AT&T to Launch Low-Cost Streaming Service

By Drew FitzGerald 

AT&T Inc. plans to launch a "skinny bundle" of television channels without sports that will cost $15 a month, one of the lowest prices available for a nationwide streaming live TV plan.

The service, called AT&T Watch, was announced Thursday by Chief Executive Randall Stephenson, who used his time on the witness stand in a high-profile antitrust case to pitch the new plan.

AT&T Wireless subscribers would get the service free, Mr. Stephenson said. He didn't specify which channels it would include or when it would be available. The CEO said he hopes to launch the service in the next few weeks.

AT&T is in court to dispute the allegation that it will use its ownership of Time Warner Inc. to hurt pay-TV competition. Unveiling a low-cost plan helps the company's case. The company has proposed buying Time Warner for $85 billion.

As consumers have cut the cable cord and the smartphone market has matured, companies have been pushing streaming video services and bundling video with wireless plans. Dish Network's Sling TV has plans that start as low as $20 a month. T-Mobile US Inc. offers free Netflix to most wireless subscribers.

It isn't the first time AT&T's boss decided how to price a TV bundle. The company launched its first streaming video service, DirecTV Now, in 2016 for $35 a month, a decision that ate into its corporate parent's margins.

"We weren't originally contemplating launching with something quite so bold and compelling" before the launch, AT&T executive Devin Merrill said in testimony earlier in the trial in discussing the DirecTV Now service. "But it became clear that Randall Stephenson was leaning in and had an idea to launch boldly and weighed in on the price point for the number of channels."

The decision worked out in terms of scale. DirecTV Now had more than one million subscribers last year, helping offset subscriber losses from the satellite TV service. But the streaming service's success has come at the expense of its corporate parent's overall profitability.

Write to Drew FitzGerald at [e-mail]

(END) Dow Jones Newswires

April 19, 2018 22:34 ET (02:34 GMT)

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