AT&T lost 590,000 premium television subscribers and 37,000 AT&T NOW customers in the third quarter of 2020. AT&T has lost 6.19 million premium subscribers in two years. Verizon lost 61,000 Fios video subscribers in the third quarter, while Altice USA lost 67,800. Charter overturned the trend with the net addition of 53,000 video customers. Generally, the United States saw an increase in internet subscriptions, as service providers promote online video and as people spent more time at home in the pandemic.

AT&T lost 590,000 premium television subscribers in the third quarter of 2020, including DirecTV, U-verse and AT&T TV, down to a total of 17.10 million compared to 20.42 million a year previously. It would have been a loss of 706,000 excluding accounts not terminated through the Keep Americans Connected Pledge. The company also lost 37,000 AT&T NOW online subscribers, down to a total of 683,000 compared to 1,145 a year before.

AT&T Premium TV subscribers 2020 Q3. Source: Multiscreen Index / company reports.

AT&T added 158,000 internet subscribers, with 357,000 net fibre connections offset by 199,000 non-fibre disconnections.

“We are focused on high-value subscribers as the industry transitions to over-the-top,” John Stephens, the chief financial officer told analysts. “Premium video losses were improved sequentially and year-over-year, thanks to lower churn and our focus on high-value customers. The decline is a significant improvement over prior year trends.”

He described the remaining customer base as “the ones we can make money on” rather than those switching between providers. “The AT&T TV product is a much more natural fit in terms of how customers want to use a pay TV service today than the satellite product is,” he said. “I’m not going to suggest to you that it’s anything but a mature business.”

He suggested that households that watch a lot of sport are likely to sustain the traditional television bundle business in the United States. “That when we kind of get down to that 55 million, 60 million household range, we’re probably going to see a little bit of a plateauing as a result of that. That doesn’t mean that the bundle stays the way that it is. I think there’ll be a number of channels in the bundle that probably fall away over time, and it gets a little bit thinner.”

AT&T now has 38 million HBO Max and HBO subscribers in the United States and 57 million premium subscribers globally. “The reason we’re doing HBO Max… is we want to be where the customers want to be,” he added. “We’re focused on building a platform that’s relevant for the next decade.”

Verizon lost 61,000 Fios video subscribers in the third quarter of 2020, ending with a total of 3.93 million, which is a big drop from the peak of 5.86 million it had in March 2016. The company said: “cord cutting remains the key driver of video disconnections”. It added 139,000 Fios internet subscribers, with a total of 6.11 million. It has 94.10 million mobile customers and seems more excited about the prospects of 5G.

Charter Communications by contrast added 53,000 residential video subscribers in same quarter, as well as 494,000 residential internet customers. It ended the third quarter of 2020 with 15.71 million video customers. It was the second consecutive quarter of video customer gains for Charter Spectrum, having lost 850,000 over the preceding nine consecutive quarters. Tom Rutledge, the chief executive of Charter, attributes the growth in video to the adoption of internet connectivity. “If you grow fast enough, you’ll grow video, as a result of that.”

He conceded that the concept of the fat bundle including video is under pressure and will continue to be eroded “but, we’re just growing faster than that erosion.”

In fact, Charter does not really sell video as a standalone service. Only about 5% of its video subscribers do not take another service from the company. Charter sells video as an application or a service attached to its connectivity offering.

“We think that people will continue to buy rich packages for years to come,” the Charter chief executive commented, “but we also think there are other opportunities to sell a variety of video services to consumers in different formats and that we can improve the customer experience by being a good place for consumers to interact with us to get those video services.” He said: “We’re actually optimistic in the very long term about our video business”.

Altice USA, reported a loss of 67,800 video customers, ending the third quarter of 2020 with 3.04 million. Organic quarterly net losses were actually 86,000, as Altice gained 35,000 customers with its acquisition of Service Electric Cable in New Jersey. That continues a trend of consecutive quarterly losses, amounting to nearly 350,000 since the end of 2017.