T reported a net loss of 544,000 traditional video subscribers and a net loss of 83,000 DirecTV Now subscribers. The company’s total 627,000 video subscriber losses accounted for approximately half of 1.28 million subscribers lost by the U.S. pay TV industry in the first quarter.

The good news is that AT&T’s video business should achieve EBITDA stability this year and into 2020, according to Stephenson. He said going forward, DirecTV’s “thin client,” a streaming version of DirecTV that’s debuting later this year, will be the workhorse for DirecTV, and will bring price levels down for customers that are struggling.


Stephenson said sustainable content agreements were also a key to future plan.



So it sounds like the bullet points are;
  • They are bleed customers still and are actually now encouraging it to get smaller
  • If you signed up on an incentive promotion they'll let you go if you dont agree to full price (no more free Sunday Ticket?)
  • They will walk away from expensive content relative to delivered audience
  • They have some "thin" streaming plan in the works.
It seems most of these carriers are learning what people are wanting. We shall see when the new contract is being negotiated, but you absolutely have to get the Pac 12 on the biggest carrier, whatever that maybe. You absolutely can not do this again.
 

Buffnik

Real name isn't Nik
Club Member
Junta Member
What I don't get is why the Pac-12 seems so opposed to do deals where carriage is offered to customers only as part of premium subscriber packages.

I understand that being available on the more basic tiers is very preferable, but I don't understand why it wouldn't be a good thing if PACN was available on all platforms but that it was an extra fee on a number of them.
 

BuffsNYC

Clubber Lang
Club Member
What I don't get is why the Pac-12 seems so opposed to do deals where carriage is offered to customers only as part of premium subscriber packages.

I understand that being available on the more basic tiers is very preferable, but I don't understand why it wouldn't be a good thing if PACN was available on all platforms but that it was an extra fee on a number of them.
I had to upgrade with Spectrum to get any Pac 12 network . . . of course, I'm a cheap **** and had the most basic package before.
 

Highlander

There can be only one
Club Member
This is DTVs CEO:

May 14, 2019 - AT&T CEO Randall Stephenson said DirecTV’s rapid subscriber base decline will continue this year as his company lets lower revenue customers leave the service as their contracts expire. Stephenson said getting low ARPU customers off of DirecTV is key to stabilizing AT&T’s video business. He warned that it will churn rates to spike but said that AT&T doesn’t see a way to get them to profitable levels.

During the most recent quarter, AT&T reported a net loss of 544,000 traditional video subscribers and a net loss of 83,000 DirecTV Now subscribers. The company’s total 627,000 video subscriber losses accounted for approximately half of 1.28 million subscribers lost by the U.S. pay TV industry in the first quarter.

The good news is that AT&T’s video business should achieve EBITDA stability this year and into 2020, according to Stephenson. He said going forward, DirecTV’s “thin client,” a streaming version of DirecTV that’s debuting later this year, will be the workhorse for DirecTV, and will bring price levels down for customers that are struggling.


Stephenson said sustainable content agreements were also a key to future plan.



So it sounds like the bullet points are;
  • They are bleed customers still and are actually now encouraging it to get smaller
  • If you signed up on an incentive promotion they'll let you go if you dont agree to full price (no more free Sunday Ticket?)
  • They will walk away from expensive content relative to delivered audience
  • They have some "thin" streaming plan in the works.
How do lower ARPU customers hurt DirecTV? It isn't like they manage the signal end to end. They broadcast from the satellite, and people with a receiver pick it up or not. Every incremental dollar appears to be a net positive. That positioning seems like complete bull**** to me.
 

Uncle Luko

Peckerwood
Club Member
I have Dish, so I get the Pac-12. My mom is a big Cowboys fan, and has Directv at her place. Living out in the country limits your options, but I told her to either get Dish or something else. Her Fox and CBS are still both off. When I paid her bill yesterday, it was ****ing 171 something, and she had most of the channels shut down, ridiculous. The CBS network, I think it's like 221? That ****er works, are they a separate thing or something?
 

