AT&T (NYSE: T) CEO John Stephens told investors that, on average, the carrier's roughly 6 million U-verse video customers pay $17 more each month for programming than those on the company's newly acquired DirecTV platform.
Speaking at a Morgan Stanley Conference around 100 days after AT&T's purchase of DirecTV closed, Stephens said AT&T is actually ahead of its projections to recoup $2.5 billion in synergistic savings in the first three years of the merger.
"Content is a significant part of that," he said. "And we've made great progress in getting the best industry pricing."
Stephens may have been alluding to U-verse's recent carriage deal with Viacom, which was negotiated with the help of a DirecTV platform that includes nearly four times as many subscribers as U-verse. Indeed, AT&T is now the world's largest pay-TV provider.
"As [U-verse] customers shift to our DirecTV platform, we have an opportunity to capture savings, as well," he said.
AT&T also gains DirecTV's much larger footprint, which covers a population of nearly 100 million homes vs. 30 million for U-verse. When customers move, Stephens said, they now have a much greater chance of remaining in the AT&T footprint in their new location.
Vendor overlap is another benefit, he said, noting, "We've gotten the best of each company's contracts."
Stephens added that AT&T has held off in aggressively promoting its new satellite platform, waiting for its 40,000 technicians to be trained to install both broadband and satellite video in one service appointment.
"We didn't want to set up our customers for what would be a challenging two-appointment install," he said.
- visit this AT&T investor relations site
AT&T's Stephens: Fiber rollout is driving uptick in SMB managed services sales
AT&T will send out technicians who can install DirecTV, U-verse and broadband starting in November
AT&T's Stephens: Company ready for pay-TV changes; U-verse subs may migrate to cheaper DirecTV services
AT&T renews Viacom pact, gets 'best deal in the industry'