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Report: DirecTV parent AT&T to phase out satellites in 3 to 5 years
Sep 29, 2016, 3:04pm CDT
Shawn Shinneman
Staff Writer
Dallas Business Journal
AT&T Inc. – which is expected to premier its streaming service DirecTV Now later this year – reportedly will work to make streaming its primary TV platform by 2020.
AT&T last year acquired satellite-TV service DirecTV.
Under the timeline, as reported by Bloomberg, DirecTV set-top boxes and satellite dishes could be obsolete in three to five years.
Bloomberg cites people familiar with the plans.
Dallas-based AT&T (NYSE: T) has claimed no allegiance to satellite TV technology from day one of its $48.5 billion acquisition of DirecTV, but it hasn’t publicly provided any definitive answers or a timeline on a migration of its 25 million video subscribers toward the software-centric future of TV.
The company has, however, said it has much to gain from a move toward streaming as it integrates its mobile and broadband businesses with its entertainment wing.
Earlier this week, CEO Randall Stephenson revealed one way it will leverage that position. AT&T mobile subscribers will be able to use unlimited data on DirecTV Now without it counting against their monthly usage caps.
“To the extent that it’s driving further penetration in wireless or driving churn down in wireless, the lifetime value of a customer with this kind of product is actually quite attractive,” Stephenson said of DirecTV Now.
AT&T’s video business is a major Denver metro-area employer, and it’s not clear how a shift to all streaming would affect that.
About 1,700 people work in DirecTV business operations, mostly at offices in Centennial. A couple hundred of them work at a DirecTV satellite station south east of Castle Rock managing satellite transmissions and feathering in local broadcast content from around the country into subscribers' satellite and streaming services in 197 domestic TV markets.
The technology world is awaiting the arrival of 5G wireless, which is expected to provide the bandwidths needed to more seamlessly power high definition and 4K video, among other products.
AT&T currently has about 20.5 million DirecTV connections and about 4.8 million U-Verse connections, and the gap between the two numbers is growing. The company recently scaled back its U-Verse branding, removing the name from its internet and phone products.
