One advantage OTT streaming video services like Sling TV and DIRECTV NOW have over traditional pay-TV services is lower cost. But for how long? These two providers, owned by DISH and AT&T respectively, are both raising their monthly subscription fees. For Sling TV, the hike is a steep 25%.
DIRECTV NOW joins Sling TV with a monthly subscription fee increase of $5. Sling TV’s entry price is now $25, up from a segment low of $20/month. DIRECTV NOW is raising their starting package to $40, up from $35, and the streaming service tops out at $75 per month for their high-end package. YouTube TV also recently increased their pricing to $40 and Sony also announced a $5 increase for PlayStation Vue packages.
Sling TV and DIRECTV NOW are the leading OTT streaming services and have over 4 million subscribers collectively. While not explicitly citing upgrades to their platforms, both are raising their fees in the midst of adding features to their services.
DIRECTV NOW recently upgraded their user interface and added cloud DVR capability. Sling TV just announced a refresh of their interface as well, and also added additional a la carte channels and PPV capabilities.
It appears that $40 is the new ‘sweet spot’ for streaming OTT service, with DIRECTV NOW, YouTube TV, and Sling TV now offering packages at that price point. Sling TV’s entry point is still a lesser $25, but they do offer a $40 price point for their combined Orange and Blue packages.
We all kind of saw this coming. The lower cost fees these providers started out with were unsustainable over the long term. I suspect we’ll continue to see additional increases. After all, these services are still subject to rising content costs and retransmission fees, just like their legacy pay-TV cousins. Makes you wonder how long before streaming services are on par with legacy services, at least from a cost perspective.
This post has been updated to reflect additional OTT streaming service price increases.
