DirecTV Monthly Fees Have Surged at the Same Time Customers Have Fled

AT&T’s satellite business has lost 15% of its customers in the last 18 months

DirecTV’s monthly fees have increased sharply in the last year, coinciding with a subscriber exodus that has AT&T CEO Randall Stephenson weighing if it’s time to offload its struggling satellite business.

In the past 18 months, DirecTV’s prices have spiked more than 20%, the New York Post first pointed out on Sunday night. The price for its cheapest option — a two-year commitment for its Select plan — now runs $70.50 per month on average, representing a 25% hike from June 2018. It’s most expensive option, Premier, has increased 11% to $162 per month during that same time.

Those price increases have come as customers have started to ditch DirecTV at an accelerated rate. The satellite company has gone from 20 million subscribers since April 2018 to 17 million at the end of September 2019. Overall, AT&T’s TV business has lost nearly 1.2 million customers during the third quarter.

AT&T, DirecTV’s parent company, told the Post its price hikes haven’t been as severe for existing DirecTV customers, going up between 4-6% overall.

“Our prices are in-line with others in the industry and reflect the increased cost of the content that we carry,” an AT&T spokesperson said. “We are committed to providing high-quality content to consumers at a fair price.”

DirecTV’s price increases have come after it merged with TimeWarner, a move Stephenson said would not hurt consumers, brushing aside one of the government’s chief concerns over the deal.

Now, Stephenson has reportedly started to consider whether it makes sense for AT&T to offload DirecTV. After DirecTV’s poor Q3 performance, Stephenson didn’t shy away from a potential DirecTV sale, saying there were “no sacred cows” under AT&T’s umbrella.

“[DirecTV] will be an important piece of our strategy over the next three years,” Stephenson said in October. “But no portion of our business is ever exempt from a continuous assessment for fit and performance.”

DirecTV’s subscriber exodus led an overall downturn for the cable and satellite industry during Q3, which lost 1.7 million customers during the quarter.  Altogether, the top 12 pay-TV providers now have 84.8 million subscribers — or about 7.4 million less than they did at the end of the third quarter in 2018.

“This marked the fifth consecutive quarter of record pay-TV industry net losses,” said. Bruce Leichtman, president and principal analyst for Leichtman Research Group.

Sean Burch

Sean Burch

Tech reporter • sean.burch@thewrap.com • @seanb44 



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