AT&T planning to launch web TV with multiple tiers in Q4

AT&T and DirectTV is the next mega-corp to confirm it will begin testing web TV.

Matt Rourke, AP

AT&T will offer a nationwide web TV service with several different offerings in the fall of 2016, the carrier announced on Tuesday.

The service will be offered in three tiers: full-featured, mid-tier "mobile first", and a free version with ads.

It will only work on smartphone, tablet, Smart TV, streaming media hardware or PC. You don't have to be an AT&T phone customer to sign up.

AT&T won't confirm what networks and programs the web TV service will offer, however it's said to be comparable to Dish's Sling TV already offered by its rival.

"These new video subscription models reflect the flexible content choices, viewing options and simple, transparent pricing that consumers want. AT&T intends to be the first company to deliver that flexibility, along with an effortless customer experience," John Stankey, CEO of AT&T Entertainment Group, said.

AT&T said the content will be "much of what is available from DirecTV today." According to CNET, it could be a full replacement for cable TV.

The draw of web TV services is the ability to cut down costs from cable TV providers who offer too much content. Younger viewers are seeking cheaper bundles of content, like through HBO for $14.99 a month and Netflix for $11.99 a month.

"We intend to offer customers a quality pay-TV experience, including top channels, sports and more, with increased value and flexibility of pure online streaming," Stankey told CNET in a statement.

AT&T will continue to provide DirecTV's satellite TV service.

"This is mostly about giving cord-cutters a way of staying with AT&T and maybe capturing some of the users that don't pay for TV," Jan Dawson, an analyst with Jackdaw Research LLC, told Bloomberg News. "The question is cannibalization. You have customers paying a lot for boxes and programming that they don't watch; they may decide this offer is more attractive."