AT&T To Launch Three-tiered Streaming Service

AT&T Inc. (NYSE: T) has announced that it will be rolling out three streaming video services by late 2019. The company unveiled plans for the unnamed service during a presentation to investors in New York. This will make AT&T the latest company to create a standalone streaming app to compete against Amazon and Netflix.

The company is using the new offerings as a way to boost revenue from its $85 billion Time Warner deal. Chief Executive Officer Randall Stephenson said in September that he planned to use Time Warner’s HBO as the anchor for a new online video service and complement it with Warner Bros. shows and films. WarnerMedia currently represents about 17 percent of AT&T’s revenue.

According to the announcement, the highest-priced of the three options will have a library that includes content licensed from other companies. The next tier will include original programming and blockbuster films, while the lowest tier will be a movies-only plan. AT&T CEO Randall Stephenson did not say what each tier would cost when he made the announcement.

Speculation is swirling in the industry about who WarnerMedia might choose to oversee programming for the venture. WarnerMedia just named Brian Bentley, formerly head of marketing for DirecTV and AT&T Entertainment Group, as general manager and exec VP of direct-to-consumer development to oversee the streaming service.

AT&T will have plenty of competition in the space. In addition to Netflix and Amazon, Walt Disney Co. recently announced that it would be introducing an online streaming service with Star Wars and Marvel shows. Because it is creating its own streaming product, Disney will be ending its distribution agreements with Netflix for new movie releases.

It still remains to be seen what all of this will mean for the Hulu streaming service. Hulu is currently a joint venture of Disney, 21st Century Fox, Comcast and AT&T, after AT&T inherited its 10 percent stake in Hulu from Time Warner. Disney will become Hulu’s majority shareholder once its acquisition of Fox is finalized. It is likely that Disney will buy AT&T’s interest in the streaming service.

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