Q. I am so mad right now. I read your post about DIRECTV cutting prices for new customers, but what about us, the people who have had DIRECTV for years. When will we ever get a break? I am so fed up with these people!! — Stacey, Laurel, Maryland.
Stacey, you’re right. AT&T, which owns DIRECTV and U-verse, just cut the first-year promotional price for both services by $10 a month.
New subscribers to DIRECTV can now pay $49.99 a month for the first year of its Select plan (155 channels), compared to $59.99 previously; $59.99 a month for the first year of its Choice plan (185 channels), compared to $69.99 a month previously; and $74.99 a month for the first year of its Ultimate package (250 channels), compared to $84.99 a month previously.
The offer, which is good until March 28, has triggered harsh criticism from many existing DIRECTV subscribers, some of whom have taken to social media sites to express their anger.
“AT&T should worry about their current customers!,” “Kim” wrote on our site earlier this week. “I just cancelled last week when the price increased to $145 on my last bill. I’m now happily hooked up to a TV antenna and waiting for my Amazon Fire Stick.”
Kim has a point. AT&T has lost six million DIRECTV and U-verse subscribers combined since taking over the satellite TV service in 2015. You would think that it would do something for existing customers as well to keep future defections at a minimum.
However, many, if not most, DIRECTV subscribers are locked up in two-year contracts, which they agreed to when they signed up for the service. (DIRECTV offers inducements such as free NFL Sunday Ticket if you agree to the two-year pact.) And the penalty for leaving the agreement early is $20 a month for every month left in the two-year period. That can turn into a costly exit if you leave with even just 12 months left. (12 months x $20 = $240.)
Consequently, despite the past sub losses, AT&T likely feels less pressure to do a favor for its existing audience because so many of them are stuck in the two-year deals. The contracts make it less likely that they will leave.
Now the sheer number of defections since 2015 should make AT&T think differently, in my opinion. There are a lot of subscribers who are counting the days to the end of that two-year agreement, and will likely leave when it’s over.
But AT&T has demonstrated little interest in providing extra customer service and features for the existing DIRECTV audience since it took over the satcaster almost five years ago. (That’s not me talking. That’s the consensus of nearly 100 comments posted by DIRECTV subscribers here in the last two weeks.)
So with so many subscribers unable to leave without financial penalties, AT&T probably feels it’s more important to invest in a marketing effort that might attract new subscribers.
Yes, new subscribers who will agree to two-year contracts.
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— Phillip Swann