DirecTV Now will elevate costs and bundle in HBO beginning subsequent month

DirecTV Now is gearing up for a price hike that will see customers pay an additional $10 per month, but receive an HBO subscription in return.

AT&T is restructuring the current packages that DirecTV Now subscribers have access to, and replacing them with two new options, according to Cord Cutter News. The first package, DirecTV Now Plus, will offer more than 40 channels, including HBO, for $50 per month. The second package, DirecTV Now Max, boasts more than 50 channels (also including HBO) for $70 per month. Both price tiers are $10 more per month than what current DirecTV Now subscribers pay. DirecTV Now subscribers will be alerted to the price hike on March 12th, and the change will take effect on April 12th.

Bundling in HBO also seems like a way for AT&T to try to gain subscribers at a time when DirecTV Now could use some. AT&T announced that DirecTV Now shed more than 267,000 net subscribers in the fourth quarter last year. CEO Randall Stephenson told investors it was to be expected as AT&T phased out promotional pricing, but acknowledged the product was on a good path.

“It’s been a year of learning what the market demands,” Stephenson said about DirecTV Now. “As we matured the project, we looked at the customer segment at the low end using promotional pricing, who were not engaging with the product. We told you in November there were 500,000 on the promotional pricing, and we started allowing those customers to attrit out. Now we have a customer base on the streaming that is growing and is highly engaged. We actually like where we are in terms of how we’re angling the streaming product.”

Although AT&T is bundling HBO into DirecTV Now subscriptions, the telecom giant is also preparing to launch an entirely new streaming service built around HBO. WarnerMedia’s streaming service, which is set to launch in beta mode by the end of the year, will introduce three new streaming subscription packages that will center around HBO. AT&T and WarnerMedia are also planning to invest $150 million into more original content for the network, which will see a 50 percent increase in original content.

As the streaming wars gear up, with DirecTV Now and WarnerMedia’s streaming services needing to compete with Netflix, Apple, Amazon Prime, and soon Disney+, having more content exclusive to one network is crucial. Even former HBO president Richard Plepler acknowledged that HBO needs to continue producing the quality of entertainment it’s known for but in a much bigger quantity. Plepler admitted at a town hall that “more isn’t better, only better is better — but we need a lot more to be even better.”

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