Sling TV Q3 Sub Growth Cools; Dish TV Sub Loss Increases

Dish Network Nov. 6 said it added 203,000 Sling TV subscribers during the three months ended Sept. 30, down 5.2% from the addition of 214,000 subs during the same period in 2019. This decrease in sub additions was primarily related to lower Sling TV activations, increased competition, including competition from other SVOD and live-linear OTT service providers, and delays and cancellations of sporting events as a result of COVID-19.

Dish ended the quarter with 2.46 million Sling TV subs, which is down 8.6% from 2.69 million subs a year ago.

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At the same time, Dish lost 87,000 legacy pay-TV subscribers, 32% more than a sub loss of 66,000 last year. This increase in subscriber losses primarily resulted from lower Dish subscriber activations, partially offset by a lower churn rate.

The Colorado-based satellite TV operator ended the period with just 8.96 million pay-TV subs, down almost 6% from 9.49 million subs the same time last year.

Dish Lost Record 413,000 Q1 Pay-TV Subs; Sling TV Down Too

Citing the ongoing coronavirus health care crisis, Dish Network May 7 said it lost a record 413,000 pay-TV subscribers in the first quarter (ended March 31). That included 250,000 commercial accounts the satellite TV operator suspended due to a lack of sports programming and shuttered retail establishments. Dish lost 259,000 pay-TV subs in the previous-year quarter.

Meanwhile, Dish’s pioneering online TV platform, Sling TV, ended the quarter with 2.31 million subs — down from 2.42 million subs during the previous-year period. The company closed the quarter with 11.32 million pay-TV subs, including 9.01 million Dish subs.

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Net income attributable to Dish Network totaled $73 million for the quarter, compared with $340 million from the year-ago period.

“We have faced, and could continue to face, fewer subscriber activations and increased subscriber churn rate as a result of the COVID-19 pandemic and the worsening of the global business and economic environment,” Dish said in a statement.

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The distributor said the pandemic caused “severe disruption” in certain commercial segments, including the hospitality and airline industries — both virtually shut down since March.

CEO Charlie Ergen has called for a refund from Disney-owned ESPN due to a lack of live-sports programming, among other grievances.

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Private Equity Group Looking to Acquire DirecTV and Dish Network

Private equity firm Apollo Global Management is reportedly negotiating to acquire AT&T’s satellite TV service, DirecTV, along with competitor Dish Network.

The complicated transaction would enable AT&T to offload about $20 billion in debt, while maintaining control of the satellite service. It would also allow Dish Network CEO Charlie Ergen to unload the company’s declining pay-TV business, according to Fox Business, which first reported the story based on information from sources familiar with the situation.

Ergen, who has recently moved the company’s focus toward wireless networks and 5G, has made no secret his desire to combine the two satellite businesses.

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AT&T, which acquired DirecTV in 2015 for $49 billion, also purchased Time Warner for $85 billion, sending its debt load into the stratosphere.

Apollo, which has about $250 billion in its asset portfolio, would provide financing for the deal in exchange for a minority stake in the combined entity. The firm specializes in leveraged buyout transactions and purchases of distressed securities involving corporate restructuring, special situations, and industry consolidations.  Its holdings include Caesars Entertainment Corporation, CareerBuilder,  ADT and Rackspace.

AT&T told Fox it has received the offer but that there were no active discussions at this time.

COO John Stankey, who is also CEO of WarnerMedia, last month reiterated AT&T’s support DirecTV and over-the-top video unit, AT&T TV Now.

“We’re constantly looking at the [business] portfolio,” Stankey told The Wall Street Journal. “That’s the normal course of business and it’s not unique to DirecTV.”

 

Dish Adds 48,000 Sling TV Subs in Q2

Dish Network may be getting into the wireless business, but in the meantime, it remains a pay-TV operator.

The company July 28 announced it added 48,000 net Sling TV subscribers in the second quarter ended June 30. That compared to a gain of 41,000 subs in the previous-year period.

Sling TV, which ushered in the standalone online TV market in 2015, ended the quarter with 2.47 million subs – up 128,000 subs from 2.34 million subs last year.

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“The increase in net Sling TV subs was primarily related to higher Sling TV sub activations, partially offset by increased competition, including competition from other OTT service providers,” Dish wrote in the fiscal filing.

