Enlarge /. A DirecTV satellite dish seen outside a bar in Portland, Oregon in October 2019.
Getty Images | Hapabapa
AT&T has announced another round of price increases for DirecTV satellite and U-verse TV services. Monthly pricing is expected to rise to $ 9 on January 17, 2021.
"Due to the increased program costs, we are adjusting the price of our video packages," said AT&T in a notice on its website. "Television network owners periodically increase the fees they charge DirecTV for the right to broadcast their films, shows and sporting events." Of course, AT&T determines some of these program prices itself as it owns Time Warner.
DirecTV's 160-channel "Entertainment" package, which currently has a standard price of $ 97 per month, is increasing by $ 5 per month. The 185 channel Choice package increases by $ 7 a month and is currently at $ 115 per month. Both the 250-channel Ultimate package (currently $ 142) and the 330-channel Premier package (currently $ 197) will increase by $ 9.
New customers can get these packages for $ 64.99 to $ 134.99 at discounted prices that expire after 12 months. "If you currently have a DirecTV TV promotion, keep this discount until it expires," AT&T said. "Once your promotion period ends, you will pay the new price for your package."
There are also increases of $ 1 and $ 3 for DirecTV's Basic and Preferred Choice packages for international customers, $ 6 for certain Spanish language packages, and $ 8 for "Xtra" packages. Only the Minimum Service, Family, and ChineseDirect Plus plans will not increase.
AT&T is increasing U-Verse TV prices by $ 5 to $ 9 per month depending on the package, while the price of the simplest U-Verse package stays the same. U-verse offers TV over AT & T's wired network. As with DirecTV, customers with U-verse advertising prices will only see the increase after the promotion period has expired.
New fee and some price reductions
DirecTV also adds a Federal Cost Recovery Fee of $ 0.19 per month, similar to a fee that used to be charged once a year. Despite the name, the fee is not required by the government. AT&T said the fee "covers expenses DirecTV pays to the Federal Communications Commission."
While this fee starts out small, in the past AT&T has secretly raised overall prices by adding new fees and increasing them steadily over the years. The Federal Cost Recovery Fee is in addition to a number of other fees that AT&T excludes from the listed prices in order to advertise lower prices than actually charged.
On the positive side, AT & T's announcement did not include any increases in fees for the regional sports network and broadcast television, both of which were charged a year ago. We asked AT&T if they plan to increase these fees further and will update this article when we receive a response.
Believe it or not, AT&T says it is cutting the price of some premium channels. This includes $ 3 less for Starz, Cinemax, and Showtime. Certain add-on packages that include sports channels also have price reductions of up to $ 3. But even on premium channels there are some price hikes, including a $ 2.96 increase for an add-on package that includes HBO Max, Starz, Showtime, Cinemax, and a sports channel package. The full list of price changes can be found at this link.
Epic customer losses, pending sales
The TV bills can vary greatly depending on the basic package, additional channels and special prices. AT&T charges an average of $ 130.55 per customer per month for DirecTV and its other premium TV services.
AT & T's customer base has declined dramatically due to price increases, fewer promotional offers, and competition from cheaper streaming services. AT&T currently has 17.1 million premium TV subscribers, compared to over 25 million in early 2017. This category includes DirecTV satellite, U-Vers and the newer AT&T TV online service, the cable TV with hidden fees , Contracts and large secondary news. Price increases per year.
AT&T has been looking for a buyer for DirecTV, and the deals reportedly value the satellite subsidiary at less than $ 16 billion – about a third of the $ 49 billion AT&T paid for the company in 2015. A possible deal would have resulted in AT&T holding the majority while another company takes over the pay-TV operations for DirecTV and U-verse. As CNBC reported this month, AT&T is in talks with private equity firms "to sell a significant minority stake … in its pay-TV business in a complicated transaction that will remove legacy assets from the carrier's balance sheet would".
"Under the terms of the proposed deal, AT&T would retain the economic majority interest in the company and retain ownership of the U-Verse infrastructure, including equipment and fiber," CNBC wrote, citing unnamed sources. "The buyer would control the pay-TV distribution and consolidate the deal on their books."