When AT&T launched DIRECTV Now back in November 2016, it had absolutely no idea of how popular the service was going to be. Within the first month, nearly 200,000 subscribers signed up for the service, thanks in part to some exceptionally strong promotional pricing for the service (just $35 per month). But was this a case of expanding too fast, too soon?
As you might imagine, nearly 200,000 brand new subscribers signing up at once put a lot of strain on the service – and that led to a much-publicized outcry about “freezing” and “buffering” problems with the streaming TV service. In layman’s terms, DIRECTV didn’t work as advertised, and it was actually kind of frustrating for users. Since the content was being streamed over the Internet, it meant that the service was bound to be a little bit buggy if there were bandwidth issues. But in the six months since launch, DIRECTV has made a number of notable improvements.
#1: Fixing all the freezing and buffering issues
OK, first things first. AT&T became very concerned about the public outcry over poor or spotty service and decided to do something about it. It’s bad enough when a service doesn’t work as planned – but it’s made doubly worse when that bad service literally becomes a topic of national debate. In some cases, customers were taking their issues to media outlets, or threatening all kinds of actions when AT&T had trouble with refunds.
So AT&T began to phase out all of its promotions and advertising until it had a handle on all the issues. That’s why you’ve probably seen the Bloomberg stories about “flat growth” at DIRECTV Now since March 2017 – well, it was really a case of AT&T not wanting to put even more strain on the system until it had all the technical issues ironed out. And AT&T was very direct about all this, with its executives saying that you wouldn’t be seeing a rollout of a national advertising campaign until all the problems had been fixed.
And guess what happened in June 2017? That’s right, the first-ever DIRECTV Now ad campaign featuring Mark Wahlberg went live. If you haven’t seen the ad on TV by now, you can watch the “All Our Rooms” ad with Mark Wahlberg on YouTube. So you can take the appearance of this new ad in June as a positive sign – it means that AT&T has fixed all the technical issues with DIRECTV Now and is ready to move on.
#2: Coming up with an unbelievable $10 per month pricing offer
Running a national advertising campaign is one way to convince people to sign up for your service. But do you know what’s even more effective? Yes, that’s right, a completely amazing pricing offer! On June 2, AT&T made DIRECTV Now a $10 add-on to the $60 Unlimited Choice plan for wireless. In other words, if you were paying $60 a month for wireless, you could get 60 channels from the DIRECTV Now “Live a Little” service for just $10 more.
At those prices, who wouldn’t want to sign up for DIRECTV Now? One major tech blog said that AT&T was “basically giving away” TV programming to its wireless customers. And the “Live a Little” bundle is actually pretty extensive, covering 60 channels in all. And those channels include the major networks (ABC, NBC, Fox) in addition to some of the very best TV networks, like CNN and CNBC. In other words, this is not a classic “skinny bundle” that the other live streaming TV competitors try to get away with – it’s actually very robust and includes all the very best TV networks.
What’s clever about the $10 pricing is that AT&T is actually still charging customers $35 a month for the service, but then is adding in a $25 “video credit.” So, $35 – $25 = $10. This is because the $10 is just promotional pricing – it’s not going to be the permanent price of the live, streaming service.
#3: Adding in support for Roku
DIRECTV Now is like all the other live streaming TV services in that you need some kind of set-top box to get content for your TV. Not a traditional cable TV box, of course, but a set-top box or similar device from the likes of Amazon (Amazon Fire TV), Google (Chromecast) or Apple (Apple TV). The one service that wasn’t included at launch was Roku.
You can see how that was a major oversight, given the popularity of Roku with so many cord-cutters. So, on May 30, AT&T made DIRECTV available for Roku users. Moreover, it came with a 1-month free trial on Roku. That gave Roku users a very strong incentive to try out the new and improved DIRECTV Now service.
Thus, prior to May 30, a Roku user would have seen icons for the likes of Netflix and Hulu on their screen – but none for DIRECTV Now. That has all changed now – you’ll now see the familiar DIRECTV Now logo anytime you use your Roku device.
#4: Finalizing plans for a cloud DVR
Every live streaming TV service seems to have a No. 1 “most requested item” on the wish list of customers. (In the case of Sling TV, it was a grid format TV guide to see what’s on at any time). Well, in the case of DIRECTV Now, that No. 1 “most requested item” was a cloud DVR.
Think about it – if you are a traditional cable or satellite TV customer, you probably have a box-like DVR next to your TV that’s capable of recording and playing back digital content. Well, there’s no set-top box for live, streaming TV. And you don’t get a DVR with your Apple TV! So that meant fans and customers who signed up for DIRECTV Now were facing a major issue: How do I record digital content without a physical DVR?
The answer to that question, of course, is a cloud DVR. When you use Hulu Live or Playstation Vue, for example, you get a cloud DVR. So, just to keep up with other live streaming TV rivals, DIRECTV Now had to come up with a cloud DVR. It just makes sense, right? So be on the lookout for a DIRECTV Now cloud DVR soon.
#5: Coming up with new subscription plans for customers
When DIRECTV Now launched to so much fanfare back in November 2016, one of the key selling points was the ability to get 100 channels for just $35 per month. If you compared that to what competitors like Sling TV and Playstation Vue were offering, it just blew away anyone else. Really, 100 channels for just $35?
So it was almost inevitable that DIRECTV Now started to come up with new subscription plans for customers. The idea is to provide a lot of value, but not at a price that’s just plain ridiculous. So DIRECTV Now executives had a choice – either jack up the price of the basic package (a decision that was almost certain to cause another outcry from critics), or reduce the number of channels available in the basic package.
DIRECTV Now made the right choice. You now get 60 channels for $35 a month as part of the basic “Live a Little” package. And, to keep getting 100 channels, you now need to pay $60 a month. Both prices are extremely fair, and emblematic of how AT&T is really trying to come up with innovative types of subscription plans for customers.
What’s next for DIRECTV Now?
So, let’s recap all the latest improvements from DIRECTV Now. First and foremost, DIRECTV Now has largely addressed all the freezing and buffering issues that plagued the service when it was first offered. Secondly, DIRECTV Now came up with an unbelievable pricing promotion – just $10 a month! – for customers who sign up for AT&T wireless service.
Thirdly, DIRECTV Now expanded its platform support to include Roku, one of the very most important platforms for cord-cutters. Fourthly, the company came up with a plan to offer cloud DVR service. And, fifthly, the company continues to develop new plans and bundles to appeal to customers.
Based on all that, it’s quite possible that DIRECTV Now is going to start seeing some robust growth in its subscribers. According to the latest data from Bloomberg, DIRECTV Now peaked at 328,000 subscribers in January 2017. It then lost 3,000 subscribers in February. And, in March, subscriber growth was flat. That made sense, of course – March was the last month that AT&T was aggressively offering promotions (like a free Apple TV with a subscription).
So we’re about to see what’s going to happen when all of these latest improvements really start to kick in. It’s quite likely that, based on the acclaim for the new ads starting to run on TV, we’re going to see growth picking up in June and continuing throughout the summer. Based on that, it’s possible to say that AT&T learned its lesson and is now on a really exciting trajectory for future growth with its DIRECTV Now service.