Why does AT&T extend your contract when you activate a receiver?

Because it just makes good sense. OK, it’s true. No one likes to be tied down to another two years. Especially if they just want to add a TV to the bedroom. Yet that’s just what AT&T and most other cable and satellite providers do. It seems unfair, but let’s look at it from both sides.

You’ve said you want to add a receiver to your account, that probably means you’re going to be hanging around anyway, so really the extra commitment doesn’t mean much on your end. But on the provider’s end, it’s a big benefit in so many ways. Take a look:

They can amortize the cost

The real cost of that receiver or DVR is quite a bit more than you’re paying, even if you’re paying the “rack rate” of $99, $199 or $299. By putting you under a commitment, AT&T can gamble on your adding additional services, and make some of their money back with the monthly receiver fees.

They can plan ahead for future needs

AT&T needs to know years in advance what their needs are, because they need to make contracts, place build orders, and be ready when you’re ready to add a receiver. Keeping people on contract makes it easier for them to plan, and when they plan right, it keeps costs down for you. Remember, AT&T hasn’t changed the prices on its receivers in nearly a decade, so they must be doing something right.

This allows them to manage their new and existing customer deals better

Asking up front for an extended commitment means that fewer people will try to play the expensive game of trying to cancel just to get a better deal. This was popular a few years ago when another web site reported that all you needed to do was say “cancel” at the voice prompt to get almost anything you want. That play was overused and AT&T really cracked down. So blame the people who abused the system.

Let’s face it, it’s because they can, but you have choices too

Yes, I’ll say it. There’s some truth to saying that these commitments have been in place for a long time. This is just how it’s done. The good news is that there are options. You can get a live streaming service like DIRECTV NOW and go completely month-to-month. More and more people are doing this.

I don’t know if we’ll see a big change to the contract system as far as the satellite TV end of things. I think that if you want no-contract, you go DIRECTV NOW and supply your own hardware. If you want a traditional pay-TV experience, which includes dedicated hardware, you are going to get a contract. At least at this point you have a choice.

Sure, it sounds like all the benefit is on AT&T’s end but you’re also getting a receiver or DVR for a low out-of-pocket expense and in that two years, you can bet on numerous upgrades and improvements, too.

Ready for an upgrade?

If you are ready for an upgrade to your satellite TV system, and you are ok with the extra two-year commitment, you will always get the best deals and the best service by going to Solid Signal! Our 100% US-based call center can deliver personalized service that AT&T just can’t. Their number is 877.312.4547.

About the Author

Stuart Sweet
Stuart Sweet is the editor-in-chief of The Solid Signal Blog and a "master plumber" at Signal Group, LLC. He is the author of over 8,000 articles and longform tutorials including many posted here. Reach him by clicking on "Contact the Editor" at the bottom of this page.