DirecTV Sets Layoffs Of Hundreds Of Workers, Citing “Secular Decline” Of Pay-TV

Dade Hayes
·2 min read
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DirecTV is laying off hundreds of workers, most of them managers, in a staff reduction spurred by cord-cutting.

Most of the layoffs will affect managers at the company, a classification for a bit less than half of the company’s workforce, according to a person familiar with the move. About 10% of all managers will be affected, out of a total workforce in the range of 10,000. Employees were notified last week about the cuts, which take effect on Jan. 20.

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AT&T spun off the satellite TV operator in 2021. It is now a private entity controlled by AT&T and TPG, with the private equity firm owning a 30% stake.

“The entire pay-TV industry is impacted by the secular decline and the increasing rates to secure and distribute programming,” a company spokesperson said in a statement. “We’re adjusting our operations costs to align with these changes and will continue to invest in new entertainment products and service enhancements.”

DirecTV’s businesses include its primary satellite service as well as the U-verse cable system and the internet-delivered DirecTV Stream. As a private company, it does not report subscriber numbers, but the trend for the entire industry has been heading downward over the past decade. A recent estimate from Leichtman Research Group found that 66% of households have some form of pay-TV service, down from 79% in 2017.

Programming costs — long the bane of all distributors — are continuing to rise despite subscriber declines. DirecTV, which introduced the NFL Sunday Ticket package in 1994, has opted out of renewing it after years of losses. YouTube TV is ponying up about $2 billion a year for those rights.

The shrinking of the traditional pay-TV customer base across the board has prompted louder calls from Dish Network chairman Charlie Ergen for government regulators to allow a merger of Dish and DirecTV. EchoStar (which used to run Dish) and DirecTV sought to merge in 2002 before the Department of Justice filed suit to block the deal.

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