AT&T is overhauling its DirecTV Now pricing and packaging strategy — including hiking prices for existing customers by $10 across the board — a move that could lead to more subscriber losses for the company’s flagging pay-TV business.
At the same time, AT&T is launching two new DirecTV Now packages: Plus, at $50 per month for up to 46 channels; and Max, $70 per month for up to 59 channels. Both include AT&T-owned HBO, HBO Family and HBO Latino along with networks from WarnerMedia (Turner), NBCUniversal, Disney and Fox, and exclude channels from A+E Networks, AMC Networks, Discovery and Viacom.
The previous DirecTV packages are no longer available to new customers.
In a notice to customers posted Wednesday, AT&T confirmed that the prices of all DirecTV Now base packages will increase by $10 per month effective April 12, 2019. It’s the second price increase for DirecTV Now in less than a year, after the telco jacked up the prices by $5 per month last summer. Customers with those packages — Live a Little, Just Right, Go Big, Gotta Have It, and the Spanish-language Todo y Más — will retain their current lineups as long as they continue to keep the service.
Also, starting March 13, 2019, DirecTV Now legacy customers will pay $15 per month for HBO and $11 monthly for Cinemax (both previously offered for $5) while Starz will cost $11 per month (previously $8). The Brazilian package is increasing to $30 per month and the Deportes add-on is increasing to $15 a month.
The new DirecTV Now Plus $50 entry-level package includes HBO, HBO Family and HBO Latino and local ABC, CBS, Fox, CW and MyNetworkTV stations (though broadcast nets are not available in all markets). Cable networks in the bundle are AccuWeather, AT&T’s Audience, Boomerang, Bravo, Cartoon Network, CNBC, CNBC World, CNN, Disney Channel, Disney Junior, Disney XD, E!, ESPN, ESPN2, Fox Business Network, Fox News Channel, Fox Sports 1, Freeform, FX, FX Movie Channel, FXX, Hallmark Channel, HLN, MSNBC, Nat Geo Wild, National Geographic Channel, NBCSN, Ovation, Oxygen, Pop, Revolt, Syfy, TBS, TCM, TNT, TruTV, Universal Kids and USA Network.
DirecTV Now Max ($70 per month) includes all those channels as well as Cinemax and sports networks ESPNews, ESPNU, BTN, CBS Sports Network, FS2, Golf Channel, Longhorn Network, MSG, MSG+, Olympic Channel, SEC Network and YES Network (with regional sports networks available only in certain markets).
“Both new packages provide slimmer, quality-driven content lineups at competitive prices and with no annual contract,” AT&T said in announcing DirecTV Now Plus and DirecTV Now Max. Customers who take the $50 Plus package can add Cinemax for $11 extra per month; Starz and Showtime are also available for an additional $11 per month each.
AT&T had argued that its takeover of Time Warner “will enable the merged company to reduce prices, offer innovative video products, and compete more effectively” against tech giants Facebook, Apple, Amazon, Netflix and Google. The telco made those claims in a court challenge by the Justice Department, which sought to block the merger on antitrust grounds. Last month, a U.S. Appeals Court upheld a previous ruling approving the AT&T/Time Warner deal.
For DirecTV Now customers on the older packages, the new prices effective April 12 will be: Live a Little (65+ channels) for $50/month; Just Right (85+ channels) for $65/month; Go Big (105+ channels) for $75/month; Gotta Have It (125+ channels) for $85/month; and Todo y Más (90+ channels) for $55/month.
Word of the price hikes for legacy DirecTV Now packages and the two new bundles leaked out this past weekend, after AT&T posted preliminary info on its website.
While AT&T’s DirecTV Now shakeup stands to make the over-the-top service more profitable on a per-subscriber basis, the higher prices are bound to cause many users to bail — and switch to rival OTT live TV packages like YouTube TV, Hulu With Live TV or Dish Network’s Sling TV. In the fourth quarter of 2018, DirecTV Now lost 267,000 net subscribers after the company ended virtually all promotional pricing, and ended 2018 with about 1.6 million DirecTV Now subscribers.
Meanwhile, AT&T’s WarnerMedia is gearing up to launch a suite of subscription VOD services, centered on HBO, Turner and Warner Bros., targeted for a Q4 2019 launch.