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Questions remain as to whether the company’s data analytics and advertising arm, Xandr, will rollout quickly enough to reset the economics of the DirectTV investment
CHANTILLY, Va. (Sept 19, 2019) – In a just released report, AT&T Media Strategy Update 2019, BIA Advisory Services continues its exploration of the multi-billion-dollar investment into media distribution, content and advertising services by AT&T and whether it will reshape the media market in the United States for millions of subscribers to its cable services. The report is the second in a series BIA will publish with partners to examine the technical advancements that are having a dramatic effect on the media business.
With the introduction of AT&T TV, effectively an IP-streamed version of DIRECTV, AT&T for the first time has the ability to mitigate the impact of cord-cutting on its Pay-TV base.
“Even with the impact of cord cutting, the U.S. Pay-TV revenue base is still huge, and the advertising component of this has been flat at $70B per year. AT&T has plans to solve the long elusive problem of targeted ads, and if they can pull this off, they can change the whole calculus of Pay-TV profitability,” said Paul Connolly, BIA Executive Advisor and author of the report. The
“By using their unique asset of 170 million consumer touch points from their wireless, data, voice and video service offerings, AT&T is in a strong position to drive targeted ad solutions via Xandr, their data analytics and advertising arm,” said Connolly. “The question is whether the rollout of AT&T TV and Xandr can happen quickly enough to reset the economics of the DirecTV investment in AT&Ts favor, vs selling DirecTV as some are speculating/recommending should happen.”
|Defend Pay-TV Base||AT&T-TV|
|Improve Value of Base||Xandr ad exchange|
|Succeed in 2020 Streaming Wars||HBO Max|
With the announcement of HBO Max, and their intent to use HBO, the jewel in the crown of their Time Warner acquisition, AT&T has staked out unique position in the upcoming Direct-to-Consumer streaming wars, and has both the experience via HBO Now, and the stellar content to compete.
About the AT&T Media 2019 Strategy Update Report
Providing an updated look at AT&T’s media strategy and initial execution, the report is designed to give analysts, vendors and strategists an accurate understanding of how AT&T’s strategy and investment has and will unfold over the next 12-24 months. Nine actions are outlined which we expect AT&T to undertake as they move their increasingly important media business forward.
About BIA Advisory Services
BIA Advisory Services is at the forefront of local media analysis, creating and delivering unique data to examine traditional and digital advertising revenue, advertiser trends and activities, local market profiles and ownership/operational details and the trends and technologies guiding today’s media business.
Since 1983, BIA has been a valuable resource for traditional and digital media companies, brands and agencies, the financial and legal community serving media and telecom, as well as the FCC and other government agencies. Today, we offer comprehensive local market advertising intelligence in our BIA ADVantage service to help clients discover the path to their best opportunities. Learn more about our offerings at http://www.bia.com.
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