Reports say that subscriber losses are piling up at the Dish Network. Last quarter, Dish Network lost about 116,000 subscribers, when at the same time, their prime rival, DirecTV, added 323,000 subscribers. experts say that the subscriber losses of Dish Network are masked by a major factor.
Subscribers of over-the-top service of Dish Network, Sling TV, are also added to the same subscriber category as the satellite TV service. With the launch of many competing over-the top services from YouTube, Hulu, and AT&T, Sling TV won’t be able to support the subscribers number of Dish as much.
Dish Network did not disclose the number of subscribers of Sling TV; however, by the end of last year, Sling TV had about 60,000 subscribers. Analyst Craig Moffett says that Sling has gained another 135,000 subscribers in the first quarter, 49,000 in the second, and 204,000 in the third quarter. These estimates on the subscriber base bring the subscriber count of Sling TV to about a million. However, the total subscriber count of Dish fell to 13.643 million by the end of the third quarter, meaning that Sling TV offers a big portion of the subscriber count of Dish Network.
In addition to that, the lower subscriber prices of Sling TV has also not prevented Dish from raising the price of the their satellite TV packages. The average revenue per subscriber of Dish has climbed 3.6% per year to reach 89.44 dollars a month at present. Moreover, the management of Dish claims that they are able to generate similar type of operating profits from the Sling TV network compared to their satellite business due to the low customer acquisition costs. The operating income has climbed 12% in the last quarter.
It is expected that AT&T will launch their DirecTV Now service later this month. This service will offer more than a hundred channels to the subscribers for just thirty-five dollars a month. Comparatively, the Sling network also offers different tiers that are priced at twenty dollars and twenty-five dollars per month and offer between 20 and 30 channels. Users can also subscribe to both for forty dollars per month. However, DirecTV Now poses a great threat to Sling.
What is more, Hulu and YouTube are also launching similar streaming services. YouTube has hundreds of millions of people visiting their website each day and Hulu has a market of twelve million subscribers. This will mean that increasing or even maintaining the subscribers of Sling TV will be difficult for Dish Network, and with the losses that they take from the satellite business, subscriber losses could continue for Dish Network.