No Locals: DirecTV Gives Customers Ability to Opt Out of Local Programming

DirecTV shook things up over the weekend when it announced new plan options that allow subscribers to opt out of receiving their local stations and save money on their monthly bill.

It’s called the No Locals package, and DirecTV said customers who choose not to receive their local stations directly from DirecTV and instead access programs online, through subscription services or OTA can save approximately $140 annually. It also recommended that any customers interested test out the option over the summer during non-peak programming months, and said they can go back to receiving those local stations directly from DirecTV at any time.

Current DirecTV customers must call customer service to switch their local package configuration while prospective or new customers can sign up for whatever package they’d like online. Existing customers will be able to manage their local package online soon. Any pricing differences will be prorated based on whenever customers make those changes and will appear as a discount on a customer’s bill by the next cycle.

To be clear, this doesn’t mean DirecTV is going to stop carrying these local stations. It is bound by retransmission consent agreements and must-carry and fully plans to continue offering them as part of its lineups. The real change is in putting more choice into the hands of consumers when it comes to accessing more niche content.

This isn’t the first time DirecTV has stirred the pot in recent months. It lost TEGNA stations in November, and it was at that time that DirecTV revealed a pitch that broadcasters offer access to their stations a la carte or allow MVPDs to negotiate directly with ABC, CBS, Fox and NBC for national network content. TEGNA and DirecTV ultimately came to a multi-year retrans consent deal encompassing the broadcaster’s 64 owned stations in 51 Nielsen-designated markets that did not incorporate the operator’s somewhat revolutionary proposals with TEGNA calling the changes “not productive.”

Beyond TEGNA, DirecTV also experienced a week-long blackout of Cox Media stations before striking a new deal hours before Super Bowl LVIII began. During that dispute, DirecTV and U-verse customers lost 13 CMG stations including CBS stations in Dayton, Ohio and Seattle.

As for why now is the time to introduce these packages, DirecTV Chief Content Officer Rob Thun said in a statement that consumers have been voting with their wallets for years that pay TV as it exists today is too expensive and restrictive. DirecTV also pointed to an American Television Alliance survey released in September where 92% of participants said the cost of a video subscription was important in their decision to subscribe to video content.

In the same survey, 78% of respondents, including 78% of sports watchers, preferred an approach to cable subscriptions that included a choice to opt out of expensive specialty channels entirely over an approach that includes packages and expensive specialty channels within all channel bundles.