Whatâs Going On Here?Verizon posted a mixed set of results on Friday, so if the US telecoms giant canât beat the major streaming platforms, it might as well join them. What Does This Mean?Ever since the pandemic introduced people to the notion that they can still do their jobs effectively without sitting next to Keith from accounts, everyone's wanted high-speed internet in their homes. And that was just as true last quarter: Verizon said it added a net 229,000 broadband customers in the segmentâs biggest jump in over a decade. Problem is, it canât stop losing cell phone and cable TV customers. That dragged on its total revenue, which came in just 2% higher than the same time last year. Investors booted up their computers, dialed up, and made their thoughts known half an hour later: they sent Verizonâs stock down. Why Should I Care?The bigger picture: Verizon bundles up.
The loss of cable TV customers reflects a longer-term shift away from traditional scheduled television toward on-demand streamers. So Verizonâs changing tack: itâs planning to partner up with streaming companies and offer their products as part of bigger phone, broadband, and TV bundles. Itâs already struck a deal with Disney, and it announced last month that itâs launching a new service thatâll provide a range of subscriptions in one place. And since products like that should offer customers more reasons to stay, it could make it easier for Verizon to hike prices further down the line too.
Zooming out: The good old days.
If all else fails, Verizon could always just ditch its media business. Thatâs what rival AT&T did: it completed the sale of WarnerMedia this month, meaning itâs now returned to its roots as a true-blue telecom company. Itâs just like old times: the newly focused business reported last week that it added far more phone customers than expected last quarter, and investors sent its stock up 4%. | 