CarolinaBuff

Club Member
Club Member
What I don't get is why the Pac-12 seems so opposed to do deals where carriage is offered to customers only as part of premium subscriber packages.

I understand that being available on the more basic tiers is very preferable, but I don't understand why it wouldn't be a good thing if PACN was available on all platforms but that it was an extra fee on a number of them.
I don't get that either. Didn't DTV offer to carry the P12 Network but only with an additional fee for customers and the Pac12 said no? Pac12 fans certainly would've paid an extra $5-10 per month and bars and restaurants would've too. It almost seems like they have this attitude that if you're not gonna put our product out there at we think is a fair price then we just won't deal with you. So instead they end up with very little market share. And all this when you're already behind the 8 ball from a timezone perspective. This is so dumb.
 

Highlander

There can be only one
Club Member
I don't get that either. Didn't DTV offer to carry the P12 Network but only with an additional fee for customers and the Pac12 said no? Pac12 fans certainly would've paid an extra $5-10 per month and bars and restaurants would've too. It almost seems like they have this attitude that if you're not gonna put our product out there at we think is a fair price then we just won't deal with you. So instead they end up with very little market share. And all this when you're already behind the 8 ball from a timezone perspective. This is so dumb.
What’s crazy about this is that it is an add on for SlingTV. Why in the hell are we not in the same tier for Hulu, Sony, YouTube, etc?

It’s just stupid.
 

skibum

Did not pee on the Alamo.
Club Member
How do lower ARPU customers hurt DirecTV?
They pay the content providers (ESPN, foodnetwork, etc) per subscriber, that's their cogs.

Their gross profits on lower arpu customers aren't enough to cover the rest of the costs - it's possible that in some situations they're gross losses even before applying the other costs.

Basically, their intro rates are loss leaders. But if they never turn those loss leaders into higher arpu customers, they're just losses.
 

patebuff

Downgraded to half a star
Club Member
They pay the content providers (ESPN, foodnetwork, etc) per subscriber, that's their cogs.

Their gross profits on lower arpu customers aren't enough to cover the rest of the costs - it's possible that in some situations they're gross losses even before applying the other costs.

Basically, their intro rates are loss leaders. But if they never turn those loss leaders into higher arpu customers, they're just losses.
What?
 

MiamiBuffs

Wᴉɐɯᴉ qnɟɟs
Club Member
Those loss leader (LL) customers payments, lets say $1 a month, are less than overhead costs of lets say $2 a month. The LL customer signed up on a promotion which is a loss leader incentive to attract new business (think free Sunday Ticket for a year). Later on those LLs are supposed to go to the rate the Normal Customers (NC) pay per month. The NC pays $2.50 a month returning 50 cents of profit for the company. Management, for some reason, extended the promotional price to the LL to keep their business thus extending the losses.

At the end of the year the LL customer paid $12 for something that cost DTV $24. Im sure you can see why Thats a problem.

Understand now?
 
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LaserDeathHawk

Club Member
Club Member
I'm beyond ready for a new media rights deal right now even if it is only ESPN+ or streaming only with a monthly plan. If the MWC gets on ESPN+, I will watch the MWC until the next P12 media rights deal is in place. I'm planning to watch some KU, KSU, and OSU stuff on ESPN+ this year as well. I'm just committed to the ****braska & AFA games this year and then I might just go somewhere else for my football fix.

And yes, a new commissioner would be nice as well.
I don’t get this board at all. There has never been a post more deserving of our default response and instead you freaks are typing out all these long winded responses.

So let me be the first to answer this ridiculous **** with a simple

**** you
 

CarolinaBuff

Club Member
Club Member
The Pac-12 needs to pull the trigger and ride the wave of the current marketplace instead of trying to outsmart everyone to be best positioned for what might be there in 10 years. I'm not saying to mortgage the future and give up the ownership model that is a long-term smart move for valuation, but the conference can't be lagging so far behind in the short-term that it's at a competitive disadvantage.

