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T-Mobile's Foray Into Pay TV Looks a Lot Like a Cable Bundle

Scott Moritz

(Bloomberg) -- T-Mobile US Inc., which rewrote the rules for mobile service with offers like free data for life, is taking on the pay-TV business using a throwback approach: A cable-like bundle of channels and a set-top box.

Ignoring the trend toward less or no hardware, T-Mobile is introducing TVision, a cookbook-size box that must be plugged into home broadband connections. The $100-a-month, in-home TV package will be offered in eight cities, starting with 150 channels, including local broadcasts and regional sports networks. Some streaming apps like Netflix and Amazon Prime Video will be loaded on the device, though they’ll require separate subscriptions. Premium channels like HBO will also cost extra.

Entering a crowded field with a plain-vanilla pay-TV package seems like an odd move at a time when consumers are canceling cable for cheaper services like Netflix. But T-Mobile is calling TVision the first step in a bigger plan. The company plans to eliminate the box eventually and will offer a wireless TV service in the coming months that will be anchored, at least at this stage, by programming from Viacom Inc.

T-Mobile is stepping into the fray using Layer3, a company it acquired last year. At $90 for the service and $10 per box, it isn’t the cheapest alternative. The service will be available in Chicago, Dallas-Fort Worth, Los Angeles, New York, Philadelphia, San Francisco and Washington, along with Longmont, Colorado.

Termination Fees

The company is targeting customers of Dish Network Corp. and AT&T Inc.’s DirecTV by offering to pay off early termination fees for consumers who switch.

Eager to gain U.S. approval for its $26.5 billion takeover of Sprint Corp., T-Mobile has argued that the combination of the two companies will create a stronger TV and broadband competitor, especially with the expansion of 5G networks.

John Legere, T-Mobile’s chief executive officer, promised to have a “disruptive new TV service” last year, but shelved the plan due to the project’s complexity and promised something more groundbreaking this year.

To contact the reporter on this story: Scott Moritz in New York at smoritz6@bloomberg.net

To contact the editors responsible for this story: Nick Turner at nturner7@bloomberg.net, Rob Golum

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