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AT&T Scales to Top of MVPD Mountain

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AT&T’s $48.5 billion merger with DirecTV has placed the telco at the top of the distribution food chain among multichannel video-programming distributors. Armed with greater leverage to negotiate distribution deals with content providers, AT&T executive vice president and chief content officer Dan York is in a good position with regard to developing the company’s future content strategy. in an email exchange with Multichannel News programming editor R. Thomas Umstead, York — who was chief content officer at DirecTV before the merger and, prior to that, was head of content and advertising sales at AT&T — answered questions about his content plans for the merged entity and his thoughts on future content trends within the industry.

MCN:You have run both the AT&T U-verse and DirecTV content divisions and now oversee them both. How will the content setup be structured under the merged entity?

Dan York: The DirecTV and U-verse programming, content acquisition and development functions have been brought together as one. The team handles all content-related matters for all U.S. AT&T platforms, including pay TV, mobile and online. It also includes our regional sports networks, original programming, and content operations and is now consolidated under the new AT&T Entertainment and Internet Services (AEIS) Content organization.

MCN:What advantages does the merger give you with regards to negotiating deals with programmers? Does it change your content acquisition priorities at all?

DY: Our unmatched position as the world’s largest pay TV provider, with over 19 million Latin America and 26 million U.S. pay TV customers — plus over 100 million mobile and Internet customers — will enable us to create more value and a better experience for our customers. Our focus remains the same: Provide our customers with the best content and experience across all platforms and devices, at the best cost structure in the market.

MCN:With an increased industry focus on mobility and bundling in broadband and wireless, how does that factor into your content priorities?

DY: In our conversations with programmers, we always keep top of mind what matters to our customers: the ability to receive their content wherever, whenever and however they want, on any screen they choose, at a price they can afford.

MCN:Is over-the-top distribution something that becomes a more interesting option now?

DY: We view it as simply delivering the best content offering and experience regardless of platform, such as our satellite assets or via IP. DirecTV has been delivering content over IP for years now with our robust TV everywhere offering, as well as our “NFL Sunday Ticket. TV” streaming service. Last December, we launched a new IP-delivered service dedicated to Spanish-language viewers called Yaveo.

Now, as part of the AT&T family, we’re in a unique position to develop and expand these and new services to more customers. There are also some exciting opportunities on the horizon through our joint venture with The Chernin Group, as we look to officer unique mobile-centric content to complement our more traditional offerings.

MCN:Will you look to add networks currently on U-verse’s lineup that DirecTV does not carry, and vice versa?

DY: We are focused on providing U-verse and DirecTV customers with a great entertainment experience and programming they can effortlessly watch on any device — all at the right price. We will carefully evaluate what is best for all of our customers and our business.

MCN:Will the new entity look to develop exclusive, original programming for its subscribers?

DY: Original programming has been a focus for DirecTV for years and will be an area to potentially further differentiate across all platforms. Our team will be very active in developing new and exclusive content that we’ll be able to deliver to any device. We’re excited about what the future holds in this area of our business and for our customers.

MCN:Whom do you see as your competitors?

DY: While one could consider almost anyone who delivers video entertainment to consumers a competitor, frankly, when you look at the unique combination of our content, pervasive mobile, broadband and video scale and ability to deliver a premium, effortless entertainment experience almost anywhere, we don’t think anyone compares. No one will be able to deliver the quality and breadth of content as efficiently on such an extensive scale to more devices at more value than AT&T Entertainment and Internet Services.

MCN:How do you see the content business evolving over the next five years?

DY: This is not exactly a news flash, but the traditional linear TV model will continue to change as content is increasingly viewed on multiple platforms. If recent trends are any indication, the future is likely to be about increased consumer choice, personalization and portability. That’s not to say families won’t continue to congregate around their 60-inch flat screen TV to watch their favorite show, movie or sporting event, but consumers will increasingly want the opportunity to watch what they want to watch on their own terms. Programmers will also need to adjust to that reality with more flexibility and affordability in their content offerings. Ultimately our customers will tell us how this will all play out, but as part of the AT&T family we are well-positioned to explore new business models that anticipate and embrace that future.

MCN:Will you consider developing skinny bundles in an eff ort to provide customers with more choice?

DY: We are always looking for ways to deliver the right value for our customers, but any conversation about skinny bundles has to begin with programmers who tie numerous marginal channels to their more popular networks. We will continue to try to find the right model and price/value equation that works for our business and our customers, but tough choices must be made or consumers will increasingly make them for us and our content suppliers. We believe that inflexible programmers with obese, declining or overpriced content offerings face being left behind.

MCN:Will NFL Sunday Ticket ever be offered to U-verse TV subscribers?

DY: NFL Sunday Ticket is exclusively available to DirecTV customers via satellite as well as to college, urban and MDU segments via [IP], and it will be for many years. AT&T U-verse customers who want to receive the NFL package can subscribe to DirecTV.