Watch Freeks banner

1 - 12 of 12 Posts

·
Administrator
Joined
·
24,243 Posts
Discussion Starter #1
http://www.fool.com/investing/gener...s-doing-with-dir.aspx?source=eogyholnk0000001

AT&T (NYSE:T) remains the last wireless carrier clinging to the idea of two-year contracts and it's using a version of that strategy with its newly purchased satellite TV brand.

In these deals, customers get a hot, new phone at a discounted price paying more for service over a 24-month period to reimburse the company for the "discount." AT&T is mostly sticking with that model as it begins offering bundles that include service from its recently acquired DirecTV brand.

It's not exactly the same since there is no top-tier phone in the mix, but the company's promoted deals for new customers joining the satellite TV service involve a two-year commitment. Whether you want just pay TV or a bundle with phones included, AT&T wants users to sign a contract that keeps them around for 24 months.

Other companies may have abandoned this strategy, but AT&T looks to be doubling down and betting that the promise of paying less -- at least for a while -- will get people to sign on the dotted line.

What is AT&T doing?
While wireless contracts were built around customers getting access to top-tier smartphones at subsidized prices, the game is a little different when selling satellite TV. Since there is no hot satellite dish that people see as a status symbol, a subsidy won't work as a way to entice people to sign a two-year contract.

Instead AT&T is using a similar tactic, the teaser rate.

In this scenario the company advertises a low price for the first 12 months. The catch is that the deal is for 24 months and the price skyrockets in the second year. For example, the company's "All In One" plan comes with over 145 digital channels, up to four TVs with DVR, up to four smartphones, and 15GB of shareable data for $200 a month.

The $200 number during the promotional period is in itself a little bit misleading. It does not include any actual phones (you have to buy or finance them) nor does it account for a number of little fees (which is typical for the phone and pay TV industries). It's also impossible to determine what the cost for the package will be in the second year as AT&T only says that it will charge the "then-prevailing" price for TV service.

It does admit that the cost will go up and it provides roughly a page of hard-to-decipher tiny-type disclaimer text explaining how things work in terms that are less than clear.

This type of offer is also how the company sells stand-alone satellite TV service. In this case though since the lack of a bundle makes the offer less complex it appears the initial $50 rate for its "Select" package jumps to $85 after the promotional year. The top-tier "Ultimate" package offers a $75-a-month teaser rate jumping to $122 in the second year.

Using teaser rates is confusing if not intentionally deceptive and it's surprising that AT&T insists on keeping up the practice.

It's time for a change
It's worth noting that DirecTV used teaser rates and two-year deals before AT&T purchased it. It's possible to secure service without making a two-year deal, but the company makes that unpleasant with setup charges, equipment deposits, and other tactics which make it unlikely anyone would even try to avoid a two-year deal.

Essentially AT&T is betting that customers will look at the teaser rate and not be able to imagine that someday tomorrow will come. That's always been a safe bet with American consumers, but the changing wireless phone industry suggests that people may be becoming more savvy.

It would make more sense for AT&T to just offer a good price with a discount on the monthly rate in exchange for customers committing for 24 months. If you pay $50 a month for the first year and $100 a month for the second, you're paying an aggregate monthly fee of $75 and the company should just charge you that.

AT&T isn't doing anything other than what it has always done, but perhaps the public has gotten to the point where it will reject it. There are other choices for pay TV in most cases and consumers may not be blinded by short-term deals anymore.
 

·
Registered
Joined
·
1,190 Posts
I dont have any TV services other than Netflix and amazon prime which i view via a roku. I do have ATT which I will dump as soon as i can. Problem is I need the best coverage possible nationwide. I just started trying to figure out the answer to that question.
 

·
Registered
Joined
·
489 Posts
I've been a long-time AT&T customer simply because my unlimited data plan has been grandfathered in every time I get a new phone. If that ever goes away, I'm saying goodbye to AT&T.

As for TV, my cable and internet services are bundled. I don't necessarily like the company that provides it (Comcast) and I'd rather get Google Fiber or some other similar alternative, but it's not available in my city (yet). As soon as any of the fiber services becomes available, I'm jumping ship.
 

