Dish Network Owner Eyeing U.K. Satellite TV Market?

NEWS ANALYSIS — On the heels of 21st Century Fox, the Walt Disney Co. and Comcast collectively coveting U.K. satellite TV operator Sky, Denver-based EchoStar Corp. is also gazing across the pond.

Headed by Charlie Ergen, majority owner of Dish Network, EchoStar reportedly made an offer for Inmarsat, a London-based satellite telecommunications company with more than $1.4 billion in revenue in 2017.

While Inmarsat’s stock price jumped 14% following the undisclosed financial offer, the company considered it below its market value and rejected it.

“It very significantly undervalued Inmarsat and its stand-alone prospects,” the company said in a June 8 statement. “The board remains highly confident in the independent strategy and prospects of Inmarsat.”

Unlike Disney, Fox and Comcast’s interests in Sky’s 10 million pay-TV subscribers, Ergen is more interested in Inmarsat’s radio spectrum portfolio.

As media distribution increasingly becomes wireless, spectrum plays a key role in how that distribution channel works. Most major industries rely on wireless technologies that depend on spectrum access to function, including cellular, broadcast and satellite.

In the United States, regulatory responsibility for the radio spectrum is divided between the Federal Communications Commission (FCC), and the National Telecommunications and Information Administration (NTIA).

In 2017, Ergen reportedly spent $6.2 billion acquiring spectrum rights in government auctions – second only to T-Mobile. Dish reportedly owns about $35 billion worth of spectrum rights in the U.S., despite not yet operating a wireless network – as do Verizon, AT&T, T-Mobile, Sprint and Comcast.

Cellular distribution was one of the reasons Dish acquired the bankrupt Blockbuster Video chain in 2011. It had hoped to use the video store’s retail footprint to jumpstart branded and third-party mobile devices. That strategy stalled in 2013 when Dish shuttered the remaining Blockbuster-owned stores.

In 2015, Dish Launched Sling TV, the industry’s first online TV service. With more than 2 million subscribers, Sling TV represents Dish’s future as traditional linear TV declines.

With AT&T launching DirecTV Now, Charter operating Spectrum TV Plus, and Disney bowing ESPN+, Ergen has voiced interest in launching a wireless network by 2020 to better accommodate Sling TV to mobile consumers.

A year ago, Comcast did just that bowing Xfinity Mobile – a wireless service targeting the cabler’s 25 million broadband subscribers.

“Wireless is hyper competitive,” Dave Watson, CEO of Comcast Cable, said last year.“We will measure our success very differently than other wireless carriers. It will be designed to support the core cable business.”

Indeed, Ergen has similar designs involving Dish Network, and could license his spectrum portfolio or use it as leverage to entice merger and acquisition offers from third parties. Last December, Ergen stepped down as CEO of Dish to focus on wireless. Maybe that will include revisiting the Inmarsat offer.

Sling TV Adds ‘Cheddar Big News’

Sling TV, the Dish Networks online TV platform, June 7 announced it would begin streaming Cheddar Big News, an upstart general news network focused on headlines and top stories.

The network covers news of the day, human interest stories, weather, science and sports. It includes updates on business, politics and government from its Washington D.C. office and entertainment from Cheddar’s Los Angeles location. Cheddar claims its political coverage is neutral.

“We have always been supportive of Cheddar’s vision to disrupt the way news is delivered, which is why we launched the initial [Cheddar] financial news channel on Sling TV in 2016,” Ankit Bishnoi, VP of content acquisition and strategy at Sling TV, said in a statement.

Cheddar content partners include AccuWeather, FanSided, Stadium and VSiN.

“Sling TV … saw the vision and bet on our team and content before anyone else,” said Daniel Schneider, VP of business development of Cheddar. “They are extremely innovative.”

Cheddar Big News, which is also available on Philo and YouTube TV, recently signed Coke as its first corporate sponsor.

Research: Customers More Satisfied With Video Streaming Than With TV Subscription Services

Customer satisfaction with video streaming services far eclipses that of subscription TV service, according to the American Customer Satisfaction Index (ACSI) 2018 Telecommunications Report.

Video streaming services debuted in this year’s telecom report with an ACSI score of 75, well above subscription TV’s score of 62, which declined 3.1% from last year.

“Video streaming services significantly outperformed subscription TV,” said David VanAmburg, managing director at the ACSI, in a statement. “Streaming services don’t have the hidden fees and six-month rates that subscription TV does, not to mention they’re cheaper and simpler. But because consumers don’t have many options when choosing a subscription TV provider, those businesses don’t see a lot of risk in customer dissatisfaction, and we’re unlikely to see dramatic changes any time soon.”

