Less than two weeks after AT&T (NYSE: T) closed its $48.5 billion deal to buy DirecTV (NASDAQ: DTV), it's crowing about its ability to do what no other U.S. wireless carrier can: sell bundled nationwide TV service. AT&T is offering a discount for its wireless customers to get them to sign up for DirecTV service and is throwing in credits and other benefits to sweeten the offer.
Starting Aug. 10, AT&T will offer a package that includes HD and DVR DirecTV service for up to four TV receivers, unlimited voice and texting for four wireless lines and 10GB of shareable wireless data starting at $200 per month. AT&T said this represents annual savings of $600 or more in the first 12 months. However, that price does not include the cost of monthly smartphone installment payments as part of AT&T's Next equipment installment plan. The offer ends Nov. 14.
"Today is the first of many planned moves to enable our customers to enjoy a premium entertainment experience almost anywhere," Brad Bentley, executive vice president and CMO of AT&T Entertainment and Internet Services, said in a statement.
AT&T's new "All in One" plans offer DirecTV service nationwide or several AT&T U-verse TV plans, which are available in 21 states. The TV plans range from $50 to $125 per month, and then also include the wireless service for an additional $160 per month.
Customers may add AT&T's wireless services, with 10 GB of shared data and unlimited talk and texting for four phone lines, for $160 per month. AT&T said that when combined on a single AT&T bill with the basic TV plan for $50 (DirecTV Select or U-verse U-Family), with service on up to four TVs, consumers will pay $200 per month for the All-in-One plan after a $10 a month combined bill discount.
So, while the $200 price point is for the "All in One" plan with the basic TV service package, customers who choose more expensive TV packages will be paying significantly more per month than $200.
Customers who combine TV services with eligible AT&T wireless services on a single monthly AT&T bill are eligible for the $10 combined bill discount. The discount will continue if the customer keeps both services on a combined bill, for an annual savings of $120.
Additionally, DirecTV and U-Verse TV customers who switch to AT&T wireless service from another wireless provider will receive a $300 bill credit when they buy a smartphone on AT&T Next and trade in an eligible smartphone, the carrier said.
AT&T also said it is now selling DirecTV service in more than 2,000 AT&T retail stores nationwide. AT&T said that starting Aug. 10 it is going to give new DirecTV customers immediate access to programming on their mobile devices via a "walk out and watch TV " experience at the point of sale. AT&T sales representatives will assist customers to set up the DirecTV mobile application on their wireless device in stores and start watching content before TV service is installed. AT&T said customers will have a limited time to activate their mobile TV service.
Cable companies and MSOs have long offered "triple play" service of home phone, Internet and TV service, but U.S. wireless carriers have been unable to match those bundles. Yet analysts and industry experts have also wondered if American consumers are willing to pay for bundles for TV and wireless service.
Bundles and so-called "quad play" offers are popular in some European markets but have not taken off in the U.S., in part because no carrier has been able to offer nationwide TV service until now. While telecommunications companies see the benefits of convergence and sending as much of their voice and video traffic as possible over common IP network architectures and reducing churn, consumer tastes are moving to OTT video and wireless and away from traditional pay-TV and landlines.
Verizon Communications (NYSE: VZ) has the capability to offer quad-play services but does not push the offer. "It is very difficult for some reason in the U.S. to sell a quad play," Verizon Communications CFO Fran Shammo said at an investor conference last September. "Consumers buy TV and they buy wireless, and they don't think about really combining the two."
- see this release
- see this AT&T page
- see this Re/code article
- see this CNET article
Lowenstein's View: What should AT&T do now that it owns DirecTV?
AT&T closes DirecTV purchase: Stankey in charge of new 'Home Solutions' operation, White retires
FCC poised to approve AT&T-DirecTV deal, create top pay-TV service in the U.S.
AT&T-DirecTV deal gets approval from FCC's Wheeler, with conditions
T-Mobile/Dish deal could create a new bundle, but consumer interest might be tepid
Analyst: Dish/T-Mobile merger would be 'Pugs Bunny,' a mismatched mix of a pug and a rabbit