Dish Network said scheduling disputes, increased competition and economic turmoil caused by the coronavirus pandemic were partly to blame for a significant drop in customer numbers for its satellite and streaming television services.
In its quarterly earnings report released on Friday, Dish Network said about 462,000 customers left in the three months ending March 31.
“We just didn’t perform to our expectations,” said Erik Carlson, CEO of Dish Network, said during a conference call with investors.
Overall, Dish Network ended the quarter with just over 10.2 million pay-TV customers. Of these, the majority – just under 8 million customers – subscribe to Dish Network’s satellite service, while around 2.25 million pay for its Sling TV streaming service.
Carlson said a trade dispute with local broadcaster TEGNA caused some subscriber churn during the quarter. Dozens of TEGNA-owned local broadcast stations were pulled from Dish Network and Sling TV last October after the two parties failed to reach a new distribution deal.
Among the affected stations were the local CBS, NBC and Fox affiliates that broadcast National Football League games. About three million Dish Network customers — roughly half of its satellite subscriber base — were forced to find another method of watching games and other programming on those stations until both sides reach an agreement in January.
The end of the football season marked the end of some Sling TV subscriptions, Dish Network said, with the company seeing more customer churn than activations immediately after the Super Bowl.
“We had a difficult quarter, but we are confident that we can leverage the platform, our high-value messaging and products, and a great experience to reach customers whose overall video bills are too high. , but still want the excitement of live TV,” Carlson said.
Sling TV was one of the first streaming services to offer live cable channels over the Internet and without a separate cable or satellite subscription. The service launched in February 2015 with channels scheduled by The Walt Disney Company (ESPN, Disney Channel, Freeform), WarnerMedia (CNN, TBS, TNT; now Warner Bros. Discovery) and Scripps Interactive (Food Network, HGTV; now Warner Bros. Discovery).
Since its launch, the service has rapidly expanded to offer more channels from other content partners, including AMC Network, A+E Networks, Fox Corporation, Comcast and Viacom (now Paramount Global).
Sling TV launched with a starting price of $20 per month, appealing to consumers at a time when some households were beginning to ditch expensive cable and satellite plans for cheaper streaming options.
Over the years, several other companies have launched their own pay-TV streaming services, replicating what Sling TV brought to the table in 2015, but with more channels and features. DirecTV (DirecTV Now), Google (YouTube TV), Philo, Vidgo, Frndly TV and Fubo TV are just a few of the many options available in the market for customers who want to access live TV without cable.
As companies bolster their content offerings, Dish Network has gone in the opposite direction, focusing on value and experience. Sling TV managed to keep its base price at $35 per month by moving niche channels into add-on packages and opting out of some regional sports networks.
The end result is good service at good value, but where customers are ultimately expected to compromise – it costs more than the non-sport Philo ($20 per month), but offers more channels, but it doesn’t have the robust lineup of sports networks that Hulu with Live TV ($70 per month), YouTube TV ($65 per month), or DirecTV Stream ($70 per month) offers customers.
In the last quarter, customers felt there were too many trade-offs.