The American Customer Satisfaction Index (ACSI) measures and analyzes customer satisfaction with more than 380 companies in 46 industries and 10 economic sectors. Reported on a scale of 0 to 100, ACSI scores are based on data from interviews with roughly 250,000 customers annually. The ACSI Telecommunications Report 2018 includes data on subscription TV services, video streaming, video-on-demand, internet service providers, fixed-line and wireless telephone services, and cell phone manufacturers. It’s based on 45,292 customer surveys collected between April 19, 2017 and March 17, 2018. The full report is available for download here.

With an ACSI score of 75, video streaming services were the highest-performing telecom industry measured in the 2018 study. Netflix, Sony PlayStation Vue, and Twitch all led the pack, tying at a score of 78. Apple iTunes and the Microsoft Store took second place at 77, with YouTube Red in third at 76.

Amazon Prime Video, Google Play, Hulu, and Vudu all registered at the industry average of 75, followed by the network channel subscriptions: CBS All Access at 74, and HBO Now and Starz at 72.

Bringing up the rear were Sling TV (71), DIRECTV NOW (70), Showtime Anytime (70), and Sony Crackle (68).

Still, even Sony Crackle in last place rated higher than nearly all subscription TV services.

Video streaming services received high marks for ease of understanding the bill (80), website satisfaction (80), and call centers (75), but customers downgraded them on availability of the current season’s TV shows (71) and availability of new movie titles (69).

Customer satisfaction with subscription TV fell to 62, an 11-year low for the industry.

AT&T’s U-verse TV topped the list with a 70, one of only two scores that stayed the same instead of dropping. Verizon Fios fell 4% year over year to a 68 for second place, while DISH Network held steady at 67 for third.

In the middle of the pack, DIRECTV and Optimum both fell 6% to 64 and 62, respectively. Cox Communications shed 2% to 60, while Spectrum and Suddenlink both plunged 8% to 58.

Comcast Xfinity decreased 27% to 57, Frontier Communications dropped 7% to 56, and Mediacom placed last with a 55, down 2%.

The top-rated part of the subscription TV experience was HD picture quality, which holds steady at a score of 80. Picture quality was close behind, down 1% to 78.

While courtesy and helpfulness of store and service center staff had a relatively good score of 77, and speed of store and service center transactions received a 76, call center satisfaction continued to be the weak spot of the industry, slipping 3% to 63.

“If you look at retail, airlines, and many other industries, companies like to reward customer loyalty, offering perks or discounts for doing business with them,” said VanAmburg in a statement. “Telecom is the exact opposite. In many ways, loyalty is punished because subscription TV is focused on customer acquisition and offering the best deal to lure customers away from competitors. In the long run, that doesn’t leave customers very satisfied.”

Among video-on-demand services, AT&T’s U-verse TV took the top spot with a 74, followed by DISH Network at 73, and Verizon Fios at 72. At 70, AT&T’s DirecTV came in far below its U-verse offering, but ahead of the industry average.

Optimum led all cable companies in video-on-demand at the industry average of 68, while Cox Communications and Xfinity tied at 67, and Spectrum came in last at 64.

Video-on-demand viewers were pleased with the number of TV shows (75), current seasons (74) and variety by category (74) available. However, the availability of a past season’s shows was lacking (69) as were free on-demand content (69) and new movie titles (68). Call centers received the lowest marks (67), but call center service performed better for on-demand customers than for internet and subscription TV.

While video streaming services received much better customer satisfaction scores than subscription TV, obviously viewers still need internet access to get it. Unfortunately, internet service providers (ISPs), along with subscription TV, had the lowest customer satisfaction of all industries tracked by the ACSI.

ISPs were down 3.1% to 62, and while customers clearly weren’t satisfied with their service, more than half of Americans had only one choice for high-speed broadband. Every major ISP deteriorated this year except Xfinity, which remains unchanged.

Verizon Fios stayed in first place at 70 after a 1% dip. AT&T Internet also fell 1% for a second-place score of 68, followed by Optimum, which dropped 6% to 64.

Suddenlink and Spectrum both plummeted 8% to 61 and 60, respectively, followed by Xfinity, unchanged at 60. Mediacom placed last with a 53 after a 9% fall from last year.

Call center satisfaction, already low, fell another 3% to 59. Customers were also less satisfied with overall data transfer speed, which sank 3% to 67, and the variety of internet plans available, which fell 3% to 64. The one bright spot was courtesy and helpfulness of store and service center staff and speed of store and service center transactions, at 76 and 74, respectively, though both were down from last year.

Report: Multichannel Subscriptions Fall Slightly in Q1, But Get Virtual Lift

Combined cable, direct broadcast satellite (DBS) and telecom multichannel subscriptions fell 0.8% sequentially in the first quarter ended March 31, to 93.2 million, including 90.3 million residential customers.

