While giving testimony as part of the court case where AT&T is attempting to prove it should be allowed to merge with Time Warner, AT&T CEO Randall Stephenson threw a bone to cord-cutters and suggested that the company will be launching a $15-per-month “skinny” bundle aimed at cord-cutters.
It was unusual for a CEO to reveal a major new product in the middle of the court case, but now we’re starting to see why that might have been AT&T’s strategy. The skinny bundle isn’t something AT&T is doing to make money; Instead, it seems to be a chip that AT&T is putting on the table to try and push its mammoth merger through the regulatory process.
If Stephenson’s reveal of the bundle during the trial was the stick, then AT&T CFO John Stephens revealed the carrot at the Cowen and Company Technology, Media and Telecom Conference in New York yesterday. The service, tentatively called AT&T Watch, “will be based on getting the Time Warner deal done,” Stephens told attendees. The $15-a-month service will reportedly bundle some of Time Warner’s cable channels with a few other content channels, but cut out the live sports, which is often one of the more expensive channels for the distributor.
The subtle implication is that if the court doesn’t approve AT&T’s merger — the verdict is supposed to be returned by June 12th — then customers will be losing out. It’s the same playbook we’ve seen before from corporations, who promise everything from new factories to faster internet in return for tax breaks and looser legislation, only this time we’re being offered a bad TV bundle in return for a massive increase in power over the entertainment industry.