Verizon Sheds 81,000 Pay TV Customers as Cord-Cutting Escalates

iStock / Getty Images Plus
iStock / Getty Images Plus

Verizon has reported a loss of 81,000 pay-TV subscribers for its FiOS service  which is on top of a 25 percent decline in revenue for its media unit.

With its newly released second-quarter report, the company says its loss of 81,000 pay-TV subscribers is in addition to a loss of 84,000 in the first quarter, the Hollywood Reporter notes. Verizon said the loss is part of the ongoing shift as customers cancel their cable services and trend toward online and streaming services.

The telecom company did note that as the pandemic hit, forcing many to shelter in their homes, its video game services saw growth and were up 75 percent in peak hours. Video streaming also increased by 12 percent. But Verizon also noted that its media unit was hit hard with consequences from the coronavirus.

The media unit — including Yahoo, AOL, and HuffPost — posted second-quarter revenue of $1.4 billion, which is down 24.5 percent from a year ago. Verizon said this was “primarily as a result of COVID-19 related impacts.” While noting that revenue improved a bit in June as the lockdowns abated, Verizon still expects a revenue loss in the teens for the third quarter.

Verizon’s Media Unit has struggled for several years. In Jan. of 2019, Verizon fired 15 unionized writers at its HuffPost opinion section citing restructuring plans. The layoffs were part of the elimination of 800 jobs in its media and advertising departments.

Explaining its five percent revenue loss, the company said, “This decline was primarily the result of significant declines in wireless equipment revenue in the consumer and business segments, primarily due to limited in-store engagement and the impact of COVID-19 on customer behavior.” Some of the losses can be traced to the company’s closing of many brick-and-mortar retail stores during the pandemic.

“Second-quarter earnings rose from $3.9 billion, or 95 cents per share, to $4.7 billion, or $1.13 a share. Adjusted earnings per share fell from $1.23 to $1.18, but came in ahead of analysts’ expectations,” the Reporter added.

Hollywood Reporter went on to note that Verizon had joined the Black Lives Matter boycott of Facebook.

Verizon recently joined the growing #StopHateForProfit campaign, with the telecom giant pledging to pull its ads from Facebook and its Instagram. “We have strict content policies in place and have zero-tolerance when they are breached, we take action,” Verizon’s chief media officer John Nitti said in a statement. “We’re pausing our advertising until Facebook can create an acceptable solution that makes us comfortable and is consistent with what we’ve done with YouTube and other partners.”

Vestberg said in Friday’s earnings report: “We remain focused on our strategic direction as a technology leader, quickly adapting to the new environment and providing our customers with reliable and vital connections and technology services, while working to keep our employees safe and accelerating our 5G network deployment. We have embraced, engaged in, and responded to important social movements happening throughout the world, and will continue to be at the forefront of initiatives that move the world forward for everyone.”

Verizon also recently jumped into the political arena by shutting down President Donald Trump’s texting program, claiming the president’s voter outreach program presented “potential regulatory problems.”

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