That’s according to the Q1 2018 U.S. Multichannel Subscriber Report by Kagan, a media research group within S&P Global Market Intelligence.

However, noteworthy gains for virtual platforms DirecTV NOW and Sling TV cut the quarterly subscription losses in half, raising the overall residential figure to 94.1 million.

Other findings:

  • The residential multichannel penetration rate stood at 76.1% as of March 31 when including the virtual smartphone platforms owned by AT&T and DISH Network (DirecTV NOW and Sling TV).
  • Cable operators logged their largest first-quarter video subscriber decline on record, with the top two multiple system operators, Comcast and Charter, accounting for 59% of the drop.
  • Telco video appears to be regaining its footing as AT&T’s U-verse stabilizes. The platform’s video customer losses fell below 100,000 for the first time since the third quarter of 2015.
  • DBS losses ramped back up in the first quarter, bringing the sector’s total down to 31.1 million.For more information, visit www.spglobal.com/marketintelligence.

Research: OTT Service Subscribers to Grow to 400 Million in 2018

Over-the-top services will reach a subscriber base of 400 million in 2018, according to ABI Research’s recently released Service Provider OTT Services and Set-top boxes Update report.

ABI forecasts that OTT video services will put more pressure on traditional pay-TV services, especially in the developed markets with high broadband and pay-TV penetration. The worldwide OTT video market is expected to grow at CAGR 10% to generate $51.4 billion in 2022, according to ABI.

“OTT video services offer less expensive alternatives and no long-term contract features compared to existing pay-TV offerings that are driving an increasing number of Pay-TV customers to switch to these OTT services,” according to ABI.

In markets such as North America and Europe, pay-TV operators have jumped into the OTT market to improve churn by providing less costly video service. DirecTV’s Now, Dish Network’s Sling TV, and Sky’s Now TV are among the operators which offer Virtual Multichannel Video Programming Distributor (vMVPD) services, linear channels via internet connection, according to the report.

“vMVPD services offer live TV packages as low as $10 and customized packages are attracting cost-sensitive customers,” said Khin Sandi Lynn, industry analyst at ABI Research, in a statement.

Dish Network’s Sling has secured more than 2 million subscribers in the two years since it launched, the report noted. DirecTV Now has gained 1.2 million subscribers within one year of its launch, offsetting the subscriber loss of its satellite TV platform.

“Pay-TV operators recognize the consumer demand for vMVPD services and are trying to expand their OTT offering by providing more content choice to compete against other subscription OTT services such as Netflix,” Lynn stated.

Despite the low cost of basic vMVPD packages, the availability of live sports packages and customization features contribute the higher ARPU compared to other subscription OTT services, according to the report. Hulu and YouTube launched live streaming packages in 2017 creating more competition in the vMVPD market.

“As competition intensifies, content and quality of service are crucial to win the OTT war,” Lynn stated.

Sling TV Tops 2.3 Million Subscribers

Pioneering online TV service Sling TV May 8 disclosed it added 91,000 subscribers in the first quarter (ended March 31). It ended the period with more than 2.3 million subs.

The service, launched in 2015 by Dish Network, was the first to offer standalone access to premium pay-TV channels, including ESPN, with a long-term contract.

Sling TV has been joined by PlayStation Vue, Spectrum TV Plus, DirecTV Now, YouTube TV, Fubo TV and Hulu Live, to create an online TV market aimed at attracting cord-cutter and millennials.

Indeed, Dish said it lost approximately 94,000 subscribers in the quarter, compared to a decline of about 143,000 in the previous-year period.

The comparison is misleading considering that without Sling, Dish lost approximately 185,000 pay-TV subs. The satellite TV operator closed the quarter with 10.8 million subscribers compared to more than 11 million last year. When combined with Sling TV, Dish’s total pay-TV sub base topped 13.1 million compared to 13.5 million subscribers at the end of first quarter 2017.

Lone bright spot: Dish’s average monthly subscriber churn rate (subs not renewing service) was 1.47% compared to 1.92% for first quarter 2017.

 

NAB: 70% of PlayStation Vue Streaming on Non-PS Devices

About of 70% of subscriber streaming on PlayStation Vue occurs through non-PlayStation devices, Dwayne Benefield, VP, head of PlayStation Vue, told attendees April 11 at the Streaming Summit at the NAB Show in Las Vegas. About 80% of streaming is for live TV.

Launched in 2015 by Sony, PS Vue joined Dish Network’s Sling TV attempting to redefine pay-television over the Internet with standalone service offering access to premium channels, including local, without long-term contracts.

The platforms have since been joined by DirecTV Now, Hulu With Live TV, Spectrum TV Plus, YouTube TV and Fubo TV looking to replicate traditional broadcast online with a-la-carte pricing.

