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AT&T TV Launches in Handful of Test Markets

AT&T has finally launched its streaming version of a full traditional pay TV bundle, with the portal for the new OTT service now live.

AT&T TV is now available in parts of five states: Orange County and Riverside, California; Corpus Christi, El Paso and Odessa, Texas; West Palm Beach, Florida; Topeka and Wichita, Kansas; and St. Louis and Springfield, Missouri.

The service is delivered over-the-top with a proprietary self-installed Android TV-based set-top box and cloud DVR.

But make no mistake, this isn’t a typical cheap and cheerful “cancel anytime” vMVPD service . In fact, the service tiers being offered, however, appear much like AT&T’s linear DirecTV satellite TV service, both in terms of pricing, nomenclature and commitment.

Yes, there are early termination fees.

For example, the “Entertainment” package is $89.99 for the first 12 months of a 24-month commitment, when bundled with a 25 Mbps - 100 Mbps AT&T wireline internet plan. The price shoots up to $133 a month for the second year. The Entertainment tier is also available as a stand-alone for $59.99 a month for the first 12 months and $93 a month starting the second year.

The tiers move up the ranks—$64.99 for the first year for “Choice,” $74.99 for “Xtra,” $79.99 for “Ultimate”—with each upgrade adding 20-plus channels. There’s also a Latino-targeted bundle called Optimo Mas for $64.99 a month. Notably, all of the bundles except for Mas include ESPN.

Also notable: There’s a rather hidden-in-the-fine-print $8.49-a-month regional sports network fee tacked onto the Choice tier and higher.

Overall, however, there doesn’t seem to be a lot of other hidden landmines—a set-top lease fee, say—and the service appears slightly cheaper than traditional DirecTV satellite service.

For their part, AT&T executives say the IP-based service is far more sustainable in an era of high program costs, given AT&T TV doesn’t requires truck rolls to residents, or the launch of expensive satellites.

And not to be overlooked, the Android TV-based service provides customers access to the full flora and fauna of the Google Play Store, meaning OTT apps like Netflix and YouTube are already integrated.

For AT&T, which lost 778,000 linear pay TV users in the first quarter, change is probably good.