AT&T to Marry Nationwide Wireless and TV Service, but Who Will Subscribe?

Douglas A. McIntyre

As AT&T Inc. (NYSE: T) clinches its purchase of DirectTV, it will achieve one of the long-terms goals of the content delivery world: one bill, one complete set of wireless broadband and TV, and all nationwide. In a world of almost infinite choices of 4G, cable, fiber and services like Netflix Inc. (NASDAQ: NFLX) that operate outside the traditional services, AT&T’s expensive M&A work will be tested.

AT&T announced:

AT&T will deliver the first-ever nationwide package of TV and wireless services — all from a single provider on one bill, with special discounts — beginning Aug. 10. The offer includes HD and DVR service for up to four TV receivers, unlimited talk and text for four wireless lines, and 10GB of shareable wireless data – all for $200* per month, an annual savings of $600 or more in the first 12 months. AT&T is the only single provider that can deliver nationwide TV and wireless services with one point of contact for customer care on a single monthly bill.

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As part of this launch on Aug. 10, and for the first time nationwide, new DIRECTV subscribers will have immediate access to programming — on their mobile devices via a walk out and watch TV experience — at point of sale. They can view it on their compatible mobile devices after leaving the store before TV service is installed. The walk out and watch feature will be delivered through the DIRECTV app and customers will have a limited time to activate their mobile TV service. AT&T sales representatives will assist customers to set up the app on their wireless device in the store.

AT&T is now selling DIRECTV in more than 2,000 AT&T retail stores nationwide — integration built around customer convenience and simplification.

The combination is both simple and, by the measure of what most consumers have been offered for years, elegant.

Not only does AT&T have to fight other wireless carriers that offer half of this service and other companies that offer other pieces. It has to battle whether consumers want a “one size fits all” offering. Only within the past two or three years have consumers elected to use “unbundled” services, which allow them to use broadband to bypass traditional TV and cable content to build their own series of channels, custom made for them depending on their content preferences. The brand new AT&T service undermines this opportunity.

Perhaps consumers would prefer several bills, one of which is for broadband and other others that are for a series of channels that might include Netflix and individual channels like the one that Time Warner Inc. (NYSE: TWX) released called HBO Go.

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