AT&T Defends Fee-Free DirecTV Streaming to AT&T Mobile Devices

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Randall Stephenson, chairman and chief executive officer of AT&T
Randall Stephenson, chairman and chief executive officer of AT&T  Credit: Misha Friedman/Bloomberg

Railing against claims of anti-competitive behavior, AT&T today defended its program to allow DirecTV Now subscribers to stream content to AT&T devices without incurring additional data charges.

"This is another example of how there's a service that's been put in the market that has been incredibly popular," said CEO Randall Stephenson in his keynote speech at the UBS Global Media Conference in New York today. "There are decades of precedent on this type of pricing mechanism; there is absolutely nothing new here."

AT&T launched the streaming television service DirecTV Now last week, and interest among customers has so far exceeded expectations, Mr. Stephenson said.

Last week, in a letter to AT&T, the FCC suggested the telecom giant was engaging in anticompetitive practices by offering unfair advantages to its streaming video content above those from other providers by allowing its customers to stream DirecTV content without counting it toward their data caps.

"The Sponsored Data program strongly favors AT&T's own video offerings while unreasonably discriminating against unaffiliated edge providers and limiting their ability to offer competing video services to AT&T's broadband subscribers on a level playing field," wrote FCC Wireless Communications Bureau Chief Jon Wilkins in a letter to AT&T Senior Executive Vice President Robert Quinn last Thursday.

Mr. Stephenson said he is hopeful for a change of direction from a new administration.

"I do believe that under a Republican Commission, this is an issue that probably wouldn't get a whole lot of attention," he said.

AT&T's acquisition of streaming television provider DirecTV, approved last summer, is part of the company's plan to acquire long-form content, and the company's $85 billion merger deal with Time-Warner is a completion of the strategy, Mr. Stephenson said.

The company's CEO emphasized that its marriage with DirecTV could be a boon for advertisers beacuse of its opportunities to reach a growing customer base.

AT&T is banking on continuing interest among its customers in premium content streaming.

"We have strongly felt that people are overestimating the demise of premium long-form content," he said. "We think we're in the golden age of TV, and premium long-form content on a mobile device is going to be of huge demand."

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