Microsoft has been getting a lot of buzz this week with the launch of Microsoft Phone 7. They’ve lined up two U.S. carriers to feature the new mobile OS – AT&T and T-Mobile. AT&T’s carriage of the new Microsoft Phone platform is no surprise, but one thing it intends to do with it may be quite surprising.

What didn’t get as much fanfare this week is AT&T’s announcement of U-Verse TV access on both the X-box gaming platform and on Windows Phone 7 smartphones. The idea of accessing U-verse TV content on both a game console and a smartphone isn’t groundbreaking news. But what is of particular interest is AT&T’s offer of U-Verse TV over the Windows Phone 7 smartphones to anyone, regardless of whether they are an AT&T U-verse subscriber.

For a $9.95 monthly subscription, anyone with a Windows Phone 7 can access the U-verse Mobile app, which allows subscribers to “download and watch hit TV shows on your smartphone.” AT&T doesn’t give details about how much content is actually available through the Windows Phone 7 version of U-verse Mobile App, but previous versions of it restricted content to whatever AT&T has mobile ‘rights’ to. When they launched U-verse Mobile App for the iPhone, content was limited to select shows from PBS Kids, Disney, ABC, ABC Family, ABC News, Disney XD, ESPN, Discovery Channel, Animal Planet, and TLC. This list may have expanded by now.

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This experiment will be one to watch. One could view this development as a subscription OTT distribution model by an existing video service provider (VSP) – something that hasn’t been tried before. Many existing VSPs are trialing OTT video delivery, but usually it’s limited to their paying wireline video subscribers. AT&T is now making the option available to anyone (with the right smartphone). If it should hold some promise, how long before it expands, allowing anyone with an iPad or an Xbox to pay AT&T $9.95/month for access to video content?

Of course, all of this hinges on what content is available. If the U-verse Mobile App doesn’t offer access to content beyond what’s already freely available on say Hulu or myfitv, then any potential promise probably fizzles out before it gets started. But if AT&T (and others who might follow this path) are able to negotiate rights to a more compelling content mix for OTT distribution, this may be the opening salvo for a subscription OTT model by an existing VSP.

It’s something many analysts have pondered with TV Everywhere. When/if the model is perfected, what’s to stop Comcast (or others) from rolling out its TV Everywhere package to anyone with a broadband connection and a willingness to pay a monthly fee, greatly expanding their reach and footprint? Looks like AT&T may be opening the door for just that.

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One thought on “AT&T Experimenting with Subscription OTT Video Model through New Microsoft Phone

  1. Bernie- I wasn't clear from your article, will you be able to access U-Verse content on the XBox even if you aren't a U-Verse customer by paying the subscription fee (like on the Windows 7 phone) or do you have to already be a U-Verse customer to get content on the Xbox? (Therefore its really just a STB replacement for one of my TVs)

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