AT&T reportedly plans to introduce a new, inexpensive live streaming service that contains no sports content and will be offered to the carrier’s wireless subscribers for free.
The reports, later confirmed by spokespeople, came from multiple people watching as AT&T CEO Randall Stephenson testified Thursday during the ongoing antitrust trial over its pending merger with Time Warner.
AT&T Watch, as the over-the-top service is called, will launch in coming weeks and cost $15 per month for anyone not subscribing to an AT&T wireless plan, according to Washington Post reporter Brian Fung.
Wells Fargo Senior Analyst Jennifer Fritzche wrote in a research note Friday that AT&T’s ultimate goal is likely to up-sell those wireless customers to costlier plans once they become used to the service and want more offerings.
“If successful, we believe this could put more pressure on the other three [major] wireless carriers … to act in a more formal way in the content space,” Fritzsche wrote.
AT&T, T-Mobile and Sprint already offer some form of content – HBO, Netflix and Hulu, respectively – bundled with their wireless plans.
Verizon is the only carrier without such an offering, but Fritzsche noted the company still reported record-low handset churn of 0.77 percent in the fourth quarter. In February, Verizon CFO Matt Ellis indicated that the company’s Oath media unit is more focused on investing in digital distribution rights than the growing trend of owning content.
As CNN pointed out, AT&T had suggested it would launch a low-cost service that would be free to wireless customers in a pre-trial brief.
“The merger will enable AT&T to transform the mobile video marketplace by combining Time Warner’s content assets with its wireless platform to develop new and more valuable services especially for mobile video devices,” the brief said. “For example: AT&T would launch a new service with Turner and a small number of popular cable networks, which would be made available for free to AT&T’s wireless customers on unlimited plans and for a nominal price to anyone else.”
AT&T hasn’t detailed what content would be offered on the new service, though it would cost significantly less than its OTT TV service DirecTV Now, which starts at $35 per month.