Dish: Comcast-Time Warner Cable Merger Would Kill Sling TV

23 Feb, 2015 By: Erik Gruenwedel

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Longtime critic of Comcast’s acquisition of Time Warner Cable (TWC), Dish Network Feb. 23 said regulatory approval of the $45 billion merger between the two cable giants would likely result in the end of upstart over-the-top video streaming service Sling TV.

The $20 monthly subscription service launched Feb. 9 features ESPN, ESPN 2, Disney Channel, CNN, Maker Studios, TNT, HGTV, TBS, Adult Swim, El Rey, Travel Channel and Food Network. Epix and AMC Network access is pending.

A key component to the cable merger is the reality they could control a major share of the nation’s broadband distribution — the lifeline to OTT video, including subscription streaming services Netflix, Amazon Prime Instant Video and Hulu Plus.

That scenario, according to Dish, consolidates too much control of the nation’s broadband access.

“If you put [Comcast and TWC] together, and exercised their monopoly power over 50% of homes’ access to broadband, then Sling TV wouldn’t make it,” Stanton Dodge, EVP and general counsel at Dish, said on the satellite TV operator’s fiscal call.

Indeed, Dish founder (and pending CEO) Charlie Ergen said the fact video distribution is moving toward OTT underscores the reality that Comcast and TWC would essentially become united competitors within the OTT market due to their own video services.

Ergen characterized as “propaganda” Comcast’s attempt to diffuse the issue by declaring the merger would result only in about 35% control of the nation’s broadband in regional markets.

“They actually become national [broadband] players,” he said. “I think that’s a real risk to the competitive nature in the industry.”

Sling TV CEO Roger Lynch said a Comcast/TWC merger would control broadband distribution in 18 of the top 20 markets nationwide.

Lynch called initial Sling TV subscriber retention “promising,” but added it is still early in the service’s existence. He said Sling’s strategy continues to pursue consumers who don’t have traditional pay-TV. Indeed, early sub data is skewing toward younger males who, in the past, frequented sports bars or their parents’ homes to watch sports, according to Dish.

“We’re seeing really what we expected,” Lynch said. “It’s a little early to tell long-term what this means. But we’re encouraged by it.”

Ergen said a more complete test of OTT video’s impact on pay-TV would occur later this quarter when Sony reportedly launches PlayStation Vue, a cloud-based TV service. It promises access to myriad channels, including Discovery Communications, OWN, Fox, NBC Universal, Scripps Network and Viacom.

"I think it really will a direct replacement to cable, satellite and [telecom] video subscriptions. I think that will really be more interesting. We’re more interested in the incremental business [with Sling TV],” he said.

 

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