AT&T revealed details of a new mobile streaming service which eschews sports channels in favour of a lower price tag, as it seeks to stay one step ahead of its competition.
During testimony in a trial related to its acquisition of Time Warner, AT&T CEO Randall Stephenson said the AT&T Watch service will cost most users $15 per month, but noted AT&T will offer the service for free to its unlimited wireless customers.
Trial documents revealed the service will include channels from Time Warner’s Turner property, along with “a small number of popular cable networks”. It is expected to be launched in the next several weeks.
Stephenson used AT&T Watch as an example to prove the operator’s purchase of Time Warner won’t stand in the way of continued innovation in the video space. But he also noted the deal is part of AT&T’s bid to stay ahead of the curve in a rapidly changing media environment which has led to a content arms race among wireless operators in the US.
Some, including AT&T and Verizon, sought to buy up media companies to produce their own content, while others including T-Mobile US and Sprint initially went the partnership route, striking deals with Netflix and Hulu, respectively.
T-Mobile upped the ante when it decided to buy Layer 3 TV in December 2017 and announced plans to launch its own streaming service in the future.
AT&T launched its first mobile-focused streaming service, DirecTV Now, in November 2016, offering packages ranging from $35 per month to $70 per month. The operator reported the service racked up 1.2 million subscribers in 2017.
But Wells Fargo senior analyst Jennifer Fritzsche said AT&T’s introduction of another more aggressive, lower-priced offering could “put more pressure on the other three wireless carriers to act in a more formal way in the content space”.
Recon Analytics founder Roger Entner agreed, noting in a Twitter post AT&T’s play will make it more difficult for the competition to fight back without seeming reactionary: “Not sure how T-Mobile can respond to that with their upcoming streaming TV offer after the Layer3 TV acquisition. Imitate the AT&T offer of free TV and call it a victory? Offer people money to take it?”