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March 29, 2021
Faced with a key tech partner that's in the throes of bankruptcy, T-Mobile will soon shut down its two OTT-delivered pay-TV packages – TVision Vibe and TVision Live – and instead partner with two virtual multichannel video programming distributors (vMVPDs): YouTube TV and Philo.
T-Mobile will market YouTube TV and Philo under its "TVision" umbrella brand and continue to market and sell those services via the TVision Hub, a $50 Android TV-powered streaming dongle.
Figure 1: T-Mobile's own TVision-branded pay-TV packages will be wound down, but the company will continue to sell and market its Android TV-powered 'TVision Hub' streaming dongle.
Per a new, multi-year deal with Google that factors in messaging, tighter tie-ins with the Android ecosystem and promotion of Google-made smartphones, YouTube TV has been tagged as TVision's "premium" live TV service. Meanwhile, Philo, a sports-free, entertainment-focused pay-TV service, is now billed as T-Mobile's "new base live TV service."
T-Mobile said it would wind down the TVision Live and TVision Vibe services on April 29. Tied in, current TVision Live subs will get the first month of YouTube TV for free and, after that, get the service for $10 off the regular price of $64.99 per month. Current TVision Vibe customers also get a free month of Philo, followed by a $10 discount on Philo, which typically starts at $20 per month, for as long as the customer remains with T-Mobile. To help soften the blow, T-Mobile is also tossing in three months of YouTube Premium, a service that regularly sells for $11.99 per month. This wave of TV streaming deals will run through June 30.
T-Mobile, which introduced its new TVision pay-TV streaming packages last November, hasn't announced how many subscribers have signed up so far. Sources told Light Reading that T-Mobile was able to sign up more than 100,000, plus a group of employees who were getting TVision for free.
Figure 2: Launched last November, the TVision Live and TVision Vibe services will be shut down on April 20.
In a blog post, T-Mobile CEO Mike Sievert said the move represents a "big upgrade" for customers and follows a "fresh look" at how the company handles video services with a customer-first focus.
But he also acknowledged the other huge driver behind the decision: MobiTV, T-Mobile's key TV software provider, recently filed voluntary Chapter 11 bankruptcy. Industry sources also say that there is concern that MobiTV could end up liquidating, a decision that could put other MobiTV partners, including a group of tier 2/3 cable operators, in jeopardy and force them to seek out alternative streaming partners quickly.
"With our TV software provider encountering some financial challenges and with our broader, strategic partnerships with Google and Philo, we saw an opportunity to deliver unique value to our customers and strengthen the TVision initiative with the best partners," Sievert wrote. "This industry is incredibly fragmented, with new streaming services launching all the time, and we've concluded that we can add even more value to consumers' TV choices by partnering with the best services out there, negotiating incredible streaming media deals for T-Mobile customers, and helping our customers navigate the increasingly complex streaming world."
It's not immediately known how this decision will impact MobiTV's bankruptcy restructuring plan, including $15.5 million in debtor-in-possession (DIP) financing from TVN Ventures, an affiliate of T-Mobile. Light Reading has asked T-Mobile and MobiTV for further comment.
Update: T-Mobile declined further comment on MobiTV's financial situation, and MobiTV did not elaborate beyond details that have already been disclosed in its bankruptcy filings.
But, according to industry sources, T-Mobile is letting people currently linked to the TVision product seek out job opportunities within the company as its OTT-TV services are being wound down. However, a number of people in T-Mobile's home and entertainment group not solely focused on TVision are already being reassigned to support the company's burgeoning fixed wireless home broadband efforts, the sources said.
T-Mobile did not confirm any specific plans involving employees currently involved with the TVision product, but did note that employees will help support the company's new and future streaming partners and aid in the transition of current TVision subscribers.
"This group of employees has incredibly relevant skills to where we are headed in the future – with TVision and other initiatives," a T-Mobile spokesperson said in a statement. "A big part of the future of T-Mobile is about building great customer experiences, and this team has amazing talent to help deliver that. TVision is evolving to offer customers a selection of the best in streaming. Our employees will support Philo, YouTube TV and future streaming partners as well as support other aspects of this Google partnership, including helping ensure a smooth transition for TVision service subscribers."
Expensive pay-TV missteps
T-Mobile's decision to team with YouTube TV and Philo follows a string of expensive pay-TV-related missteps by T-Mobile.
After acquiring Denver-based Layer3 TV in 2018 for more than $325 million, T-Mobile later wrote off the deal and shut down TVision Home – the big bundle pay-TV service central to that deal – on December 30, 2020. After pivoting to a new, upgraded OTT-TV service under the TVision brand, T-Mobile is now shutting those down less than six months after launch.
Introduced last November initially to its own base of postpaid mobile customers, T-Mobile's current TVision pay-TV offering started at just $10 per month. However, T-Mobile quickly encountered static from programmers such as Discovery Communications claiming that T-Mobile's new packages violated its distribution rights.
Before announcing plans to shut down its own services, T-Mobile seemed eager to bundle TVision packages with fixed wireless home broadband services. That packaging can presumably continue, though now the pay-TV piece will come from partners such as YouTube TV and Philo.
"Our experience has shown us consumers need an advocate in this space," Sievert explained. "They don't want more streaming services – they want help buying and navigating the services that already exist. And they want exclusive deals and special access."
— Jeff Baumgartner, Senior Editor, Light Reading
Senior Editor, Light Reading
Baumgartner also served as Site Editor for Light Reading Cable from 2007-2013. In between his two stints at Light Reading, he led tech coverage for Multichannel News and was a regular contributor to Broadcasting + Cable. Baumgartner was named to the 2018 class of the Cable TV Pioneers.
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