AT&T formally rolled out its new Internet-based streaming TV service on Monday with an eye-popping price tag of $93 a month.
The price for AT&T’s basic subscription to the service makes it considerably more expensive than similar offerings from Google, Disney, Dish Network and others.
For $93 a month, customers get access to 70 basis cable channels, including ESPN, Comedy Central and CNN, the latter of which AT&T owns through its acquisition of WarnerMedia in 2018. Customers also receive one Android-powered set-top box that gives streamers access to thousands of third party apps in Google’s Play Store (each additional box is available for a premium price — more on that later) and 500 hours of cloud-based DVR storage for movies and TV shows, though recordings expire after three months.
AT&T is offering customers who want more channels two other tiers of service: a $110 a month plan that includes the Sundance Network, Tennis Channel and MLB network, and a $124 a month package that includes the Golf Channel, FXM and National Geographic Wild. Both tiers include regional sports channels, which comes with a separate $9 a month fee that customers must pay.
AT&T is offering new customers a promotional price that brings the cost of its cheapest plan down to $50 a month — but the price is only good for 12 months, and customers must sign a two-year contract. In that second year, the price increases to the normal $93 a month rate for basic service.
AT&T is also giving new customers three months of HBO, Cinemax, Showtime, Starz and Epix for free, but the price adds an extra $54 a month for all five movie packages if a customer doesn’t call and cancel before the end of the third month — which means, even with the discounted price, customers could wind up paying over $100 a month for service, even when they’re in their promotional period, if they don’t call to cancel those freebies.
Taxes and fees are not included in any subscription price.
AT&T TV requires a broadband Internet connection to work, which a customer has to pay for separately. AT&T TV customers can bundle their television service with AT&T’s fiber Internet offerings if it’s available in their area, though in most cases they’re still required to sign a contract committing to a certain term length for both services.
A promotion running on AT&T’s website in California offers new customers the option to pay for AT&T TV and AT&T high-speed Internet at a combined cost of $80 a month for the first twelve-months with a two-year commitment to AT&T TV. That cost doesn’t include an equipment fee of $10 a month, which presumably is the cost of a combined modem/wireless router needed to access AT&T’s fiber Internet service. After taxes and fees, the combined cost of both services easily tops out at over $100 a month, and it goes up another $40-60 a month after the first year of service (though customers can apparently cancel the Internet part of the bundle if they want).
It’s not clear if AT&T’s wireless customers receive a discount for bundling AT&T TV service with their existing plan. A spokesperson has not yet returned an email from The Desk seeking comment. AT&T previously offered wireless customers discounted access to AT&T TV Now, it’s first Internet-based streaming service, and free access to Watch AT&T, a slimmer Internet-based TV service.
AT&T faces a hard sell on its new Internet-based streaming service. Competing services, including YouTube TV ($50 a month), Fubo TV ($55 a month), Philo ($20 a month), Hulu with Live TV ($55 a month) and Sling TV ($35 a month), offer nearly all of the same channels as AT&T TV, don’t require extra payment to cover taxes and fees, and charge customers drastically less than the cost of AT&T TV. None of AT&T TV’s competitors have promotional pricing either — the price customers see is the price they pay.
AT&T said its new streaming TV service was built with customers in mind. “Our customers told us what they want from their TV service and we built AT&T TV around that,” Thaddeus Arroyo, AT&T’s chief executive of the company’s consumer division, said in a press release. “AT&T TV is live TV made easy and when you add AT&T TV to our amazing 1 gigabit AT&T Internet you can’t go wrong.”
The company appears to be leaning heavy on its Android TV box, which includes the Google Assistant and enables customers to easily search for shows and movies across different applications, including AT&T’s own.
But the Android box alone may not be enough to sell customers: While the first box is free, each additional one costs a whopping $120 per box — three times the cost of a basic Amazon Fire TV stick and four times the cost of a basic Roku box, both of which have many of the same features as AT&T’s Android TV-powered box. Amazon integrates natively with Echo devices, which customers may favor if they’re already prone to asking Alexa for help or advice; Roku devices work with Google Assistant-powered smart speakers and TVs already, features that are merely duplicated by AT&T’s Android box.
For new customers, the prospect of bundling service TV and Internet service together might bring some peace of mind — one bill to pay, although an insanely high bill that could be offset by price-shopping for cheaper Internet and streaming TV service elsewhere. But for those who already have Internet service and are signed on with a competing streaming service, it makes little sense to switch, especially considering the price hike in the second year of service.