AT&T says broadcast retrans battles could cost it over 1M video subs in Q3

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AT&T has said previously that it expects video subscriber losses to continue this year as the company works to shift subscribers off promotional pricing. (DirecTV)

AT&T anticipates some tough content negotiations, especially with broadcasters, could dramatically accelerate DirecTV subscriber losses in the third quarter.

CFO John Stephens provided an update on the company’s strategy, and said it’s been holding a hard line in content negotiations, which is allowing it to achieve its content cost management goals. But, that tactic could result in an incremental 300,000 to 350,000 premium video losses above the previous quarter’s premium video results.

AT&T lost 778,000 traditional video subscribers (along with 168,000 DirecTV Now subscribers) in the second quarter. That means premium video subscriber losses for AT&T could push well past one million during the third quarter.

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Stephens said that AT&T’s aggressive stance in retrans negotiations could lead to more channel blackouts as well.

RELATED: AT&T loses 946K DirecTV, DirecTV Now subscribers in Q2

AT&T has said previously that it expects video subscriber losses to continue this year as the company works to shift subscribers off promotional pricing. But the company expects video subscriber trends to improve next year as its new service AT&T TV launches nationwide.

Stephens’ comments come as AT&T is embroiled in a contract standoff with Disney, which could cause DirecTV subscribers to lose access to ESPN, ABC, Disney Channel and other networks. Disney has started warning its viewers about a potential channel blackout.

“Our contract with AT&T for the ABC, ESPN, Disney, and Freeform networks is due to expire soon, so we have a responsibility to make our viewers aware of the potential loss of our programming," the company said in a statement. "However, we remain fully committed to reaching a deal and are hopeful we can do so.”

AT&T responded by saying it’s disappointed that Disney is putting viewers in the middle of negotiations.

"Our goal is always to deliver the content our customers want at a value that also makes sense to them," said AT&T. "We’ll continue to fight for that here and appreciate their patience while we work this matter out."

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