AT&T Can't Get Out Of Its Own Way As It Tries To 'Disrupt' Traditional TV

from the meet-the-new-boss... dept

So we’ve noted a few times how giant telecom providers, as companies that have spent the better part of the last century as government-pampered monopolies, are adorable when they try (then inevitably fail) to innovate or compete. Verizon’s attempt to pivot from curmudgeonly old phone company to sexy new media darling, for example, has been a cavalcade of clumsy errors, missteps, and wasted money.

Much like that time Verizon tried to launch a “tech news” website that banned reporters from talking about net neutrality or government surveillance. Or the time it launched a Millennial-focused video streaming service nobody wanted to watch. Or the time it bought Tumblr (via Yahoo), banned porn, watched everybody leave, then had to sell the whole thing for a song.

AT&T hasn’t been much better as it has tried to “disrupt” the TV space. You’ll recall the company spent more than $150 billion to acquire Time Warner and DirecTV in a bid to dominate streaming and the online video advertising space. But the deals saddled AT&T with so much debt, it forced the company to raise rates despite rising competition, driving many of these customers to the exits. AT&T also launched a rotating array of video brands (more than 7!) that were so confusing, it even dumbfounded the company’s own customers.

Hoping to right the ship, AT&T this week launched another variant of its streaming video platform. Despite the fact that US consumers are clearly tired of proprietary cable boxes, sneaky fees, and quickly-ballooning promotional rates, AT&T apparently thought it would be a good idea to “compete” in the streaming space by launching a platform that incorporates all three:

“After 12 months paying the promotional rate, you pay the “prevailing rate,” which is double or close to double the first-year base rates before taxes and fees. Under current prices, the $49.99 promotional rate for the entry-level “Entertainment” package would rise to $93 per month in the second year. The promotional $54.99 rate for the Choice plan would double to $110; the $64.99 promotional rate for the Xtra package would rise to $124; and the $69.99 promotional rate for the Ultimate package would rise to $135.

Those prices do not include an $8.49 per-month fee for regional sports networks, which applies to the Choice, Xtra, and Ultimate packages.

It’s just astonishing to watch a company that has been bleeding subscribers by the boatload survey the market, carefully consider its next steps, then double down on all of the annoying shit that brought them to this point:

“Signing up for AT&T TV requires a two-year contract, with an early termination fee of $15 for each month left on the agreement at the time of cancellation. A $20 activation fee is waived if you order online…Each customer gets one Android-powered AT&T TV device and a Google Assistant-powered voice remote included in the plan, but you have to pay $120 for each additional TV box.

Telecom has long proven to be a pretty insular industry, with executives that tend to surround themselves with yes men who applaud every misstep. It’s reflected in the telecom policy analyst and think tank space, and the revolving door regulators that pass from telecom to governance. They literally can’t see how clumsy monopoly dominance has frustrated consumers, broken the market, and resulted in high prices, terrible service, and a cavalcade of bad ideas. As such, they literally can’t see the best way to appeal to these users either, because to them…there’s no problem that needs fixing.

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Companies: at&t

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Comments on “AT&T Can't Get Out Of Its Own Way As It Tries To 'Disrupt' Traditional TV”

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TKnarr (profile) says:

As such, they literally can’t see the best way to appeal to these users either, because to them…there’s no problem that needs fixing.

No, to them there is a problem that needs fixing. It’s just that they think the problem is that customers aren’t buying their product. They refuse to accept that that’s not the problem, it’s just a symptom of the problem.

When faced with a patient who tells the doctor that they don’t want to stop hitting their head with a hammer, they just want the doctor to make it stop hurting when they do, the doctor has two options:

  1. Prescribe high-powered painkillers.
  2. Prescribe a 5lb hammer with instructions to apply to the head repeatedly with as much force as possible until the pain subsides.

The second has the advantage of ending the patient’s complaint quicker.

Anonymous Coward says:

Re: Re:

Actually, I think the excecutives DO see a problem, and that the problem is that they’re not earning enough revenue. So they increase the prices to try to increase the revenue.

After which they realise that the revenue has only increased slightly. So they conclude that the price increase was too small.

So they increase the price again.

Rinse and repeat.

Melvin Chudwaters says:


I’m not sure I understand.

Is this an actual contract? Usually, with real contracts (and not fake one-sided contracts where they don’t bother to get you to sign papers "in writing") the whole point is that they can’t raise the rates on you. For instance, even with Comcast (yes, that shitty company) if you get a business account they’ll make you sign an actual contract that they’ll take you to court for if you breach… but then the monthly price is locked in.

AT&T is claiming that there is this contract that no one signed for two years, but that in the middle of that after 1 year, they’ll raise the rates on?


Anonymous Coward says:

Re: Huh?

Yes, it’s an actual contract. And you’re mistaken.
In a real contract, the terms of the contact are not to change for the duration of the contract. The month price isn’t a "term". The contract states that for the first year, a specific price applies, and after that first year, a different price applies. That’s totally legal, and at the same time, sneaky for those who don’t pay attention to the contract.

Anonymous Coward says:

Re: Re: Huh?

In real contracts.

These are rarely real contracts. No documents are signed. You can sign up for this shit over the phone… and they make no effort to collect signatures. They have no intention of taking the usual remedies for breach. They just send to collection agencies.

There’s an actual distinction here, and I’ve argued with people like yourself before that pretend there is no such distinction. It’s exhausting.

