The second-quarter earnings report of Dish Network revealed that the network suffered a huge loss, of around 281,000 customers, which included both satellite and Sling TV streaming service. This is the biggest quarterly subscriber loss ever in the history of Dish Network and this loss has raised numerous questions regarding the growth of the service.
Dish Network did not provide separate breakouts of the subscriber loss for its satellite and streaming services. While Sling services are available to the customers from a starting rate of $20 per month, the satellite providers have to pay approximately four times this amount on an average basis.
In a research report, an analyst at MoffettNathanson said, “Dish’s dismal Q2 results in their core business suggest that there is less sand in the hourglass, faster than we thought, Dish combines the core with Sling TV, two fundamentally different businesses. Over the past year, gains at Sling TV have softened the blow of losses in the satellite core. This time, combining the two businesses likely obscures how quickly Sling TV is hitting a wall. By our estimates, Dish added just 49,000 new Sling TV subscribers.”
In a regulatory filing, Dish Network said, “Our pay-TV churn (disconnection) rate continues to be adversely affected by increased competitive pressures, including aggressive marketing, bundled discount offers combining broadband, video and wireless services, as well as cord cutting (online video). As part of our increased emphasis on retaining higher-quality subscribers, we have been more selective in issuing retention credits, which has had a negative impact on our pay-TV churn rate.”
Dish Network offers a wide range of radio spectrum to its mobile video services but they have failed to establish a partnership with Verizon Communications, T-Mobile, or Sprint, where AT&T acquired the rights for Dish’s archival DirecTV last year.
An auction of airwaves owned by local TV broadcasters begun earlier in March 2016, and Dish Network, Verizon, and T-Mobile are prohibited to engage in any strategic discussion until the conclusion of this event. Reports indicate that Dish approximately has 13.93 million subscribers as on June 30, which is around 400,000 customers less than that it had a year ago.