Market Insight

AT&T re-positions Mobile TV service to support 4G strategy

February 08, 2013


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US mobile operator AT&T has rebranded its U-Verse Live TV service as simply Mobile TV alongside a number of other changes to its service.

The revamped service allows subscribers to take advantage of live and on-demand mobile video content on the go over a Wi-Fi or mobile network connection for $9.99 a month. AT&T Mobile TV is available on Windows Phone, iOS, BlackBerry and Android devices. AT&T promises its 4G customers enhanced picture quality when using the service over a 4G network. To subscribe to the service, users must have 3G or 4G data plan, and video data consumed over the mobile network will count towards the users' monthly data limit.


Features include:

  • A seven day free trial after which the user is charged $9.99 per month direct to their bill.
  • Access to live, on-demand and downloadable videos from ESPN Mobile, Disney Channel, Comedy Central, FOX News, ABC Mobile, MTV and several more.
  • Enhanced picture quality over 4G LTE.
  • Direct billing to customers' AT&T accounts.
  • Premium add-on packages which include the Urban Zone Pack featuring BET, Playground TV Pack with kid's television shows and Paquete en Español móvil with programming available from popular Hispanic networks for an additional $4.99.

The rebranded and revamped service comes at a critical time for operator-led mobile video services. In recent years operators, particularly in Western markets, have generally scaled back their content plans as over-the-top (OTT) services accessed on smartphones and distributed by application stores have taken precedence. Now, with the rise of new fast 4G mobile networks, operators have a chance to reassert their position in mobile video with their own services or by enabling third parties.

From a consumer perspective, video is one of the key features that demonstrates the advanced capabilities of faster and lower latency 4G networks.

Many other activities such as social networking are often satisfied by current 3G coverage or are less marketable (e.g. file sharing). Providing or enabling high quality video, and demonstrating this to consumers, must be a key part of an operators' 4G strategy.  UK mobile operator EE marked the launch of the UK's first 4G network with the introduction of its own-branded movie store, promising users one free film per month and zero data from their allowance for EE Film content to encourage users to pay for its premium 4G plans.

As AT&T does not charge a premium for 4G access since it comes as standard as part of all its data plans (where applicable), its video service serves two primary functions: to push users on to higher capacity and higher value data plans; and drive incremental revenues from the $9.99 per month subscription.

While video services will be vital to operators' 4G strategy, operators are still experimenting to find the best business model, pricing and packaging. AT&T's additional $9.99 charge will prove too steep for mass-market success, especially given the plethora of free and low-cost OTT video services. As data consumed via the mobile TV service counts towards a users' monthly allowance, AT&T is effectively charging twice for the mobile TV experience because a high tier data plan will be necessary to deliver a compelling over-the-air viewing experience -- a factor that may limit uptake and hinder AT&T's overall strategy. Instead, AT&T should charge for either the mobile TV service or the data used, but not both.

 

 

Geography
North America USA World
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