AT&T Reconfigures Digital Tiers

5/26/2002 8:00 PM Eastern

Taking its cue from frustrated subscribers and inundated customer-service representatives, AT&T Broadband will reconfigure its digital packages.

The new platform emphasizes more nonpremium packages to help attract analog users who aren't interested in the plethora of pay TV services already offered via digital, said AT&T Broadband vice president of video products Steve Bouchard.

Among the networks benefiting from the new structure are Wisdom Television, Nick Toons, G4 and the Fox Sports Digital Networks, all of which will gain slots within the MSO's digital packages.

Beginning July 1, the MSO's current à la carte, genre-driven digital packages — "Movies and Music," "Sports & Information" and "Family and Variety" — will give way to the more inclusive "Variety" and "Premier" packs.

The Variety pack will feature 24 networks, including: three Discovery digital channels; such African-American targeted networks as Major Broadcasting Corp., New Urban Entertainment TV and the Word Network; MTV's The Suite diginets, such as MTV Jam, Nickelodeon Games and Sports and Nick Toons; and A&E Networks' The History Channel International and The Biography Channel.

Other networks will include The Outdoor Channel, Techtv, Toon Disney, Trinity Broadcast Network, Great American Country and Inspirational Life.

AT&T's Premier pack includes BET on Jazz, the Fox Sports Digital Networks and Fox Movie Channel, GoodLife TV, the International Channel, MuchMusic, Trio, Newsworld International, Ovation, Speed Channel and Sundance Channel.

The Variety and Premier packs will be available on an à la carte basis in most markets, for $5 each. They are also included in AT&T's new Digital Standard package, which also houses 25 digital basic channels, the Encore multiplex services, an electronic programming guide, 38 digital music channels and 40 pay-per-view channels. The digital standard package retails between $50 to $52 per month.


Also new to the lineup is the digital starter package, which includes an electronic programming guide, 38 digital music channels, 40 pay-per-view channels and the Encore plex channels. The package, priced between $40 and $43, will serve as an introduction to digital for analog subscribers, or as a lower-cost alternative for digital subs who may be thinking about dropping a more expensive offering, Bouchard said.

The MSO will retain its Digital Bronze, Silver, Gold and Platinum packages. AT&T will add the Variety pack to the Digital Silver package ($59 to $60) and the Digital Gold package ($68 to $70). Both the Variety and Premier packs will be included in the Digital Platinum package ($78 to 80).

AT&T made the changes in an effort to attract more non-premium subscribers to digital basic. Though the MSO has been successful in drawing premium users to digital, it has struggled to lure subscribers interested only in basic cable.

Indeed, 84 percent of AT&T's remaining analog-only customers don't subscribe to a pay service, according to AT&T Broadband senior vice president of programming Allan Singer.

Bouchard said the MSO's packages have been ineffective in driving non-pay subs to digital — subscribers were either confused by the various offerings or wanted greater choice of networks within each package.

"The genre tiering didn't work in real life as it did on paper," Bouchard said. "People didn't have those strict viewing patterns — they had interests in networks across all of the genre packages."

To enhance the value of its digital packages and lure new digital subscribers, AT&T will add alternative health and self-improvement network Wisdom Television and video-game network G4 to its digital basic lineup.

"These are networks that are different from anything that we offer, and appeal to demographic groups that are hard to reach," Singer said. "They offer original content that you can't get anywhere else."

Neither Singer nor the networks would reveal specific licensing fee agreements. Executives also would not speculate on the future status of the deals if the proposed AT&T Broadband-Comcast Corp. merger is approved.

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