T-Mobile US has signed an agreement to acquire TV technology innovator Layer3 TV to create T-Mobile’s new TV service.
The introduction of TV service on mobile on its LTE network assumes significance because T-Mobile needs to strengthen revenue streams beyond voice and data. T-Mobile COO Mike Sievert said that the company would like to disrupt legacy cable and satellite TV’s distribution model.
John Stephens, chief financial officer of AT&T, earlier announced that DIRECTV NOW, its over-the-top video service passed the 1 million subscriber mark.
AT&T aims to address losses in the company’s traditional video customer base and continue to expand DIRECTV NOW in the OTT market in 2018. The company expects net video gains in Q4 2017, including DIRECTV NOW. AT&T is also on track to achieve $2.5 billion or more in annualized cost synergies from the DIRECTV acquisition by mid-2018.
T-Mobile does not admit that it is following the footsteps of major rivals such as AT&T or Verizon in the mobile video market. The strategy of T-Mobile is clear. It does not want to invest heavily in a new business as part of the growth strategy.
T-Mobile said it earlier offered freedom to video stream with Binge On and T-Mobile ONE, and then giving T-Mobile ONE families a free Netflix subscription included at no extra charge.
Currently, Layer3 TV delivers a product that seamlessly integrates the best of television, streaming online video content and social media and is available in five cities across the US. With Layer3 TV’s team, T-Mobile plans to launch its own new TV service next year.
Wireless customers are using 37.5 percent more data on average. T-Mobile’s LTE network speed increased 28 percent in the last year.
T-Mobile’s network continues to expand and improve with new nationwide low-band spectrum and more advanced technologies. T-Mobile was first to commit to build a nationwide 5G network and has already begun working on that by deploying 5G-ready equipment.