AT&T screens TV's cordless future

Published Thu, Mar 3 20162:59 PM EST

Breakingviews

Jennifer Saba

AT & T just took the TV battle right to King Cable. In its first big move since buying satellite operator DirecTV for $49 billion, the U.S. telecommunications titan is rolling out a video service that bypasses the set-top box. Its rivals have similar designs on the market and are making it ever easier to cut the cord. Though programming and pricing details are sketchy, AT & T this week unveiled plans for three packages. The $234 billion company stumbled over television with its clunky U-verse offering, but may have another chance with its deep pockets and new acquisition. DirecTV, for example, lays claim to a coveted package of rights to NFL games. If included, they'd be a huge draw for any mobile service. At the same time, Verizon is teaming up with media powerhouse Hearst, a backer of BuzzFeed, in a new venture that will tailor programming for younger viewers on its video-streaming service go90. T-Mobile's "Binge On" plan invites users to stream Netflix and Hulu without chewing up any of their high-speed data allotment. Wireless phone companies can be their own worst enemies. TV services could end up in a similar web of confusion as phone contracts. The opportunity is immense, however, as consumers increasingly grow frustrated about paying for expensive bundles of programming they mostly don't watch. Half the U.S. population, or some 164 million people, will stream video this year, according to research outfit eMarketer. More from Breakingviews : Flawed Aubrey McClendon changed the energy world Cable operators till now generally have felt safe despite the upheaval. High-speed internet affords them a natural hedge against changing TV habits. Even in large U.S. markets, there is a dispiriting lack of choice of broadband providers. The telecom companies, however, offer an alternative method of delivery. AT & T also is working on building out the next-generation 5G wireless network that promises faster connections. A U.S. government auction of spectrum later this month should be instructive. The airwaves will fetch up to $35 billion, JPMorgan analysts estimate. Verizon, AT & T, T-Mobile, Dish Network and others are expected to raise their paddles. Bidding against them may be Comcast, the largest U.S. cable company, which recently started dabbling in mobile. It hasn't participated in a spectrum auction since 2001, though. The TV fight could escalate quickly. For more independent commentary and analysis from Reuters Breakingviews, visit breakingviews.com . Disclosure: Comcast is the owner of NBCUniversal, the parent company of CNBC and CNBC.com.

A pedestrian walks past an AT&T sign in New York.

Scott Mlyn | CNBC