Business

DirecTV is laying off hundreds of employees — roughly 10% of its upper ranks — as the company looks to reduce costs, according to people familiar with the matter.
Managers make up about half of DirecTV’s fewer than 10,000 employees, one of the people said.
The cost reduction comes as cord cutting accelerates, especially at satellite TV distributors such as DirecTV.

A DirecTV technician at an apartment building in Lynwood, Calif.
Patrick T. Fallon | Bloomberg | Getty Images

DirecTV is laying off hundreds of employees — roughly 10% of its upper ranks — as the company looks to reduce costs amid the heightened pain of cord cutting for pay-TV providers, according to people familiar with the matter.
Most of the job cuts will be at the manager level, the people said, citing an email to employees sent on Friday. Managers make up about half of DirecTV’s fewer than 10,000 employees, one of the people said. The affected employees’ last day will be Jan. 20.

“The entire pay-TV industry is impacted by the secular decline and the increasing rates to secure and distribute programming,” a DirecTV spokesperson said in a statement. “We’re adjusting our operations costs to align with these changes and will continue to invest in new entertainment products and service enhancements.”
DirecTV became a private company in 2021 when AT&T entered into a deal with private-equity firm TPG to spin off DirecTV and its related businesses, with an implied enterprise value of $16.5 billion at the time. AT&T acquired DirecTV in 2015 for $48.5 billion and the assumption of debt.  
DirecTV and its peers have long been under pressure as customers cut the cord and opt for streaming services. The rate of cord cutting accelerated in the third quarter, according to MoffettNathanson. 
Satellite TV providers such as DirecTV and Dish in particular have seen some of the highest pay-TV subscriber losses in recent years. While DirecTV no longer publicly reports its subscriber base, the company has about 13 million customers, according to analyst reports and one of the people familiar with the job cuts. 
DirecTV reportedly lost around 500,000 customers in its most recent quarter, according to ratings agency Fitch. Although DirecTV’s losses slowed during the height of the pandemic, they recently accelerated to nearly 17%, according to MoffettNathanson. 

In addition to satellite TV, the company also offers DirecTV Stream, an internet-TV bundle similar to Google’s YouTube TV and Dish’s Sling. 
Competition has ramped up in rural areas as broadband and fixed wireless companies build out networks in areas where satellite TV providers were once some of the only TV providers.
Meanwhile, fees to carry broadcast and cable channels continue to rise. Executives across the industry have cited rising fees as partly responsible for accelerating pay-TV customer losses in recent years.
Plus, media companies have been offering more of the content traditionally found on linear TV, such as weekly shows, live events and sports, on streaming services, further pulling value from the pay-TV bundle. 
DirecTV’s contract recently ended for the rights to the NFL’s “Sunday Ticket” package of out-of-market Sunday games. It held the rights since the inception of “Sunday Ticket” in 1994 and had been losing about $500 million annually on the package, CNBC previously reported. 
The impending layoffs include only a small portion of employees connected with “Sunday Ticket,” the people said. 

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Netflix will livestream this year’s SAG Awards on its YouTube channel on Feb. 26.
The streaming giant plans to air the awards show on its actual platform in 2024.
Netflix has been developing its own livestreaming technology, which it plans to launch in March with a new Chris Rock stand-up special.

Aaronp | Bauer-Griffin | GC Images | Getty Images

Netflix will exclusively air this year’s Screen Actors Guild Awards show in its first partnership with an awards show and its next step into live broadcasting.
The SAG Awards, which will take place Feb. 26, will air live on Netflix’s YouTube channel, but not the streamer’s own platform. Netflix aims to broadcast the awards show on its actual service in 2024, according to a company spokesperson.

The streaming giant plans to roll out its own livestreaming technology with a Chris Rock stand-up comedy special March 4, the company announced in December. It has been developing its own livestream service since May, as reported by Deadline.
“As we begin to explore live streaming on Netflix, we look forward to partnering with SAG-AFTRA to elevate and expand this special ceremony as a global live event in 2024 and the years to come,” said Bela Bajaria, Netflix’s head of global television, in a statement Wednesday.
Netflix’s venture into live broadcasting comes alongside a variety of new experiments as the company faces a stall in subscriptions. It reported last April that subscriber numbers had declined for the first time in a decade, which it attributed in part to subscribers sharing their passwords with nonpaying users, as well as macroeconomic factors such as inflation.
To address the plateau, Netflix in November rolled out a new ad-supported streaming tier as a cheaper option for subscribers, despite previous resistance to advertising on the platform. Co-CEO Reed Hastings has also said the company would consider adding live sports after the success of its Formula One “Drive to Survive” documentary series.
Since 2007, the SAG Awards has aired on both TNT and TBS, channels owned by Warner Bros. Discovery. TNT has aired the event since 1998. Warner Bros. Discovery parted ways with the SAG Awards in May as the newly merged company restructured.
As awards shows struggle to boost ratings on traditional television broadcasts, other streaming platforms have been eyeing the possibility of scooping them up. Amazon Prime streamed the Country Music Awards for the first time in 2022 and plans to do so again this year.

