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Verizon Lost Fios Video Customers in Q4 2018

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Fios video customers in Q4 2018

Verizon Communications’ (VZ) Fios is a fiber-optic network service that provides video, Internet, and voice services to its users. Fios has been contributing largely to Verizon’s wireline component revenues. However, lately, the telecom company has been struggling to add or retain traditional video customers due to stiff competition from the over-the-top (or OTT) video streaming players.

In the fourth quarter, Verizon added 54,000 Fios Internet subscribers, but the company witnessed a net loss of 46,000 Fios video subscribers. The company has been facing a net loss of Fios video subscribers for the past several quarters, as users continue to migrate from traditional linear TV to OTT offerings at competitive prices. At the end of December 31, Verizon had 6.1 million Fios Internet connections compared with its 4.5 million Fios video connections.

In the fourth quarter of 2018, Comcast (CMCSA) and AT&T (T) lost a net of 29,000 and 391,000 traditional US pay-TV subscribers, respectively.

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OTT market

Users have been drawn to more flexible, modestly priced OTT services over higher-priced traditional cable or satellite connections. Currently, YouTube TV, Amazon Prime Video, and Netflix (NFLX) are dominating players in the video streaming market. In the fourth quarter, Netflix added a whopping 8.8 million customers worldwide.

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