At a time when it is promoting its high-end prepaid services at the cost of losing low-end postpaid customers, AT&T is now thinking of ways to sell its range of mobile services to as many as 15 million DirecTV subscribers who don’t use company’s mobile services at present. According to analysts at Jefferies, an American global investment bank and institutional securities firm, AT&T intends to capitalize on its $49 billion purchase of DirecTV last year and apart from offering exclusive unlimited mobile data plans, is also planning to launch a comprehensive video service later this year which subscribers will be able to access on their smartphones as well. The carrier’s unlimited mobile data service, which cost $100 for a single line and a further $40 for each new line, offered 22GB of 4G data at top speeds and unlimited data at reduced speeds and won over 2 million new subscribers just two months after its launch.
As per Jefferies’ analysts, assuming that every household with a DirecTV subscription supports at least two or three smartphones, AT&T may have significant opportunity to tap their interests. The carrier may sell its mobile services to such customers through dynamic ad insertions by using a walled garden approach. The analysts also talked about the balance that AT&T maintains between gaining prepaid mobile users and losing low-end postpaid customers. They said that AT&T does this to increase average revenue per user and to reduce churn. In the first quarter of 2016, AT&T lost 216,000 net post-paid subscribers but gained as many as 2.3 million net prepaid customers in North America. “AT&T looks at handsets on a branded basis, which when including prepaid, is relatively flat, suggesting further postpaid handset losses going forward. The company remains comfortable with the trade-off between new prepaid customers and the loss of low-end postpaid customers,” the analysts wrote.
Even though AT&T is expected to come up with a number of fresh ideas to lure DirecTV and U-Verse customers to subscribe to its mobile services, the carrier has already put some of its plans in action. Back in April, AT&T introduced a new offer for DirecTV and U-Verse subscribers which entailed that if such subscribers purchased a Samsung Galaxy S7 or a Samsung Galaxy S7 Edge handset with a new line of service, they would be awarded with a free Samsung Smart TV, namely the 48 inch Samsung J5200 Series LED Smart TV, within 45 days of purchase. While non-DirecTV and non-U-Verse customers could also take advantage of the offer, the terms of the offer mandated them to install an applicable DirecTV or U-Verse service within the promotional period of one month.