Besides, I bet if we polled the current ADs in the conference they'd unanimously say that they'd rather have an additional $10-$20M a year now with greater distribution versus patiently waiting 3-5 years to catch what could be a bigger wave.

I go back and forth. Mostly because I know that in an open marketplace the Pac-12 is the least valuable of the 5 conferences from a national media standpoint and that being smarter is the only way to end up outperforming that.
Yea that's one of the things that sticks out, how they're foregoing revenue and exposure opportunies now in exchange for a big gamble that it will somehow all pay off. This strategy of betting on a huge windfall when the next renegotation comes up has a huge hole in it that LS and the presidents seem to be ignoring, which is that the demand for Pac12 football and basketball isn't going to suddenly skyrocket. In the meantime the conference continues to fall further behind.
 

MiamiBuffs

Wᴉɐɯᴉ qnɟɟs
Club Member
Yea that's one of the things that sticks out, how they're foregoing revenue and exposure opportunies now in exchange for a big gamble that it will somehow all pay off. This strategy of betting on a huge windfall when the next renegotation comes up has a huge hole in it that LS and the presidents seem to be ignoring, which is that the demand for Pac12 football and basketball isn't going to suddenly skyrocket. In the meantime the conference continues to fall further behind.
It’s been pretty public if I recall that, after Dish and Comcast(?) signed, the offers from DTV and others have been lower AND would have required a claw back or some lowering at Dish’s (Sling) go first rate.

AND we would only be part of a Sports “add on” package instead an upgrade off basic where millions pay for something they don’t watch. Which kinda kills the exposure argument.

The mistake was having our own network instead of partnering with ESPN or someone that knew all this
 

MiamiBuffs

Wᴉɐɯᴉ qnɟɟs
Club Member
They pay the content providers (ESPN, foodnetwork, etc) per subscriber, that's their cogs.

Their gross profits on lower arpu customers aren't enough to cover the rest of the costs - it's possible that in some situations they're gross losses even before applying the other costs.

Basically, their intro rates are loss leaders. But if they never turn those loss leaders into higher arpu customers, they're just losses.
I believe that $4 of every bill you pay is JUST for ESPN. All the other bundled stuff that Disney/ESPN bring to the negotiating table all also have a fee. And because they come as a bundle the delivery provider is over a barrel.
 

BuffUp

[insert punctuation here]
Club Member
Directv is slashing their own throat. With all the streaming services out there and a lot of them are new to the game. Directv should be more willing to drop the price they charge these networks. They have been around about 30 years now, they should be streamlined and proficient by now. Instead, they are typical corporate greed and the CEO and a few up the food chain will bail at the last minute, with a huge golden chute of course.
As usual the paying customer are being screwed all the way to the end.
 

leftybuff

Unreconstructed Luddite
Club Member
Directv is slashing their own throat. With all the streaming services out there and a lot of them are new to the game. Directv should be more willing to drop the price they charge these networks. They have been around about 30 years now, they should be streamlined and proficient by now. Instead, they are typical corporate greed and the CEO and a few up the food chain will bail at the last minute, with a huge golden chute of course.
As usual the paying customer are being screwed all the way to the end.
xx
 

CarolinaBuff

Club Member
Club Member
Directv is slashing their own throat. With all the streaming services out there and a lot of them are new to the game. Directv should be more willing to drop the price they charge these networks. They have been around about 30 years now, they should be streamlined and proficient by now. Instead, they are typical corporate greed and the CEO and a few up the food chain will bail at the last minute, with a huge golden chute of course.
As usual the paying customer are being screwed all the way to the end.
I just cancelled DTV a couple of weeks ago and was amazed at how accommodating they were without even batting an eye. Complete 180 from a few years ago when you would call and threaten to cancel and they would bring in a manager and ask you would it would take to keep you as a customer. Now it was just like, ok sure.
 
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