Sling TV CEO: Increased Content Should Stymie Seasonal Subs21 Jul, 2016 By: Erik Gruenwedel
Month-to-month billing is both an attraction and curse to over-the-top video. With long-term premium television contracts not a mitigating factor for SVOD subscribers stopping and restarting service, Sling TV — in an effort to reduce seasonal churn — earlier this year launched dual-stream service, in addition to licensing content from Fox Broadcasting, Viacom and NBC.
Speaking July 21 on the Dish Network fiscal call, Roger Lynch, CEO of Sling TV, said that when the service launched in 2015, the emphasis was on sports — specifically college basketball’s March Madness and ESPN, which parent Disney allowed for the first time to be accessed without a traditional pay-TV subscription.
While ongoing technical glitches — notably during high-profile events — undermined the service, a dearth of regular compelling programming was seen driving churn.
“That was the reason we [launched multi-stream access], we saw demand for it, we expanded the content offer quite significantly, and we have been pleased with the uptake of it so far,” Lynch said.
Dish envisions Sling TV attracting subscribers unable or unwilling to pay for premium television delivered via satellite. It’s strategy borne by the advance of OTT video and a maturing pay-TV market.
Indeed, the multichannel video programmer saw 281,000 subscribers drop service in the second quarter (ended June 30), compared with a loss of 81,000 subs in the previous-year period.
Dish ended the period with 13.6 million pay-TV subscribers, compared with 13.9 million at the end of second quarter in 2015. Dish does not disclose Sling TV subscriber data, which is included with satellite.
Net income topped $410 million on revenue of $3.8 billion, compared to $324 million and $3.8 billion revenue last year.
Lynch said he’s pleased with the migration of single-stream subs to multi-stream — a move he envisions continuing as third-party competitors such as AT&T’s “DirecTV Now” enter the OTT market later this year.
“I've been a little surprised that it's taken this long for anyone to really launch,” said the CEO. “My expectation is that as new entrants enter this market, we're just going to see faster growth of OTT.”
Lynch doesn’t expect DirecTV Now or other OTT services to materially impact Sling’s growth going forward — maybe just current market share.
“I think we'll always see some of that seasonality, because it's the nature of this business. I do think over time, as our content offer gets a little broader, it probably helps smooth that out somewhat.”