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The first mission by ABL Space got off the ground, but its RS1 rocket suffered an issue that caused it to fail shortly after lifting off.
ABL President Dan Piemont told CNBC that the rocket damaged the launch pad.
“We hoped to fly a bit farther today, but … [the] Flight 2 vehicle is fully assembled and we’re excited to make the necessary pad repairs and get back to it,” Piemont said.

The company’s RS1 rocket lifts off on its inaugural launch attempt from Kodiak, Alaska on Jan. 10, 2023.

The first mission by ABL Space got off the ground on Tuesday, but the company’s RS1 rocket suffered an issue early in the flight that caused it to fail shortly after lifting off.
ABL President Dan Piemont told CNBC that the RS1 rocket stayed within the predefined “acceptable flight corridor” during the short launch, but after the rocket’s engines shut down the vehicle “impacted directly on the launch pad,” causing damage.

The cause wasn’t immediately clear, and the company will be joined by the Federal Aviation Administration and Alaska Aerospace, which operates the Pacific Spaceport Complex on Kodiak Island, Alaska, in investigating the mishap and assessing the damage.

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“We hoped to fly a bit farther today, but we prepared for and accepted the risk of any outcome including a failure on the pad. The Flight 2 vehicle is fully assembled and we’re excited to make the necessary pad repairs and get back to it,” Piemont wrote in a response to CNBC on Wednesday.
ABL’s RS1 rocket stands about 90 feet tall, and is designed to launch as much as 1,350 kilograms (or nearly 1.5 tons) of payload to low Earth orbit — at a cost of $12 million per launch. That puts RS1 in the middle of the commercial launch market, between Rocket Lab’s smaller Electron and SpaceX’s heavy class Falcon 9.
The company has raised $420 million to date, with a $2.4 billion valuation as of its most recent fundraising in October 2021, from investors including T. Rowe Price, Fidelity, and Lockheed Martin Ventures. Its goal has been to reach orbit with RS1 spending less than $100 million.
ABL’s failure to reach orbit is a further example of the high risk in the development and early flights of an orbital rocket, which has been particularly challenging for companies targeting the small- and medium-weight classes of the market.

On Monday, Virgin Orbit’s sixth mission also suffered a mid-flight anomaly, and Astra has been grounded since its most recent flight last year ended in failure and it pivoted to developing a new rocket.
Firefly Aerospace reached orbit for the first time on its second flight attempt in October, and even Rocket Lab — the current leader in the small launch category after a flawless 2022 — has had its shares of launch failures over the past few years.

The company’s RS1 rocket stands in preparation for launch from Kodiak, Alaska.

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The Economist is looking to hire a global business writer, ideally based at first in London. The writer will be expected to provide thematic features that range across industries and geographies. Examples of recent thematic coverage are below. The job includes writing leaders and appearing on podcasts, films and at Economist events. Journalistic experience is not necessary. The ability to write clearly and entertainingly is crucial, as are strong analytical skills, a high degree of financial numeracy and an ability to work with data. To apply, please send a CV and a sample article, suitable for publication in The Economist, to: [email protected]. It should be unpublished and no longer than 700 words. The deadline is February 25th.Example coverageWhy businesses are furiously hiring even as a downturn loomsMultinational firms are finding it hard to let go of ChinaWhat big tech and buy-out barons have in common with GEA sleuth’s guide to the coming wave of corporate fraudWhat went wrong with Snap, Netflix and Uber? More

The Federal Aviation Administration suffered an outage of the system that sends messages to pilots.
The FAA ordered airlines to pause domestic departures.
“There is no evidence of a cyberattack at this point, but the President directed DOT to conduct a full investigation into the causes,” the White House said.