·
Registered
Joined
·
8,308 Posts
As for the AT&T/Direct TV deal.
They will advertise 200 channels, but in reality, you'll only get 175.
Much like their internet service speed.
 

·
Administrator
Joined
·
24,243 Posts
Discussion Starter #5
AT&T has a new program for apartments and condos that allows you to get the NFL Sunday ticket only for mobile devices and computers (NFL To Go). I was able to qualify using my Arizona townhouse address. After all these years, I'll finally get to see all the games this year and not be stuck with just the local teams. This is about as excited about football as I've been in years. Now if the Packers can just stay healthy during the last preseason games.
 
  • Like
Reactions: spanky1

·
Registered
Joined
·
489 Posts
AT&T has a new program for apartments and condos that allows you to get the NFL Sunday ticket only for mobile devices and computers (NFL To Go). I was able to qualify using my Arizona townhouse address. After all these years, I'll finally get to see all the games this year and not be stuck with just the local teams. This is about as excited about football as I've been in years. Now if the Packers can just stay healthy during the last preseason games.
+1 on the Packers. I have Aaron Rodgers as my primary QB in a fantasy football league with a few friends.
 

·
Registered
Joined
·
526 Posts
Had direct tv for 9 years and att, since 87 when it began as mcCaw, became att, the cingular and finally att again. Now use a large cable company and cellular 1 where i save a ton.
 

·
Registered
Joined
·
265 Posts
We here in Dania Bch, Fl are stuck with Comcast because there is nothing else but satellite. I have a bundle package also TV internet and phone for $160 per month. They have been nothing but a PIA but as I said there is nothing else. Satellite here sucks always out when it rains or we have a storm.
 

·
Administrator
Joined
·
24,243 Posts
Discussion Starter #9
I live is a section of NJ that will never get Fios. Back in the day, the powers to be designated a small section of NJ a Verizon free zone. I live in that small section. I was told by somebody very high up the Verizon chain that if they can't sell their triple package they won't ever come into the area because it would cost them too much to build the infrastructure without being able to sell all their services. So we are stuck with Comcast and DirecTV or Dish.

As bad as Comcast is, I think it is 100 times better than Cox. Cox is what I have in AZ. They are just awful. Everything about them is awful. Service, customer service, equipment, on and on......

My business cell phone is Verizon, but I use Project Fi for my personal cell phone and love it. The Nexus 6 is a monster, but once you get used to it then you find out that it is really a great phone. And Google takes care of the Nexus owners first. We can get the Beta version of Marshmallow now or wait until next month for the full release to Nexus users.
 

·
Registered
Joined
·
1,758 Posts
Some of us are almost boxed into ATT
I I've in a black area, no reception at all
A block over its there, but I can't get it so
ATT owns the line and doesn't let other use the faster downloads etc.. I just stuck

Then while seeking something to watch lately, I started to remove the clutter by hiding all channels I never watch.
300 is down to less than twenty

I also find I have to pay a station like CNN even if it is hidden

So crazy yet in California we all have to just ignore the socialism and get on with it
 

·
Registered
Joined
·
650 Posts
I've been a long-time AT&T customer simply because my unlimited data plan has been grandfathered in every time I get a new phone. If that ever goes away, I'm saying goodbye to AT&T.

As for TV, my cable and internet services are bundled. I don't necessarily like the company that provides it (Comcast) and I'd rather get Google Fiber or some other similar alternative, but it's not available in my city (yet). As soon as any of the fiber services becomes available, I'm jumping ship.
I'm in the exact same boat; I've been with AT&T for 8 1/2 years and still have my unlimited data. If they try to discontinue that, I'll transfer my numbers to a prepaid service since a lot of them offer unlimited everything for less money than what I'm paying now. My cable services and internet are bundled and sadly, there is no other service in the area I can use. :(
 

·
Premium Member
Joined
·
19,341 Posts
Here's What AT&T Is Doing With DirecTV

Girlfriend and I just dumped directTv. We now have xfinity bundle for home phone, cable and wifi. Had Verizon before and the wifi speeds were horrible as no fios available where we live.
As far as cellular, we are all on sprint..I have a different plan though but will be switching to the iPhone for life plan through sprint in September


Sent from my iPhone using Tapatalk
 
1 - 12 of 12 Posts
Top