AT&T-owned streaming TV service DirecTV Now is launching two new “slimmer” channel packages, Plus and Max, both of which include HBO.
AT&T didn’t offer up specifics on what channels will be included in each package. But the company said that in addition to HBO, Plus (priced at $50/month) and Max (priced at $70/month) will come with “dozens of live TV channels, including local ones, and an extensive on-demand library of great movies and TV shows.” The Max package will include more live sports channels, video-on-demand choices and HBO and Cinemax.
DirecTV Now currently offers five different channel packages priced between $40/month and $65/month. The company said that existing DirecTV Now subscribers can remain on their current packages.
The news from AT&T confirms in part a report last week from Cord Cutter News. The report said that DirecTV Now will raise prices by $10 per month for subscribers who remain on their old packages but AT&T did not mention that in its new release today.
AT&T did not immediately respond to a request for confirmation regarding price increases for its legacy DirecTV Now subscribers.
UBS analyst John Hodulik said in a research report that the new DirecTV Now packages will cut out entertainment channels from programmers including Discovery Inc., AMC Networks, A&E and Viacom. Channels from those programmers make up the primary lineup for AT&T’s $15/month Watch TV streaming service.
AT&T is currently coming off the fourth quarter where DirecTV Now dropped 267,000 subscribers, and Hodulik predicts the new pricing and plans could make things worse moving forward.
“The price increases at DirecTV Now and discontinuation of existing plans for new subs should increase churn/lower gross adds, worsening sub trends,” wrote Hodulik. “We are increasing Now losses to 308K in first-quarter 2019 (prior -274K) and to 822K for FY19 (prior -547K).”
But Hodulik added that profitability should improve given lower programming cost.