Shannon Stapleton | Reuters

Thousands of U.S. flights were delayed Wednesday morning after the Federal Aviation Administration suffered an outage of the system that sends messages to pilots.
The FAA said on its website that domestic departures would be paused until 9:30 a.m. ET. The agency said it was working to restore the Notice to Air Missions System. All flights currently in the air were safe to land, the agency said.

More than 3,500 U.S. flights were delayed on Wednesday as of 8:20 a.m., according to FlightAware. Once the ground stop is lifted, residual delays could last hours from the backup.
“This technology issue is causing significant operational delays across the National Airspace System,” said Airlines for America, an industry group that represents major U.S. carriers, including Delta, American, United, Southwest and others.
The White House said Transportation Secretary Pete Buttigieg had briefed President Joe Biden on the outage. “There is no evidence of a cyberattack at this point, but the President directed DOT to conduct a full investigation into the causes,” White House press secretary Karine Jean-Pierre said in a tweet.
The incident comes just weeks after bad weather during the busy holiday travel period prompted mass flight disruptions across the U.S. and days later, more than 15,000 Southwest Airlines flight cancellations after the carrier buckled from all the schedule changes.
Southwest is preparing to cancel flights on Wednesday to avoid further disruption, Casey Murray, president of the Southwest Airlines Pilots Association, told CNBC.

Shares of Southwest were about 1% lower in premarket trading Wednesday. Shares of other major airlines were little changed.
This is breaking news. Please check back for updates.

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The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) decreased last week to 6.42% from 6.58%.
The drop in rates sparked a 5% increase in applications to refinance a home loan.

A sign advertising home loan rates for purchase or refinancing at a Bank of America in New York.
Scott Mlyn | CNBC

After rising at the end of the year, mortgage rates dropped sharply last week. That drove demand from current homeowners hoping to save on their monthly payments, but it did little to excite potential homebuyers.
As a result, total mortgage application volume rose just 1.2% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) decreased last week to 6.42% from 6.58%, with points remaining at 0.73 (including the origination fee) for loans with a 20% down payment. One year ago, that rate was 3.52%.
“Mortgage rates declined last week as markets reacted to data showing a weakening economy and slowing wage growth. All loan types in the survey saw a decline in rates,” said Joel Kan, an MBA economist.
The drop in rates sparked a 5% increase in applications to refinance a home loan. Volume, however, was still 86% lower than the same week one year ago. Even with rates lower than their previous high of over 7% last fall, at the current rate just 270,000 borrowers could benefit from a refinance, according to Black Knight, a mortgage technology and analytics firm. A year ago, with the rate half what it is now, roughly 7 million borrowers could benefit.
Mortgage applications to purchase a home fell 1% for the week and were 44% lower than the same week one year ago. That was the lowest reading since 2014. Buyers today are not only contending with higher interest rates but falling supply. They are also seeing prices come down and may be waiting to see how low they go.
So far this week mortgage rates have moved in a narrow range. The market is eyeing the next release of the monthly consumer price index set for Thursday. If it shows inflation to be cooling even more, mortgage rates could drop further.

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Transworld Penguin Random House said 400,000 copies sold on the first day it was officially released, after copies of the book were mistakenly up for sale in Spain on Jan. 5.
The book contains intimate details about the Duke of Sussex’s personal life, as well as revelations about the wider royal family, including King Charles III.

Prince Harry’s memoir “Spare” became the fastest selling non-fiction book ever in the U.K. on its release day, its publisher said Tuesday.
Chris Jackson / Staff / Getty Images

LONDON — Prince Harry’s memoir “Spare” has become the fastest selling non-fiction book ever in the U.K., according to its publisher.
After the book’s official release Tuesday, 400,000 copies have been sold so far across hardback, e-book and audio formats, Transworld Penguin Random House said, citing British sales figures.

“We always knew this book would fly but it is exceeding even our most bullish expectations,” the publishing house’s Managing Director Larry Finlay said in a statement.
“As far as we know, the only books to have sold more in their first day are those starring the other Harry (Potter),” Finlay added.
The biography includes details about the prince’s personal struggles, such as losing his mother, Princess Diana, aged 12, as well as frictions with fellow royals, including his father, King Charles III, stepmother Camilla and older brother Prince William.
“Spare” is available in 16 languages, and ranks as the best-seller on Amazon websites across the world, including in the U.K., U.S., Germany, France, Italy, Spain, Australia and Saudi Arabia at the time of writing.
Copies of the intimate memoir were mistakenly released in Spain five days before the official publication, prompting much of its contents to make headlines across the world.