Anonymous Coward says:

Re: Re: Huh?

In a real contract, the terms of the contact are not to change for the duration of the contract. The month price isn’t a "term".

In almost any contract that’s fairly negotiated between all parties, it will be. There are exceptions such as stock options/shorts, which brokers try to keep away from unsophisticated customers (with additional forms and a "know your client" quiz).

Terms like this should simply be unenforcable in contracts of adhesion. Maybe with some exceptions for things like sales-tax increases not within the contract-author’s control, or for CPI-tied increases. But "you’re required to pay us whatever amount we say you will" is unconscionable.

Bruce C. says:

Re: Huh?

Huh? Comcast business has unilaterally:
1) cancelled their email hosting and domain name registration and forced migration to office 365 with additional "cloud service" fees.
2)require monthly payment for a static IP address to use your own cable modem/router, or alternatively pay increasing fees to rent their equipment.
3) unilaterally increased monthly charges after the initial contract period.

Maybe your state has better consumer protections than mine. The only benefit I get from Comcast business is a better customer service queue, and maybe slightly fewer hidden fees.
I don’t get more reliability. When the hurricane took both phone and cable down, AT&T residential landline was restored a week before Comcast business class.

Anonymous Coward says:

Typical for most corporations, they tend to over value their product or service. I kissed AT&T goodbye some time ago when rates started going up. I got nothing extra for the price increase on a subpar product from a corporation who makes the word service trying at best; failing is a norm.

I’ve a new ISP since a start up came to my area. I’m thoroughly happy with them, the prices are near the equivalent to my old package, the speeds 20 time faster, no caps, and no contract.

aerinai (profile) says:

Story time!

So, back in the day; a technician had to come to your house, install a cable from an access point, or put a dish on your roof. That cost money. People didn’t like to spend lots of money up front just to start watching TV that they then had to pay more money for. So companies made these contracts that said, stick with us for two years and we will install for free. This let the companies guarantee revenue and spread that installation fee over a minimum of two years.

Then came the age of streaming. It didn’t require some rando coming to your house. It didn’t require a dish or a dedicated cable. It just requires the internet, which people interested in streaming already had. All they had to do is go onto the internet, click a button, and they had TV. No additional fees to recoup, no additional installs required. These contracts were no longer necessary.

Then AT&T released streaming. And they had contracts for…. reasons?

K`Tetch (profile) says:

my wife did tech support for DirecTV. I’m not saying their training was comprehensive, but she had orbit charts for all their satellites as part of the initial 3 week training.

AT&T bought them and they laid them ALL off, straight away, outsourced to the phillipines.
You can bet they never even told those people how many sats they were using, let alone orbital info.

ECA (profile) says:

I still stand by my opinion.

That these companies are buying out others at exorbitant prices, only to Dump them or sell themselves Out to other corps, to show a loss, go bankrupt, not pay much more on the purchases, get paid About what they paid total up to that time, pay no tax on any of this, and walk away with the top people Rich for the rest of their lives, their Children’s and grand children’s lives..

And if they are LLC…They wont be held responsible for what the corp did.

Anonymous Coward says:

Personally, I’d like AT&T’s "4G" to not only actually be good enough for streaming of Youtube "720p" videos, but for there to actually be cell coverage at all on all state & national highways.

The panic over 5G is laughable to me. It’s that way for most Americans too. The point of wireless is that you would actually be able to use it somewhere other than sitting at home or in a very limited area. Look, 5G coverage at Starbucks. So everyone knows how great it is I’ll loudly state that I don’t even NEED wifi, I’m that rich and cool. 5G is meaningless (with the exception of use by construction workers, who work mostly in rich parts of town, to make their down time more enjoyable).

ECA (profile) says:

Re: Re:

Look at the maps..
I live in rural area, NEXT to the freeway, on a corner..4 antenna around the town.. these should be the ones with a 40 mile range, and you can tell it by the End of the signal in the back roads.
Tons of the trucking companies use the Cell towers around the freeways to track the truckers, along with GPS.. and its Silly, when the truckers get a call and asked, WTF are you doing in Alabama(2000 miles away)..

nerdrage (profile) says:

AT&T is in trouble

AT&T and Comcast have the same problem: Netflix thwacked TV distribution upside the head, so that cable and broadcast as content distribution mediums are now finished. They are being replaced by streaming.

But streaming is not nearly as lucrative than broadcast and cable, so now AT&T and Comcast have to adjust to a new reality where they’re just not going to be able to squeeze as much money out of customers as they did in the past.

In compensation, now they have a global audience they can reach directly, in theory. So they can’t make as much per customer but there’s a whole hell of a lot of new customers right?

Except that Netflix and Amazon got there first, and Disney is moving fast (and their real platform is Disney+Hulu so forget the excuse that Disney is just for kids; they could supplant Netflix as the dominant streamer globally).

Customers are already getting aggravated by "too many streaming services." They opt for 2 or 3 big ones (I just mentioned them 3 big ones) and then stop. They pirate or ignore what they can’t get from those platforms. With some variation in what people want, I figure there’s room for 4 majors but not too much more than that.

Which means if AT&T wants to carve out room at the table for HBO Max (its best shot), they need to shove AppleTV+ out of the way. And Comcast can just forget about it entirely. With HBO and DC to play with, AT&T has a decent shot but Comcast has nothing like that and they’re behind all the other competitors. They won’t catch up.

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