AT&T Goes Primetime with DirecTV-Enabled LTE Tablet

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3Q 2017 | IN-4764

In a crowded tablet market with few functional differences between hardware vendors, AT&T has launched its Primetime LTE tablet featuring DirecTV Now. What are the priority audiences for this type of mobile device and how does it compare to other commercially available tablets?

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AT&T Launches Its First Branded Tablet with DirecTV Content

NEWS


Mobile network operator AT&T has introduced its own branded tablet device called Primetime. The U.S. carrier touts an entertainment-first approach, as well as meeting the needs of business customers. What are the priority audiences for this type of mobile device and how does it compare to other commercially available tablets?

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IMPACT


The Primetime tablet is powered by Android Nougat OS and is preloaded with AT&T apps and services, including DirecTV. The specifications are mainstream compared to the market-leading tablet devices from Apple and Samsung.

  • A 10-inch, TFT 1920x1200 resolution display
  • A 9,070 mAh battery with Qualcomm Quick Charge 2.0 technology to reduce the time it takes to recharge the tablet; a USB 3.0 Type-C connector is employed for easily connecting the cable to the tablet
  • 2 GB of RAM; 32 GB of storage expandable to 128 GB
  • Wi-Fi 802.11ac connectivity
  • Dual Bluetooth (BT) connections
  • Dual 5-megapixel front- and rear-facing cameras

A lot of competition already exists in the market for a 10” Android tablet priced around US$200 that is also capable of running AT&T’s DirecTV app (a free download from the Google Play app store). Some thoughts to consider include:

  • The Primetime tablet runs on Wi-Fi and AT&T’s 4G LTE network. This means access to data, web, and video content anytime and anywhere in the carrier’s mobile network. It also means that a service contract is required on top of purchasing the tablet hardware from AT&T. Existing customers can add the device to their unlimited wireless plan for $US20/month, while new service agreements could bring monthly costs down to US$10/month with a 2-year agreement.
  • The price delta for an LTE-enabled AT&T Primetime is US$50 more than the Wi-Fi-equipped Amazon Fire HD 10 tablet. Screen resolution, Wi-Fi modes, processor speed, memory, storage, battery life, and other functional attributes are very similar. Software loads vary by tablet, with AT&T emphasizing its DirecTV content offering, while Amazon focuses on the Alexa voice assistant integration.
  • Most tablets support a single BT connection at a time. The addition of dual-connection BT support for the Primetime tablet makes it a better fit for audiences looking to have two users share the audio experience.

The primary distinction for AT&T Primetime compared to other commercially available tablets is the use of AT&T software and services to tie together network data, business services, and DirecTV content.

Clarity in Market Approach Is Necessary to Win Future Tablet Buyers

COMMENTARY


At first glance, the market positioning of the AT&T Primetime tablet is simply confusing. It is marketed as both an entertainment-first tablet and as an enterprise-ready business productivity tablet. This leaves us wondering how big is the U.S. business audience that is missing out on DirecTV content during their workday. Perhaps some further audience segmentation and marketing the benefits separately to each group would lessen this confusion. When all is said and done, the AT&T Primetime tablet fits somewhere between the average consumer and enterprise mobile device user. If the concept of a prosumer audience is still a sizeable market, then Primetime is well-positioned to blend the needs of a single device that spans both work and home activities.

As a potential business device, the specifications for Primetime are indistinguishable from mid-range consumer tablets, apart from embedding a 4G LTE data modem and service. The Primetime tablet closely resembles the new Amazon Fire HD 10 launching in October 2017. AT&T bolsters the hardware with its own layer of business services, including 256-bit AES data encryption, VPN access, EMM services, and support for Android at Work. Google Docs are also preloaded for word processing and compatibility with popular office productivity software.

As a content consumption device, AT&T’s motivation to offer its own tablet is to give its highest-value customers another way to access content via DirecTV Now. Mobile viewing over cellular networks continues to grow in terms of the number of users, though the trend appears to be driven more by the use of unlimited data plans than any specific device form factors. ABI Research would be surprised if this moves the needle forward in a meaningful way for outside the home viewing or DirecTV Now growth overall. Part of the allure of these OTT services is lower cost (e.g., only paying for the channel packages you want), so adding in another monthly fee for service works against this value proposition.

Consumer choice occurs at a much more granular level than in the past. ABI Research further believes that household discretionary spending on content will grow, while at the same time, experiencing significant channel fragmentation. The distribution between incumbent players (theaters, retailers, broadcasters, cable and satellite companies, etc.) has split with new players, including Apple (iTunes), Google (Google Play Movies, YouTube), Facebook, and electronic retailers, such as Amazon and China’s Baidu, entering the battle for entertainment spending.

ABI Research initially called this device category “media tablets” in 2009 because of the usage focus on consumer consumption of content. Business audiences discounted the value of media tablets, referring to them as toys, rather than productivity devices. While much of the marketing message about tablets has changed and now places an emphasis on productivity and using the right device for the right task, tablets remain relatively isolated as a “tweener,” surrounded by the personal value of smartphones and the productivity of 2-in-1 ultraportable PCs. ABI Research expects tablets to remain the middle child of computing devices without a distinct use case.