As competition heats up, AT&T sweetens Unlimited Plus plan with free HBO

AT&T said it will give all of its Unlimited Plus wireless customers free access to HBO. The offering comes as competition heats up in the wireless space and analysts lower their expectations for carriers’ first-quarter performances.

AT&T said its free HBO offer will apply to any customer who subscribes to its Unlimited Plus plan, whether they also pay for its DirecTV service or not. Specifically, AT&T explained that:

  • If an Unlimited Plus customer already pays for HBO through U-verse or DirecTV, that fee will now be removed
  • If an Unlimited Plus customer subscribes to an AT&T video service like DirecTV Now but not HBO, HBO will automatically be added
  • And if an Unlimited Plus customer doesn’t have any video services from AT&T, they will be able to access HBO content through AT&T’s DirecTV Now app or the HBO Go app

“People who want the best in entertainment want HBO. This latest unlimited wireless plan shows AT&T continuing to innovate and give customers what they desire,” Bernadette Aulestia, executive VP of global distribution for HBO, said in a release from AT&T.

AT&T’s new “Unlimited Plus” plan costs $90 for a single line and includes 10 GB of tethering per smartphone (after 10 GB, max speeds will be slowed to 128 Kbps), as well as the option to connect a tablet and other devices for $20 a month. And Unlimited Plus customers can also get discounts on AT&T’s DirecTV services.

Of course, hanging over the new promotion is AT&T’s pending $84.5 billion purchase of HBO parent company Time Warner. That deal has not yet been consummated, though market observers don’t expect it to run into any major regulatory obstacles, and the companies continue to expect to close the transaction by the end of this year. The move would marry a telecom giant with a media powerhouse and potentially pave the way toward more content and service bundles like the combination of AT&T’s Unlimited Plus plan and HBO.

AT&T’s new offer is noteworthy considering some Wall Street firms are lowering their expectations for the first quarter due to the fierce competition in the wireless sector. For example, Jefferies recently lowered its expectations for AT&T’s Q1 earnings per share from 77 cents to 74 cents, and reduced its expectations for AT&T’s postpaid net adds from 112,000 to 72,000, based on weaker-than-expected handset sales and the shutdown of its 2G network. The firm described the competitive intensity in the market—largely focused around new unlimited data offers—as “what appears to be more than just a seasonally soft gross add quarter.”

To be clear, AT&T isn’t the first, or the only, carrier to bundle content alongside its services. For example, T-Mobile just this week started offering a free MLB.TV Premium subscription for the 2017 MLB season.

Indeed, this isn’t even the first promotion featuring HBO content—last year, Verizon announced that new or upgrading customers would be eligible to receive three free months of HBO Now service—a move that was noteworthy in August of 2016 considering the 6th season of HBO's popular "Game of Thrones" series was scheduled to start later that month. 

The seventh season of HBO’s "Game of Thrones" is scheduled to start in July.