Harry also gave several interviews ahead of the book launch, doubling down on claims that some royals leaked damaging stories to the tabloid press about him and his wife Meghan in order to protect their own reputations.
The royal family has not commented on the book or any of the interviews given by Prince Harry.

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South Korea on Tuesday hit back at claims that its Covid rules for Chinese travelers are “discriminatory,” saying more than half of its imported cases are coming from China.
In a response to CNBC, Seung-ho Choi, a deputy director at the Korea Disease Control and Prevention Agency said that up to 80% of “imported confirmed cases” in South Korea are coming from China.

Choi said the number of people traveling from China who tested positive for Covid-19 went up 14 times from November to December.
Choi also said that its policies cover “all Korean nationals and non-Korean nationals coming from China. This is not confined only to Chinese people. There is no discrimination for nationality in this measure.”
Citing South Korea’s proximity to China, Choi said a surge in infections in China could put South Korea at risk.

“China’s COVID-19 situation is still worsening …which has created the possibility of new variants to be detected,” he said.
The omicron variant swept China in December, after authorities relaxed stringent contact tracing requirements that had forced many people to stay close to their homes for nearly three years. As of Jan. 8, Beijing formally relaxed its international border controls, opening the door to more travel in and out of the country.

It’s unlikely that a dangerous new Covid variant is spreading in China, Dr. Chris Murray, Seattle-based director of a health research center at the University of Washington, told CNBC in late December. 

China halts visas

More than a dozen countries have announced new rules for travelers departing from China. Most are requiring travelers departing from China to test negative for Covid before arriving — the same requirement China has for international travelers to the mainland.
But South Korea and Japan — two top destinations for Chinese travelers — said they are not increasing flights in response to China’s border reopening. South Korea also announced plans to limit short-term visas to travelers from China.
China’s embassies in South Korea and Japan announced Tuesday that they would stop issuing visas to “Korean nationals” and “Japanese citizens.”

Thai officials welcome Chinese passengers at Bangkok’s Suvarnabhumi Airport on Jan. 9, 2023.
Rachen Sageamsak | Xinhua News Agency | Getty Images

The announcement by the Chinese Embassy in Korea said the rule would apply to visas for tourism, business and medical reasons, and that it was “following China’s domestic guidelines,” according to a CNBC translation.
“China firmly rejects a handful of countries’ discriminatory entry restriction measures targeting China and will take reciprocal measures,” Ministry of Foreign Affairs spokesperson Wang Wenbin said Tuesday. 

‘Lack of transparency’

South Korea’s Choi said that policy decisions came after “in-depth discussions with relevant government ministries and experts.”
Noting that the “Chinese government stopped publishing data on daily confirmed cases,” Choi said the measures were “inevitable.”

U.S. State Department spokesperson Ned Price said at a press briefing Wednesday that the United States is requiring that travelers from China take pre-departure tests because of the “spread” and “prevalence” of infections in China, “but also because of the lack of adequate and transparent epidemiological and viral genomic sequence data being reported from the PRC.”
“It’s the lack of transparency that has compounded our concern for the potential for a variant to emerge in the PRC and potentially to spread well beyond its borders,” he said.

‘Very fair’

As a responsible member of the international community, we will share with the world the Covid-19 data that we are analyzing.

Seung-ho Choi
Korea Disease Control and Prevention Agency

Yet a Shanghai-based finance professional, who asked that we refer to him as Derek, called South Korea’s restrictions “very fair.”  
“None of my friends would go on a flight filled with Covid positive people,” he said.
Chinese citizen Cheryl Yang said for many in China, travel is the least of their concerns.
“Many people I know have been sick or [are] sick, and a lot of kids are off school,” she said. “Travel would be a secondary problem at the moment.”

‘Only temporary’

Choi said South Korea’s new Covid travel restrictions are “only temporary” and were made to “place the highest priority on the health and safety of people residing in South Korea.”
The surge of Covid infections sweeping across China may mean the country can quickly move past the outbreaks, allowing the economy to rebound quickly — some say, as early as the second quarter of 2023.

Read more about China’s reopening

Noting that China’s reopening is progressing faster than most expected, a report by HSBC Global Research published Jan. 5. stated that “China will emerge from Covid-19 and rebound strongly from 2Q23.”
In the meantime, Choi said, “We will make the utmost effort to help the world overcome the pandemic.”
“As a responsible member of the international community, we will share with the world the Covid-19 data that we are analyzing,” he said. More