DIRECTV NOW Expects to Thin Bundle, Raise Prices to Become Profitable

At the UBS Global Media & Communications Conference today, AT&T CEO Randall Stephenson hinted that customers might be seeing a smaller, more expensive bundle from DIRECTV NOW in 2019.

Stephenson shared that he expects DIRECTV NOW to “thin the content out, get content that’s really relevant to a particular customer segment.” While the service launched in November 2016 at $35 a month, he thinks the target market is a “lower priced offering” targeting a “$50-60 price.”

Much of the change has come from what they’ve learned building the product and in an effort to get the service profitable. “We’ve learned this product, we think we know this market very well. We had a lot of success, built a 2 million sub base,” said Stephenson. “But we were asking that DIRECTV NOW product to do too much work. So we’re thinning out the content, getting the price point right, making it profitable.”

As 2019 rolls around, it wouldn’t be a surprise to see other vMVPDs also considering price increases and different kinds of bundles. Last month, Hulu shared that could shift some of their live channels to on demand to cut costs.