World news – T-Mobile is reducing TV service plans

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T-Mobile

TMUS 0.38%

US Inc. is scrapping its efforts to break into the home television market on its own after the wireless company failed to turn its thin bundle of channels into a profitable service.

The wireless operator announced on Monday that it would be discontinuing TVision on April 29th and will instead direct its mobile customers to Google’s YouTube TV.

Rival online video packages from

Sony Corp.

SNE 1.12%

and others have ceased operations or raised prices for live TV services to keep up with programmers who continue to raise their fees.

T-Mobile launched a revamped version of its TV service last year, to serve the base of mobile communications customers – after that the second largest in the country

Verizon Communications Inc.

VZ 1.12%

It also targeted existing cable subscribers and the millions of U.S. households who have cut TV subscriptions from their bills, opting instead to purchase a broadband Internet service as a standalone item and opt for a variety of video services such as TV and TV subscriptions

Netflix

NFLX 1.16%

and Disney.

The new product is designed to complement T-Mobile’s broadband Internet home service, which will be available to the general public later this year.

So-called virtual pay-TV services, which are provided entirely online, have problems getting their way.

AT&T Inc.

T 0.82%

The offering – a service originally launched as DirecTV Now that delivers channels over the internet without satellites – has shrunk since peaking at nearly two million subscribers in 2018. PlayStation Vue, a TV service from Sony, was discontinued last year.

TVision was the mobile operator’s second attempt to enter the pay-TV industry after purchasing Layer3 TV in 2018 for $ 325 million. The company has accumulated the rights over the past two years to broadcast enough traditional live TV channels to compete with its larger cable television competitors.

T-Mobile has written off most of Layer3’s value over the past year and cited a new strategy based in part on recently acquired content rights. Layer3 delivered live TV channels to a small group of customers, but its expensive and cable-like delivery system slowed its growth.

T-Mobile executives said the service had an enthusiastic following. However, shortly after the launch, some programmers complained that the channels offered were leaner than they should be. T-Mobile later added more channels to the service, adding to the telecommunications company’s costs.

Live TV is one of several sweeteners that T-Mobile has offered to its core base of cellphone customers in recent years. In previous promotions, Netflix and the now defunct Quibi service were bundled with customers’ cell phone bills.

Appeared in the print edition of March 30, 2021 as « T-Mobile to give up its online TV service ».

Ref: https://www.wsj.com

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