AT&T has said time and again that it is working on launching new web video services thanks to its acquisition of DirecTV last year. However, despite claims that the new services will be up by the fourth quarter, the operator hasn't disclosed basic details like cost of the services or which channels will be available in its upcoming packages. Back in July of last year, AT&T spent a whopping $49 billion to acquire DirecTV, an acquisition which made it the largest pay-TV provider in the United States. This year, AT&T is planning to club its existing wireless services and TV services to enable a large number of existing subscribers to enjoy web video services. The operator is currently selling a range of integrated broadband, video, and wireless services which it says are performing well but are just precursors to three new web video services which will launch this year.
"We're seeing good momentum with our initial integrated wireless, video and broadband offers. We'll expand the integrated choices for customers in the fourth quarter when we launch our new video-streaming services," said Randall Stephenson, AT&T CEO and chairman. AT&T sounds optimistic despite the fact that the total number of its video subscribers went down by 54,000 in a single quarter, when other services like satellite and wireless performed better than expected. AT&T added 328,000 satellite subscribers and 1.8 million wireless subscribers in the United States in the first quarter alone. Compared to the first quarter of 2015 when it earned $32.5 billion in revenue, the operator earned $40.5 billion in revenue in the first quarter of this year.
Once AT&T launches its new web video services, it will fall in direct competition with other popular services like Netflix, Hulu and Amazon Prime Instant videos. As these services charge less than $10 a month for their basic subscriptions, AT&T will have to devise a strategy to offer new integrated services at competitive rates. At the same time, existing users will also need to be convinced why AT&T web video services will be better and if the content offered will be as diverse as those offered by existing low-cost streaming services. Since AT&T already has a bunch of content in its sack thanks to the acquisition of DirecTV last year, the operator will now need to focus on adding fresh content in its upcoming services to stay alive in the long run.