Further changes are coming to AT&T’s TV offerings. As Dade Hayes writes at Deadline, the company launched a new “AT&T TV” package in 10 markets Monday. That package will feature an over-the-top streaming package with a cloud DVR (with 500 hours of storage, as per Luke Bouma of Cord Cutters News) for between $60 and $80 a month (without internet access) on a two-year contract. And AT&T TV is expected to go nationwide later this year, and to become a big focus for the company. That’s as per comments AT&T CEO Randall Stephenson made on an earnings call last month, which Hayes cites:
“We have some really high expectations for this product,” Stephenson said. “We’re going to learn from the pilot, and then we’ll expand to more cities as we go through the year.”
…In Stephenson’s estimation, the new service is a more efficient way for the company to approach the pay-TV marketplace. “It literally takes the customer acquisition cost and cuts it in half,” he said on the earnings call. “And the beauty of that is that you can begin to address a fundamental problem with the current linear TV business, and that is the price point, but the content costs just continue to grow.”
It’s also notable that with this launch, AT&T has also officially flipped the switch on the previously-discussed renaming of no-contract streaming service DirecTV Now (one of the largest streaming services out there) to AT&T Now. That’s not entirely the same package as AT&T TV, and there will be some differences beyond just the channels (Bouma writes that AT&T Now will continue to function as DirecTV Now did, with 20 hours of cloud storage, no contracts and no required hardware, while AT&T TV will require at least one set-top box), but it’s part of a larger shift from the DirecTV branding to the AT&T branding.
That’s part of a larger change in AT&T and DirecTV offerings, too. DirecTV began selling self-installed boxes that use streaming instead of satellite technology earlier this year, and they’re moving away from the satellite model in general. They launched their final satellite in November 2018 and declared then that older ones won’t be replaced. And with DirecTV Now now rebranded, most of the corporate TV offerings are now under the AT&T label. From a branding perspective, that’s a far cry from the early days of AT&T’s DirecTV acquisition that saw them trying to convert Uverse customers to DirecTV customers.
As for the new AT&T TV package itself, details on its channel lineup and pricing are available on their website here. It seems like a package partway between AT&T Now and the traditional U-verse cable or DirecTV satellite offerings. It also plans to offer access to third-party streaming content you subscribe to within the same interface, plus a voice-powered remote (things we’ve seen before from competitor Comcast). And it comes with DVR storage that’s more comparable to past cable and satellite offerings than what we’ve seen from many streaming-only services.
More importantly from a business standpoint, AT&T TV presumably doesn’t come with the on-site technician installation requirements of the traditional offerings or with as expensive of equipment. That’s part of the customer acquisition costs Stephenson was citing, and if they can get new customers to shift to this approach, it may save them a lot up front. However, this does come with the multi-year contracts associated with past cable and satellite services. We’ll see how popular AT&T TV winds up being, and if and how it’s changed as the company goes from a selected markets rollout to national availability.