Verizon Communications Inc. (VZ) Vie to Recapture Cord Cutters

Verizone (VZ)

Verizon Communications Inc. (NYSE:VZ) is vying to entice both cord cutters and cord nevers within its marketing clout with a package deal that boasts of one year free Netflix, on top of 50 mbps FiOS internet at $59.99, HBO, Showtime, and local TV channels. Other providers offer comparable packages in an effort to win customers, but Verizons latest offering is the best of the available packages so far. Although the company’s FiOS, HBO, Netflix, and Showtime package was meant to be an special offer in the New York area, Verizon soon found out that customers all over the country eventually want Netflix or live sports coverage despite initially registering for a data-only package.

In The Zacks Analyst Blog of CNBC, Leichtman Research Group was cited as reporting that as much as 150,000 subscribers was lost from the U.S. Pay TV companies in the third quarter of 2014. The loss is attributed to the availability of lower priced video streaming offered by online providers.

Verizone (VZ)

On the other hand, Verizon hopes that its customers will find the package a good experience to start with, and eventually re-capture cord cutters in the process. The idea is that those who sign up for the initial package will gradually add FiOS TV, which is an app that allows users to watch TV outside the home.

A report in Investors Business Daily cites Tim Horan, an Oppeinheimer analyst, as saying that the Verizon package is competitive and poised to recapture cord cutters.

Added to the challenge of dwindling pay TV subscribers base, however, is the fact that competition is relatively stiff. Other players in the pay TV market such as AT&T Inc. (NYSE:T) and Comcast Corporation (NASDAQ:CMCSA) have launched their own packages in an effort to contain subscriber loss, with Comcast even creating a package that  specifically targets college students as potential subscribers.

This article has been written by Nonito Guntan.

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