In the battle among traditional media and media delivery companies, AT&T Inc. (NYSE: T) has added a new weapon. It will be part of the launch of a new streaming media service that will carry a nominal fee for a large library of video content and will be shown without ads. The firm that has created the service is called Fullscreen. The product runs up against competition from Netflix Inc. (NASDAQ: NFLX) and Amazon.com Inc. (NASDAQ: AMZN), which also want to move the viewership of their content to as many devices as possible and have created their own programming to help.
Fullscreen believes its audience is younger Americans who are used to watching video over the Internet. Management said:
Targeting Fullscreen’s highly-engaged 13 to 30-year-old audience, the subscription service will feature more than 800 hours of content and will be available anytime, anywhere at http://www.fullscreen.com and via iPhone, iPad, select Android Phones and Chromecast for $4.99 per month. The service will be available for global purchase at the same price point with over 90% of the original content and a large selection from the content library.
AT&T will be a major supporter of the new service and will distribute it widely:
Fullscreen also announced that AT&T has signed on as the premier launch sponsor for the new service. AT&T will collaborate with Fullscreen to market and promote the service with special offers for AT&T’s more than 100 million video, mobile and broadband customers. Also, Fullscreen and AT&T will co-produce premium content that will air both on fullscreen SVOD and on a Fullscreen programming block on AT&T’s AUDIENCE Network, available to DIRECTV and U-verse TV subscribers.
AT&T faces the challenge of tethering together its video delivery services into a single offering. Its buyout of DirecTV places it at the center of satellite connected video. This industry has faced slower growth due to cable and fiber video to the home, as well as the use of smartphones as video players. AT&T’s fiber to the home play is U-verse, which competes directly with traditional cable companies. The huge telecom company also needs to take a large portion of the time people consume media on smartphones.
In the rush to move video consumption from traditional cable, AT&T wants to grab market share via the use of premium content. It gets to move into a very crowded field.