Separately, Dish’s legacy satellite pay-TV service continues to lose customers. It lost 79,000 net subs, which was an improvement over 192,000 subs lost during the same period last year.

Dish ended the quarter with 12.03 million subs — down 965,000 subs from 12.99 million subs in the previous-year period.

The company has lost 290,000 satellite TV subs in the first six months of the 2019 fiscal year. That compared to a loss of 245,000 subs during the same period in 2018.

“The decrease in pay-TV subs resulted in fewer Dish TV subscriber losses and higher net Sling TV subscriber additions,” Dish wrote.

Regardless, the steady downward spiral in pay-TV subscribers contributed to a near 28% decline in Q2 net income at $317 million from $438 million last year.

Revenue declined 7.5% to $3.16 billion compared to revenue of 3.42 billion last year.

Dish Consolidates Satellite TV Holdings

Dish Network May 20 announced it is combining certain EchoStar operations and other assets that comprise the company’s satellite business, including nine direct broadcast satellites and the certain key employees responsible for operations.

The 22.9 million stock transaction, which includes select real estate properties, will be distributed to EchoStar shareholders.

Dish in 2017 acquired select EchoStar assets to better deliver linear pay-TV and online platform Sling TV to subscribers. Key broadcast satellite operations and services remained with EchoStar, which is also owned by Dish chairman Charlie Ergen.

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“This transaction brings those operations, including the BSS satellites, associated assets and key team members, in house and we expect those additions will create operational efficiencies and improve both free cash flow and pre-tax earnings,” Dish CEO Erik Carlson said in a statement.

The transaction is structured to be a tax-free exchange and is expected to close in the second half of 2019, subject to satisfaction or waiver of closing conditions.

Dish Widens Q1 Pay-TV Sub Loss as Sling TV Growth Cools

Dish Network May 3 reported it lost 266,000 pay-TV subscribers in the first quarter, ended March 31. That compared to a loss of 185,000 subs in the previous-year period.

The nation’s fourth-largest pay-TV operator ended the period with 12 million subscribers — down almost 1.1 million subs from 13.1 millions subs last year.

The loss reflects ongoing secular changes in the pay-TV market as increasing numbers of consumers opt away from linear television toward over-the-top video products such as Netflix, Amazon Prime Video, Hulu, HBO Now and Showtime OTT, among others.

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Separately, Dish’s pioneering online TV service, Sling TV, added just 7,000 subs in the period, compared to a gain of 91,000 subs last year. The standalone live streaming service ended the period with 2.41 million subs compared to 2.3 million subs last year.

Sling TV helped create an online TV market targeting cord-cutters and millennials that now includes PlayStation Vue, Spectrum TV Plus, DirecTV Now, YouTube TV, Fubo TV and Hulu with Live TV, among others.

While subscriber growth declined, revenue per Sling customer increased. The increase was mainly driven by three factors: Customers taking higher priced packages, increased add-on revenue from extras, ad sales and cloud DVRs, and the $5 increase on the orange package implemented in the third quarter of 2018.

“Sling’s promotions have done well for us but we are focused on attracting profitable customers,” Warren Schlichting, EVP and group president, Sling TV, said on the fiscal call. “It’s a marathon not a sprint. We like where we are, we like our position in the market with our competitors taking their prices out that’s only improved ROI, and you’ll see more of the same, in the second quarter from us.”

Without Sling, Dish’s legacy satellite TV subscriber base would be about 9.6 million – down almost 4 million subs (30%) in the past five years.

Dish Network Lost 1.1M Satellite Subs in 2018; Sling TV Growth Cools

Dish Network, the fourth largest pay-TV operator in the country, Feb. 13 said it lost 1.1 million legacy satellite TV subscribers in the fiscal year ended Dec. 31, 2018. The company lost 995,000 satellite subs in 2017.

Dish ended 2018 with 9.9 million satellite subs, compared to 11 million at year-end 2017.

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The company said its pioneering online TV service Sling TV added 205,000 subscribers last year – down 72% from 711,000 subscriber additions in 2017. Sling added 878,000 subs in 2016. The standalone streaming service finished 2018 with 2.41 million subs compared to 2.21 million in 2017.

