DirecTV is making a bold move by becoming the first cable and satellite company to start offering stand-alone service in hopes of retaining cable customers who are thinking about cutting the cord.
Stand-alone service means you don't have to pay for installation at your house. You get the channels through your Internet-connected devices instead. This is big, because it marks the first TV provider to start up a service like this only on the Internet. Instead of having a cable or set-top box and cords, you can download the app and pay a monthly subscription, kind of like Netflix.
The company plans to launch DirecTV Now later this fall. It's expected to prompt other cable providers to offer similar streaming channel services.
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So what's taken so long for a stand-alone service like this? The number of cable and satellite subscribers has been dropping for years. One reason is because it's expensive, averaging about $64 per month, according to the Federal Communications Commission. Compare that with the $10 to $15 for services like Netflix, Hulu and HBO Go.
The convenience to watch on your phone or tablet is also a factor. Many cable companies started offering their own digital apps for customers to watch TV, but you still needed that cable subscription. This may change that, though you'll still need access to the Internet to use the app.
DirecTV hinted that DirecTV Now will be less expensive than traditional cable because no equipment, installation or technicians are necessary. But they didn't say exactly how much it will cost.
Consumers groups say it's the first step toward unbundling, which will let consumers pick the specific channels they want and not pay for the ones they don't watch.