It happens every year, just like clockwork. Believe me I don’t like writing this article, but I do because you should know what’s coming up. AT&T has announced their yearly price increases and it doesn’t look bad. Of course no price increase would be better, but that’s really not an option unfortunately. I’ll explain more below. But first, let’s get to the detail.
Price changes for residential customers
Residential customers will see the following increases:
- Basic Choice, Basic: $1/month increase
- Preferred Choice: $3/month increase
- Select, Entertainment: $5/month increase
- Mas Ultra: $6/month increase
- Choice, Total Choice, Total Choice Limited: $7/month increase
- Xtra, Preferred Xtra, Choice Xtra Classic: $8/month increase
- Ultimate, Premier: $9/month increase
However, Showtime, Starz, and Cinemax will be reduced in price by $3 each if you subscribe to them a la carte.
All new prices will go into effect January 17, 2021.
More details can be seen here.
I have yet to see an announcement for commercial customers but I expect the packages to rise by a similar amount.
Is it really that bad?
Really, if you look at these price increases, they aren’t that bad. Even a $9 increase on a package that nominally starts at about $240 for people off contract isn’t that bad. Of course having no increase is going to be better. Of course some folks will say this is the last straw and cancel. But overall I think most people will just accept it, because even with yearly price increases DIRECTV is still a great value.
Why do price increases happen?
You can make a lot of arguments… too much labor, costs of operations, need to show a profit to shareholders, but there’s really one core reason that prices for pay TV keep rising. Pure and simple, it’s content costs.
It’s pretty amazing that for a company that launches massive satellites into space and has tens of thousands of customer service people, their biggest expense is still content. AT&T has to negotiate with thousands of different content providers every time there’s a new contract needed. Generally that’s about once every three years, for every single broadcast source. Those lawyers do keep busy.
And yes, sometimes new contracts mean that there are higher prices. They’re kept to a minimum but sometimes there simply are price increases. With hundreds of channels, even a one penny increase per channel can add up.
Some folks just don’t see the whole picture
Content providers keep asking for more money even though live TV ratings drop every year on average. They’re reaching fewer people, yet they want to charge more. On the one hand, you have to admire them for asking. That takes some guts. But really I think there are two possibilities here. One, some people just don’t get it. Maybe they think the internet is just a fad. The other option, probably more likely, is that they’re trying to get their prices increased while they can because they know they’re running out of time.
But no matter what, even though I hate to be the bearer of bad tidings, at least I can say that these price increases are small enough that they really are barely noticeable.