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AT&T Plans to Launch Online Video Service under WarnerMedia

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AT&T’s new streaming service

AT&T (T) is planning to launch a direct-to-consumer streaming video service under WarnerMedia. The details are expected to be disclosed in the fourth quarter. The plan would expand its existing portfolio of online video services that already includes DirecTV Now and WatchTV.

AT&T’s CEO Randall Stephenson noted during the Goldman Sachs 27th Communacopia Conference, “There is an amazing library of media and entertainment content that is really not being put to work, that’s available for direct-to-consumer distribution.”

AT&T’s plan for a new streaming service is coming at a time when the Walt Disney Company (DIS) is also underway with preparations to introduce a direct-to-consumer streaming video service in 2019 to counter Netflix (NFLX).

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Global market for SVOD

According to Future Market Insights, the global market for SVOD (subscription video-on-demand) services such as AT&T’s DirecTV Now and Netflix is growing steadily. By 2026, the research firm forecasts that the global SVOD market could be worth $108.6 billion, up from $48.9 billion in 2015, as shown in the above chart.

Other companies competing for this revenue opportunity are Hulu and Dish Network (DISH). As of June 30, Dish’s Sling TV service has attracted 2.3 million customers, putting it ahead of AT&T’s DirecTV Now with 1.8 million customers. Netflix has 57.4 million paying customers in the United States.

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