Benefield said the average Vue subscriber streams five hours of content daily. While the PS Network has 70 million subscribers across 165 countries, Benefield did not disclose specific subscriber numbers for Vue.

The executive said online TV platforms are getting increased stacking rights to catalog episodes of TV shows as creators and distributors recognize the growing market appeal of online TV.

Benefield said there remains value in the traditional pay-TV bundle, but that online TV represents a growing, cost-effective alternative.

“As [the bundle] does fray, you’ll see us add more a la cartes,” he said in the keynote, as reported by Multichannel News. “I think [online TV] can succeed without broadcast.”

Comcast Begins Streaming SlingTV International on X1 Set-Top Devices

As expected, Comcast has begun offering Xfinity subscribers direct access to Sling TV’s multicultural programing.

First announced last November, the agreement between the nation’s largest cable operator and satellite operator Dish Network (which owns Sling TV) underscores Comcast’s expansion beyond its walled pay-TV ecosystem. The cabler currently offers direct-access to Netflix, Pandora, YouTube and NPR podcasts.

“And today, we’re excited to add another choice to the platform with the launch of the Sling International app on X1,” Rebecca Simpson, executive director international strategy and programing at Comcast Cable, wrote in an April 5 blog post.

Sling International offers multicultural content from different countries in 21 languages starting at $10 per month.

Available languages include Arabic, Hindi, Tamil, Telugu, Malayalam, English, Marathi, Kannada, Punjabi, Urdu, Bangla, Bengali, Brazilian, French, Italian, German, Polish, Vietnamese, Cantonese, Taiwanese and Mandarin.

Existing Sling TV customers will be able to log in and access any of the international live or on-demand programming that’s part of their current package.  New customers will be able to sign up directly through the Sling International app on X1 at www.sling.com/international.

Kagan: Pay-TV Sub Loss Softened in Fourth Quarter 2017

The pay-TV business model may be under siege, but subscriber losses actually slowed for traditional multichannel video providers in the fiscal quarter ended Dec. 31, 2017 – while declining for the full year, according to new data compiled by Kagan, a group within S&P Global Market Intelligence.

Combined cable, satellite TV (Dish Network and DirecTV) and telecom multichannel subscriptions fell to 94 million, including 91.1 million residential customers. Combined, cable, satellite and telecom subs are now down approximately 7.4 million from their peak in 2012.

The total multichannel count, including the top two virtual service providers Sling TV and DirecTV Now, is at 97.3 million.

Cable operators lost an estimated 986,411 video subscribers in 2017, more than twice the 2016 drop. That broke the sector’s three-year streak of decelerating video subscriber losses.

The telecoms (AT&T, Verizon) slowed their net subscriber losses for a third consecutive quarter. The sector shed 903,262 subscribers in 2017 to end the year at 10.6 million.

The satellite sector was down nearly 1.7 million subscribers in 2017 – the biggest annual loss on record, as DirecTV joined Dish Network in posting traditional subscriber declines.

Sling TV Updates Roku Navigation

Dish Network-owned Sling TV has launched new updates on Roku devices for easier navigation.

With in-app upgrades, customers can now add extras and premium channels to their account within the app by selecting their desired content from the in-app upgrades ribbon under “Add Channels & More” on the My TV screen.

Customers can now add on-demand channels to MyChannels, including Nat Geo Wild, Fandor, as well as on-demand content from NBC and Fox for Sling Blue customers who do not live in a market where linear content is available.

Favorite channels (indicated by a heart in the guide) are now shown first at the top of the “Grid Guide” and on the left of the “Channel Guide” and the new “Micro Guide.”

The company has reduced the size of the guide (called the “Micro Guide”) that appears while watching a show, so it takes up less of the screen. The full guide is still available by pressing “down” on the remote’s D-pad when watching a title.

Sling TV has changed the full-screen video navigation, so now pushing “up” on the D-pad will bring up the “Micro Guide” and pushing “down” on the D-pad will now bring up the old guide.

When pressing the “Exit” button on the remote, customers will now see a pop-up giving them the option to go back to their show or movie instead of leaving Sling TV.

To aid binge-viewing, Sling TV has updated the player view so when customers are watching an on-demand title, the app will automatically go back to the franchise page of the show they watched.

The changes are detailed on Sling TV’s blog.

Separately, Dish has selected The Richards Group as its new creative agency of record. The Dallas-based Richards Group was chosen following a comprehensive agency review.

“The Richards Group brings to the table a history of successful campaigns, breakthrough creative and a unique set of capabilities necessary to take the Dish brand forward,” Jay Roth, CMO and SVP of Dish, said in a statement. “Throughout the agency review process, Dish and The Richards Group discovered natural synergies between our two founder-led organizations, and we’re eager to bring the results of this partnership to market.”