Over the past few months there’s been increased speculation surrounding the future of DIRECTV NOW and how AT&T views the product nowadays.
Today, during comments given by AT&T’s President of Mobility and Entertainment, David Christopher, at the Bank of America Merrill Lynch Conference, we got a slightly better understanding of AT&T’s viewpoint on DIRECTV NOW.
In short, DIRECTV NOW is not the company’s priority and it seems that is unlikely to change in the future.
Based on the comments given, Christopher appeared to be far more focused on the non-NOW side of the DIRECTV business, including when it comes to streaming.
Due to this greater focus Christopher was asked where DIRECTV NOW fits in today, and in particular following what has clearly become a period of lost momentum for the live TV streaming service.
In response to this, Christopher basically explained that DIRECTV NOW is what it is and that’s a product aimed at consumers who are “more price-conscious" and "don't want contracts.”
Following up the comments, Christopher also stated that AT&T now emphasizes “it slightly less” than before because the company is “focused more on other elements of the portfolio.”
Christopher did explain DIRECTV NOW is part of the wider portfolio and therefore has its place, but the general consensus of the comments seemed to be we’ve launched it and now we’ve moved on. There was little to no enthusiasm in the comments and that seems to be representative of AT&Ts overall view of DIRECTV NOW.
In fact, the only excitement shown was when referencing the recent price hikes. On this point, Christopher stated “we're really pleased with the new products that we launched, the 2 new price points,” further adding the goal of the price increase (and presumably the third-party channel decrease) was “to get the content and the revenue more closely aligned.” In other words, “so it is more profitable.”
Arguably, these comments are unlikely to be well received by users of the NOW service as they build upon a collection of comments made by the company recently which point to AT&T viewing the product as a lesser product compared to its other video solutions.
For example, it wasn’t that long ago that another AT&T executive looked to gloss over what appears to be a recent DIRECTV NOW subscriber exodus by suggesting the subscriber losses were all part of AT&T’s plan. That AT&T was currently in the process of a DIRECTV NOW “customer cleanup.” An exercise that was also designed to make the service more profitable by focusing on what AT&T referred to as “high-quality” customers." Essentially, those who pay more.
DIRECTV NOW is operating in a highly competitive space at the moment and although each of the competing services have their shortcomings, Hulu with Live TV, Sling TV and YouTube TV have all been trying to talk extremely positively of their respective services. In fact, Hulu and YouTube have both been extremely aggressive when it comes to the positive marketing of their services, while Sling TV is constantly running various promotions that offer even better value than they do already as an affordable live TV streaming option.
The moves of these other services acutely highlight how important they are viewed by their respective parent companies, and further highlight how that viewpoint is in contrast to AT&T who has upped prices, decreased the channel selection, and seems more than happy to continually talk in a non-interested manner when the topic of DIRECTV NOW comes up.