AT&T has just let the cat out of the bag, regarding the DIRECTV NOW price hikes. It is now offering up two new plans which include DIRECTV NOW PLUS & MAX which are going to be $50 and $70 per month. AT&T has given very little details about these new plans so far, but more details will be available tomorrow when they actually launch.
With both of these new DIRECTV NOW packages, AT&T is bundling HBO for free. Not a huge surprise, since AT&T does own HBO and does want as many people watching that content as possible. HBO does also have a ton of on-demand movies and TV shows available, so there will be plenty of content to watch. AT&T says that both "new packages provide slimmer, quality-driven content lineups at competitive prices and with no annual contract." While not confirming it, that essentially means that AT&T is stripping down the number of channels available in these packages.
The DIRECTV NOW MAX plan is going to offer more "live sports channels, video-on-demand choices, and HBO and Cinemax included.
In its press release, AT&T is stating that customers can opt to keep their current plans and simply pay $10 more per month, or "upgrade" to these newer plans. Of course, it is not releasing the channel lineups just yet, so it's hard to gauge which will be the better plan. That information will be coming out tomorrow, when these plans are actually available.
This price hike comes after AT&T told regulators that it would not raise rates, if the Time Warner merger was approved. Of course, the last price hike for DIRECTV NOW happened the day after that merger was finalized, so this should be no surprise. But it just shows that AT&T had no plans to keep prices somewhat low, when it comes to DIRECTV NOW. Where AT&T now owns a lot of the channels that it offers on DIRECTV NOW, like HBO and CNN, it means that AT&T is actually making more money on its streaming service, versus paying a lot of it out through licensing fees.
Of course, this is also going to fuel the conspiracy theorists stating that streaming TV does cost more than a regular old cable box or a satellite dish. And at this rate, they may be right. With AT&T not only raising rates, but also dropping some channels, it means that DIRECTV NOW customers will be getting less value for their money. With plans starting at $50, DIRECTV NOW now starts at more than just about every other streaming service. That includes YouTube TV, Hulu Live TV and even PlayStation VUE.
Recently, it was made public that it lost 267,000 subscribers in the previous quarter, compared to the quarter before that. With a total of 1.6 million customers. And now with the prices going up once again, it wouldn't be a huge surprise to see DIRECTV NOW continue to lose customers. And that goes along with the fact that its Pay TV subscribers are also dropping, there was around 38.4 million at the end of Q4 2018, compared to 38.9 million in the same period a year prior. For a company that is prioritizing video, things aren't looking to great right now.