 

 

Dish Network Expands On-Demand Content Offerings

Dish Network has expanded its on-demand offerings by more than 7,000 titles, including adding 11 à la carte on-demand packages users can subscribe to on a monthly basis, priced from $2.99.

The on-demand packages include original series and documentaries from Up Faith & Family, Cinedigm’s Dove Channel and Curiosity Stream, among others.

On-demand subscriptions are available to Dish customers with a qualifying programming package and an internet-connected Hopper DVR (all generations), Hopper Duo, Joey (all models) or Wally.

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“Dish’s on-demand universe is all-encompassing,” Andy LeCuyer, SVP of programming,” said in a statement. “Whether bingeing seasons of your favorite TV series on-demand or purchasing a digital copy of a new release movie, there are many avenues for customers to access the content they want, when they want it.”

Indeed, more than 70,000 of on-demand titles are available at home on a Hopper family set-top box, and while on-the-go with the DISH Anywhere app.

The DISH Anywhere app gives all customers the ability to watch the on-demand titles associated with their programming package from virtually any location. The app is available on Internet-connected mobile devices, including smartphones, tablets and computers, as well as televisions via Amazon Fire TV and Android TV.

The following on-demand subscriptions are now available to Dish subscribers, with a free preview available through Feb. 10.

Parks: Confidence in Online TV Increasing Among Younger Consumers

Following a fiscal quarter that saw pay-TV operators lose about 1 million combined subscribers, new data from Parks Associates finds consumers’ willingness to recommend their service (net promoter score, or NPS) is waning.

The average NPS for traditional pay-TV providers in the third quarter was minus 19, down from minus 15 in Q1, although some providers such as Optimum and Dish Network improved their individual scores.

By comparison, the average NPS for the major online pay-TV and over-the-top video services was positive, although their overall scores declined from 2017 to 2018.

“The percentage of U.S. broadband households that do not subscribe to traditional pay TV increased from 16% in 2011 to 22% in 2017,” Brett Sappington, senior director of research, said in a statement. “With each quarterly earnings report, pay-TV providers and their stakeholders are hyperaware of variances in subscriber figures, and they are trying to reverse this trend with their own brands of OTT services as well as other value-added services. A positive NPS score for these services suggests a positive perception and strong word-of-mouth activity.”

Parks said 79% of U.S. broadband households reported had traditional pay-TV subscriptions in early 2018. About 33% of pay-TV subs made a change to their service between Q1 2017 and Q1 2018.

 

 

 

 

 

 

 

 

 

“A key challenge for pay-TV providers is to design and launch services that will inspire loyalty among younger households,” said Sappington. “Older consumers profess higher loyalty to pay-TV providers, whereas younger households are more likely to have an OTT service.”

 

DirecTV Launching Proprietary Streaming Media Device in 2019

As expected, DirecTV plans to roll out a proprietary streaming media device in 2019 that would enable consumers to access online TV service DirecTV Now using their own broadband or high-speed Internet connectivity.

The device, which would be similar to a Roku or Apple TV device, would help DirecTV reduce subscriber acquisition costs typically associated with the installation of pay TV service, including truck rolls and employees climbing the roof installing satellite receivers.

Speaking Nov. 14 at the Morgan Stanley European Technology, Media & Telecom confab in Barcelona, AT&T CFO John Stephens said the streaming device would afford DirecTV with the same data insights and targeted advertising (driven by data analytics subsidiary Xandr) as linear pay-TV.

“It’s a device that allows us to instead of rolling a [service] truck to the home, we roll a UPS or FedEx truck to the home,” he said.

The executive said the box would help AT&T boost broadband subscriptions, which currently total about 15 million households.

“We certainly hope it’s our own fiber, but it can be on anybody’s broadband,” Stephens said.” “We are testing it with employees today.”

Charter Communications followed a similar strategy in 2015 when it launched standalone online TV service Spectrum TV Plus to broadband customers. New subs were given a free Roku 3 streaming media device to facilitate the $20 monthly service.

Separately, Stephens said oral arguments in the Justice Department’s appeal of the $85 billion AT&T/Time Warner merger are due Dec. 6 – with a decision by the three-judge panel expected next year.

“Quite frankly, we’re confident the decision will be upheld,” he said. “It’s a process we have get through. But we’re not spending a lot of time thinking about it.”