Verizon Loses 52,000 Pay TV Subscribers in Second Quarter

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Verizon CEO Hans Vestberg

The telecom giant, led by CEO Hans Vestberg, reports its latest financials.

Telecom giant Verizon on Thursday reported that it lost 52,000 net pay TV subscribers for its Fios video service in the second quarter, compared with a loss of 37,000 in the year-ago period and a loss of 53,000 in the first quarter.

Fios competes with cable and satellite TV services. The subscriber losses were "reflecting the ongoing shift from traditional linear video to over-the-top offerings," Verizon said.

The company's broadband service added 28,000 subscribers in the second quarter, compared with 43,000 in the year-ago period.

After its acquisitions of AOL and Yahoo, Verizon created a new division, Oath, which was then expanded further to become Verizon Media Group and encompass all of its media and advertising businesses. For the second quarter, Verizon Media, led by Guru Gowrappan, said its revenue fell 2.9 percent from the year-ago period to $1.8 billion. "Gains in native and mobile advertising continue to be offset by declines in desktop advertising," the company said.

Verizon, led by CEO Hans Vestberg, had for some time planned to launch a live TV streaming service for young wireless users who are cord-cutters or cord-nevers, but it then decided to instead offer other over-the-top (OTT) services via its platform.

In that vein, the company with its first-quarter earnings announcement unveiled a partnership with Google's YouTube TV streaming service, serving as a re-seller. The companies said Verizon would "also offer unique, high-value YouTube TV promotions to customers across platforms" including Fios TV and Verizon's wireless services.

Verizon management has in the past reiterated that the company wasn't eyeing any major content mergers or acquisitions to increase scale against rival phone and digital players.

Asked about competitor AT&T's strategy of bundling wireless services with content, such as HBO, Verizon CFO Matt Ellis on the conference said that "the most important thing to customers in wireless is the quality of the network experience," adding that while others bundle video and the like, "we continue to lead in phone gross adds and churn." Concluded Ellis: “When you have the best network, you don’t need to bundle other things in there.”