AT&T Sets Launch Event for Streaming DirecTV Now

$35-a-month service set to carry 100 channels

AT&T is inviting media to a launch event for DirecTV Now on Nov. 28 in New York.

At a time when cord-cutting is a big concern to distributors and programmers, the company has been busy lining up about 100 networks to be on its new streaming service, which will be available for $35 a month, a price point that was lower than most observers have been expecting.

In the invitations, AT&T says “Please join us for a special, invitation-only event to celebrate the launch of DirecTV Now—a new way to stream live TV.” The invitation carries a hashtag #MoreTVFreedom.

Several companies have either launched or announced plans to get into the virtual MVPD business. Dish Network’s Sling and Sony’s PlayStation Vue are already up and running. Hulu is expected to launch a live service next year and YouTube is working on one as well. But DirecTV looks like it will be particularly aggressive with DirecTV Now.

DirecTV Now is set to carry networks from Disney/ESPN, HBO, NBCU, Turner, Discovery, Scripps Networks Interactive, AMC Networks, Starz, Viacom and Univision.

Analyst Craig Moffett of MoffettNathanson Research noted that at the $35 price point, AT&T would be netting $1 above the cost of programming. Adding in other expenses, including customer service, DirecTV Now’s margin would be negative, he said.

The new service will be a single-stream, which means subscribers can only watch one program at a time on one stream, which would make it different from DirecTV’s pricier satellite service and discourage cannibalization.

AT&T seems to be aiming to capture market share in the streaming market, but at that price, it could be risky.

“Like running with scissors, it probably won’t be life threatening—the number of subscribers they will cannibalize won’t be large enough to inflict a mortal wound to their own business, and the single stream limitation and inherent drawbacks of an OTT service will similarly limit the damage to the Pay TV ecosystem overall. Still, we believe DirecTV is playing a dangerous game,” Moffett said.