AT&T said it plans to quit investment its U-verse CPE system and can rather use a “derivative” of DirecTV’s in-house to produce a new, in-house TV product which the company stated will display content from AT&T and others. They also stated users would be able to access exactly the same content material while outside of the house.
AT&T (NYSE: T
) reported the addition of 73,000 U-verse TV subscribers in the fourth quarter, a significant decline from the 194,000 added in the same period of 2013.
AT&T posted a net loss of $4 billion in Q4 when compared with net earnings of $6.9 billion within the exact same period a year prior, with revenue going above analysts’ forecasts at $34.4 billion dollars.
AT&T experienced a slowdown of its U-verse pay TV service in the first quarter. However, the company is still bullish on its $49 billion acquisition of DirecTV (NASDAQ: DTV), which it wants to close in 2nd quarter.
John Stephens, AT&T senior executive VP and CFO, said he expects the deal—proposed 11 months ago now—to finally close in the second quarter.
“We have done a lot of work identifying opportunities for additional cost synergies between these two great companies,” Stephens said. “This includes savings from supply chain, installation, customer care and even sending just one bill. This has increased our confidence that we can significantly exceed the original $1.6 billion expected in cost synergies. In fact, we now believe cost synergies alone will exceed a $2.5 billion run rate by year three.”
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