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AT&T CEO hints at launching mobile video streaming service

Randall L. Stephenson, Chairman and Chief Executive Officer of AT&T, speaks during a session at the annual meeting of the World Economic Forum (WEF) in Davos January 22, 2014. REUTERS/Ruben Sprich/Files

By Malathi Nayak and Supantha Mukherjee

(Reuters) - AT&T Inc (T.N) Chief Executive Randall Stephenson on Tuesday hinted at launching a mobile video streaming service as early as January to target price-conscious U.S. viewers who don't currently have pay-TV subscriptions.

AT&T is interested in putting together a content bundle that can be viewed on a smaller screen, or to a single screen in a home that's not set-top box-driven, Stephenson said.

"It is something we are pursuing very, very aggressively and you should assume that we will be doing something in the market with that," he said at the UBS Global Media and Communications Conference in New York.

There are about 30 million homes in the United States that do not have pay-TV subscriptions, he added.

AT&T is looking for new revenue streams as the wireless market stagnates. The online video market is a competitive space with established players such as Netflix Inc (NFLX.O) and Dish Network Corp (DISH.O) and new entrants like Verizon Communications rushing to service viewers who consume video on mobile devices.

With the $48.5 billion purchase of satellite TV operator DirecTV in July, AT&T became the No. 1 U.S. pay-TV company with over 26 million U.S. subscribers. The acquisition also gave AT&T the ability to leverage DirecTV's relationships and agreements with content providers to get mobile video streaming rights.

AT&T has already acquired rights to stream content to mobile devices for various premium cable channels such as Showtime and will deploy 40 megahertz of contiguous spectrum to relay content over its network, Stephenson said.

"We think we have about as robust an entertainment portfolio of content for our customers as any OTT (over-the-top) provider out there," he said.

To grow revenue, AT&T has expanded in Mexico after the recent purchase of the third- and fourth-largest wireless carriers in that country. Moreover, the acquisition of DirecTV has given the U.S. wireless provider a foothold in Latin America, a region that holds growth potential in pay television and mobile broadband.

AT&T is in no rush to sell its Latin America assets or enter strategic deals given the economic uncertainty in that region, Stephenson said.

"This is not the best time to even consider doing a deal ..because of the stressed valuations as a result of the economic and currency situation....There's no sense of urgency about it," he said.

(Editing by Maju Samuel and Alistair Bell)