AT&T’s long-awaited streaming television product, DirecTV Now, will give customers access to 100 live streaming television channels and on-demand content without any hardware, contracts, credit checks, or installation. And the price starts at $35 a month.
AT&T announced the product, which will be available on Nov. 30, at a launch event Monday. The product provides an alternative way to access streaming TV, and licensed and original content on any mobile device using any network. It’s an offer the company expects will particularly appeal to those who cut the cord or never opted in to traditional cable services. DirecTV Now also represents a new milestone for the company, which has now combined operations from five platforms into one.
“For the first time in history, we have control of the full stack,” said John Stankey, CEO of Entertainment at AT&T, who called the release bigger than that of their U-verse offering announced in 2005. “That puts us in a unique position as we evolve products over time.”
The new product offers customers access to content from providers including Fox, Discovery, Bloomberg, Viacom, Disney and ESPN, and HBO. It’s still missing CBS and Showtime, with which the company says it’s still working on obtaining contracts. The product has three price points ranging between $35 for 60-plus channels and $70 for 120-plus channels.
As part of the launch, AT&T is offering an introductory price of $35 for the Go Big package, which normally will be priced at $60. Customers will be able to grandfather that price moving forward. The company is also offering several other promotional deals, including a free Apple TV, for customers who prepay or buy a TV from its partner LeEco, a smart TV provider AT&T says it plans to integrate further with in the future.
So, what does all this mean for the Dallas-based company?
First, it’s plunging headfirst into streaming video, aiming to attract customers it previously left behind: those with bad credit, those not interested in contracts, those looking for mobile streaming offers. And that could mean a significant boost right off the bat. Brad Bentley, executive vice president and chief marketing officer of AT&T’s Entertainment and Internet Services, says that the company turns away millions of people interested in DirecTV due to credit checks. Meanwhile, the company says that 20 million households have dropped cable or don’t subscribe to premium pay-TV.
It also means the company will be taking on some big competitors already in the space. Some of the clear direct competitors include Amazon Prime Instant Video, SlingTV, PlayStation Vue, and soon Hulu, which announced plans to stream live TV earlier this year. But AT&T is hoping to combat them with AT&T original content like ICE, which premiered in November; Taylor Swift Now, unique content from the recording artist that will be exclusive to DirecTV Now; content from Hello Sunshine, a female-driven production company led by movie star Reese Witherspoon; and programming from Fullscreen, a company that targets millennials with content from social media stars.
DirecTV now uses a layout similar to what you might expect from Netflix—allowing its viewers to see what’s new, continue watching, view by category, or opt into one of the recommendations the application will make based on the viewer’s previous selections. It will be available immediately on iOS and Android devices, and can be streamed via Amazon FireTV, Chromecast, or Apple TV. A few weeks after launch it will be available on Roku. This could push its competitors to start rolling out new offers so they don’t get swallowed up by the giant, or they could begin to carve out their own niches in entertainment, assuming DirecTV Now is successful.
And if the company indeed follows the plan, new innovations could be rolling out in the future, personalizing the experience even further. With all of the data sets combined onto one platform, AT&T says the DirecTV Now application is just the beginning. Stankey said the company is already working on additional features and other products that could be used with this new ecosystem. Enrique Rodriguez, chief technical officer for Entertainment and Internet at AT&T, expects to be able to shift into a new gear shortly. “Within the next months and the next quarters … many of the experiences will be on this same platform,” he said. “It will all be under a single set of data and advertising.” And that means even the advertising will be more personalized, as it will leverage the user data in order to provide more relevant ads. Advertising across AT&T already represents $2 billion of its business, Bentley said.
Since acquiring DirecTV for $48.5 billion in 2015, AT&T has been aiming to push the boundaries of what a media and entertainment company could be. One of AT&T’s very first announcements after the acquisition was a video that teased a TV-Everywhere experience that would provide mobile access to all types of content. The company has now created a phrase around this idea, with the release of DirecTV Now: Let Freedom Stream. This product will likely only get stronger if the Time Warner acquisition is completed. AT&T agreed to buy the media company for $85.4 billion in October, but the deal is still subject to regulatory approval. How would the product change with Time Warner in the mix? It’s too soon to tell. But whether or not the Time Warner deal gets done doesn’t change AT&T’s plan for the new offering.
“This is our first iteration,” Stankey said. “Because it’s a software-based product, there’s more to be done. This is the foundation for how we’re going to do things in the future.”
