AT&T to launch a low-cost streaming service on Apple TV, various devices “within weeks”

AT&T and its streaming service DirecTV Now plan to launch a ‘skinny bundle’ of television channels without sports on various streaming devices, including Apple TV, that will cost $15 a month but be free to AT&T wireless customers.

The service, called AT&T Watch, was announced Thursday by Chief Executive Randall Stephenson, shown above, who revealed the news during his testimony in the ongoing antitrust case against AT&T’s and Time Warner’s proposed $85 billion merger, being held in Washington.

The new service would be meant to appeal to a more budget-conscious streaming audience and Stephenson said the plan is to launch the service “within weeks.”

Stephenson gave few other details of the planned service, not revealing the number of channels, if the service will carry local network affiliates, or if the service will offer other features such as cloud recording capabilities that are currently in beta testing on the companies DirecTV Now service.

It is not know how AT&T Watch will be distributed, but it makes sense for the lower-cost package to be offered through the existing DirecTV Now streaming service with access to certain channels simply turned off for those subscribing customers. DirecTV Now currently offers four different streaming packages ranging from $35 to $70 a month for between 60 and 120 channels through one app on Apple TV.

The AT&T Watch package would be similar to the competitive service Philo, which currently offers a $16-a-month bundle of 37 cable channels and has been available since last November. The service is currently not available on Apple TV, but is expected to launch late this summer on the platform. Philo does not offer sports programming such as ESPN and NBCSN, which have high subscriptions rates that are passed on to customers.

Stephenson’s testimony and the announcement came as the judge in the case asked him questions focused on the Justice Department’s contention that a merger would ultimately raise prices for consumers by forcing content providers to pay more to get their programming broadcast on AT&T services like DirecTV Now.

Stephenson used the AT&T Watch announcement as evidence that his company has no intention of using its dominance to raise prices, pushing back on the government’s claim that the combined company would use “must have” channels as a “weapon” to extract higher fees from rivals and therefore pass the costs on to customers in the form of higher prices.