Earlier in 2016, DirecTV announced that it will launch a new streaming service, DirecTV Now, by the end of the year. Various reports in trade publications have indicated that AT&T, DirecTV’s new owner, would like to launch a package of 100+ channels for a very aggressive price point, somewhere around $55 a month. It’s unclear yet which 100 channels a consumer would get for their money or whether their flagship product, NFL Sunday Ticket, will be included in that $55 fee.
DirecTV Now becomes just the latest streaming multi-channel product offering to launch in the last two years. Satellite rival Dish Network beat them to the punch with Sling TV in 2015, and Sony followed several months later with it’s Playstation Vue package. Having subscribed to both of them at one time or another, I can attest to the fact that both of those services offer compelling reasons for customers to “cut the cord” from a traditional cable TV lineup.
But there are rumors that DirecTV may go a step further than Dish Network. A recent story in the Dallas Business Journal (http://www.bizjournals.com/dallas/blog/techflash/2016/09/report-at-t-has-set-a-timeline-to-phase-out.html) says that AT&T would like to phase out satellites and dishes as soon as 2020, forcing customers to get DirecTV Now. On its surface, it’s an idea that makes a lot of sense. Operating satellites and hordes of technicians to install and troubleshoot the service is an expensive proposition. If indeed AT&T fulfills this vision, it could have a big impact on broadband Internet providers as bandwidth needs of customers would further increase. But it could also be a boon to those providers whose only profit margin exists on internet service and not video. In fact, it could be a win-win for AT&T and local ISP’s.
Having dipped their toe in the water with SlingTV, a “skinny bundle”, will Dish Network follow AT&T’s lead and push to move their service out of geosynchronous orbit and onto broadband networks?
The primary challenge to this transition for DirecTV (or Dish Network for that matter) will be the fact that many of its customers live in rural areas where reliable broadband with enough bandwidth for multiple HD or 4K video streams is hard to find. Will those folks be allowed to keep their dishes until such time in the future as real broadband arrives at their home? If so, any savings that AT&T is planning on will evaporate. They will need to maintain their fleet of satellites for years beyond 2020.
So, will AT&T ditch the dish for its DirecTV services? I think the answer is yes in the long term. But America’s broadband infrastructure has a long way to go before it can make that move without losing a significant number of rural customers.
DirecTV Now becomes just the latest streaming multi-channel product offering to launch in the last two years. Satellite rival Dish Network beat them to the punch with Sling TV in 2015, and Sony followed several months later with it’s Playstation Vue package. Having subscribed to both of them at one time or another, I can attest to the fact that both of those services offer compelling reasons for customers to “cut the cord” from a traditional cable TV lineup.
But there are rumors that DirecTV may go a step further than Dish Network. A recent story in the Dallas Business Journal (http://www.bizjournals.com/dallas/blog/techflash/2016/09/report-at-t-has-set-a-timeline-to-phase-out.html) says that AT&T would like to phase out satellites and dishes as soon as 2020, forcing customers to get DirecTV Now. On its surface, it’s an idea that makes a lot of sense. Operating satellites and hordes of technicians to install and troubleshoot the service is an expensive proposition. If indeed AT&T fulfills this vision, it could have a big impact on broadband Internet providers as bandwidth needs of customers would further increase. But it could also be a boon to those providers whose only profit margin exists on internet service and not video. In fact, it could be a win-win for AT&T and local ISP’s.
Having dipped their toe in the water with SlingTV, a “skinny bundle”, will Dish Network follow AT&T’s lead and push to move their service out of geosynchronous orbit and onto broadband networks?
The primary challenge to this transition for DirecTV (or Dish Network for that matter) will be the fact that many of its customers live in rural areas where reliable broadband with enough bandwidth for multiple HD or 4K video streams is hard to find. Will those folks be allowed to keep their dishes until such time in the future as real broadband arrives at their home? If so, any savings that AT&T is planning on will evaporate. They will need to maintain their fleet of satellites for years beyond 2020.
So, will AT&T ditch the dish for its DirecTV services? I think the answer is yes in the long term. But America’s broadband infrastructure has a long way to go before it can make that move without losing a significant number of rural customers.
RSS Feed