Say goodbye to the “DirecTV Now” name.
Later this summer, AT&T will retire the name of the over-the-top TV service, first launched in December 2016, which will be rebranded “AT&T TV Now.” The change comes as the telco plans to launch test pilots in select markets of a new internet-streaming TV service, which called AT&T TV.
Both the AT&T TV and AT&T TV Now services will be accessed through the same AT&T TV app on either mobile devices or connected TVs.
“As we roll out this new experience later this summer, current DirecTV Now customers will also see a new name — AT&T TV Now — appear on their screen,” the company said in announcing the change. DirecTV Now subscribers will have to re-accept terms of service, logging in using the same username and password.
The change comes as AT&T’s overall pay-TV business has seen steep subscriber losses: For Q2, AT&T reported a 778,000 net loss in DirecTV satellite and U-verse TV customers — and it shed 168,000 DirecTV Now subs, which it said stemmed from price hikes and fewer promotional offers. In the last 12 months, AT&T has lost some 2 million traditional pay-TV customers, down 8.6% year over year, and DirecTV Now’s subscriber base has shrunk 26%.
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Meanwhile, AT&T is currently in the midst of contract fights with CBS and Nexstar Media Group, which has resulted in their channels dropping from DirecTV and U-verse.
AT&T hasn’t divulged pricing or packaging details for the new AT&T TV service, which will use a “thin client” internet set-top box. On the company’s Q2 earnings call on July 24, CEO Randall Stephenson said AT&T TV will slash customer-acquisition costs by 50% compared with the legacy DirecTV satellite service.
“The DirecTV [satellite] product is going to have a really long life,” he said. But the new AT&T TV service will deliver lower retail price points “and still have the same value equation from a customer standpoint.”
As he’s said previously, Stephenson characterized AT&T TV as the “workhorse” for the company’s pay-TV business over the next few years. “We will put our shoulder and our muscle behind AT&T TV, get a lower price point [and] shore up this customer base over the next couple of years,” he told analysts.
AT&T is revamping the OTT pay-TV portfolio as it preps for the launch of another new streaming service: HBO Max, a direct-to-consumer subscription video package that will include content from HBO and Warner Bros., reruns like “Friends” and “Pretty Little Liars,” original films and service — and, eventually, live news and sports, according to Stephenson. HBO Max is slated to debut commercially in spring 2020; AT&T has scheduled an investor briefing on HBO Max for Oct. 29.
“[A]s we come out of back end of 2019 and the customer base is cleaned up, we will have a customer base that is going to be perfectly suited for HBO Max,” Stephenson said.
The AT&T chief also said HBO had a “really strong second quarter,” with HBO Now digital subscriptions in particular gaining “a lot” of customers with the release of the final season of “Game of Thrones.” Stephenson didn’t provide HBO subscriber numbers but said that even with HBO unavailable on Dish Network (since last November) subscribers increased year over year.