Q. DIRECTV Now just raised its prices last summer. Are they going to raise them again?! I heard that they will. Is that true? — Marlena, Lexington Park, Maryland.
Marlena, you are right. DIRECTV Now, the live streaming service owned by AT&T, last July raised its base package price from $35 a month to $40 a month. The increase was the first in the service’s existence since its launch in November 2016.
However, I’m afraid I have to tell you that more price increases are coming — and probably sooner than later.
Randall Stephenson, AT&T’s chief executive, last week told a financial conference that he wants to set the base price for DIRECTV Now between $50 a month and $60 a month. He did not say when the increase will happen, but Stephenson sounded eager to implement it as soon as possible to make DIRECTV Now profitable.
(At $35 or $40 a month, most analysts believe AT&T has been losing money on DIRECTV Now, which has roughly two million subscribers.)
“We’re talking $50 to $60 price offering (for DIRECTV Now,”) Stephenson told UBS conference, according to Seeking Alpha. “We’ve learned this product. We think we know this market really, really well. We had a lot of success. We built a 2 million sub base. But we’re asking that…DIRECTV NOW…do too much work. So, we’re thinning out the content, getting the price point right and getting it to where it’s profitable.”
The ‘thinning out the content’ comment also suggests DIRECTV Now will soon carry fewer channels.
With higher prices, and less programming, DIRECTV Now could be headed for a sharp reduction in subscriber growth, particularly considering that AT&T plans to introduce several other streaming services next year including one that would be an alternative to DIRECTV’s satellite offering.
Marlena, hope that helps. Happy viewing!
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