AT&T offers new details on three-tier subscription VOD service for 2019

AT&T is banking on hit content like HBO’s Game of Thrones to propel its future growth. 

HBO

AT&T is going all-in on streaming video services. 

The telecom giant, in the midst of a transformation into an entertainment powerhouse via its acquisition of Time Warner, offered a business update that included new details on its plans for a subscription video-on-demand service. 

The service, planned for the fourth quarter, will have three tiers: a low-end option focused on movies, a midtier service bundling blockbuster movies and original programming and a top-end service that includes the first two plus more WarnerMedia and licensed content. AT&T plans to launch the service in the fourth quarter of next year. 

The details are further evidence of AT&T’s push to lean into entertainment services as its future growth-driver at a time when its wireless business faces tremendous competition from the likes of Verizon Wireless and T-Mobile. While the other carriers have retrenched into their core wireless services, AT&T has aggressively expanded into the media world.

The company likewise teased a second subscription VOD service that would be supported by advertisement, saying only that it would launch in the future. These services come on top of its HBO Go premium service, as well as live streaming TV services like DirecTV Now and AT&T Watch. Though the company hasn’t said more about the new services, it’s likely that programming from HBO will appear in them, given the intense interest in properties like Game of Thrones and Westworld. 

On the wireless front, AT&T said it expects to continue growing revenue and profits in wireless through its investment in 5G services, as well as its FirstNet network, which is dedicated to emergency services. While its entertainment ambitions are high, the mobility business continues to bring in the largest share of revenue, at 40 percent. 

Overall, AT&T expects adjusted earnings growth in the low-single digits.

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