DISH Network Broadens Reach with OTT Delivery
Colin Dixon, Senior Partner, Advisory
January 12, 2010
Late last year BSkyB – the dominant PayTV operator in the U.K. – announced that the company would make its satellite PayTV service available on the open Internet to any U.K. resident with a broadband connection. Now, all a customer needs to do is go to the Sky website, pick a package, provide a credit card number, and they instantly have PayTV service from Sky. This revolutionary approach allows Sky to reach customers that are unable to get the service because of satellite dish restrictions. In effect, Sky has increased the number of “homes passed” (the number of households covered by the service signal) to virtually every U.K. resident.
If judged by recent announcements, it now appears that DISH Network is taking steps down the same path as Sky; pushing the boundaries of the PayTV service across any and all physical networks to reach consumers wherever they may roam.
First, DISH announced it is working with Neulion, an Internet TV service provider, to bring its extensive catalog of international programming to U.S. residents with a broadband connection. Importantly, customers do not need to subscribe to the DISH satellite TV in order to use the new online TV service.1 They simply go to the DISH website, select a foreign-language channel pack, and subscribe to the service. Neulion then ships a DISH-branded Internet set-top box and takes care of billing and customer support.
Because a DISH satellite TV subscription is not required, potential customers do not need to change from their existing PayTV service to get the International channels. For example, a Comcast subscriber can augment their service with DISH-network Latin-American content.
Second, DISH announced the full integration of Slingbox place-shifting software into its DVR product line (dubbed the “TV Everywhere” suite). The much-delayed ViP922 DVR (announced at last year’s CES) incorporates Sling functionality into a top-of-the-line high-definition (HD) DVR. Alas, the box has yet to be released to DISH customers (as the author is painfully aware). Sling functionality can also be added to existing DISH DVRs by connecting a small side-car box via USB. Equipped with either the ViP922 or the Sling side-car, DISH customers can enjoy their TV subscription and DVR content through any broadband connection – be it stationary or mobile, at home or remote, wireless or wired.
The integration of Sling-like functionality into DVRs was first forecast by TDG two years ago in our report on place-shifting solutions. Though it took a couple years to happen, today’s consumer is no doubt better prepared to put such technology to work. Deep penetration of broadband service, widespread availability of wireless home networks, and increased awareness and use of 3G/4G networks make adoption of media place-shifting solutions much more likely.
DISH believes that enhancing the “portability” of PayTV services will exploit growing consumer demand for expanded control over how, when, and where they engage their PayTV services. According to TDG’s research, this belief is well grounded.
Another key benefit of taking a “Sling approach” to distributing TV content online is that DISH avoids the protracted and painful negotiations necessary to get content providers to bring customer subscriptions online. Instead of being restricted to on-demand versions of a few shows from a few networks (as in the case of Comcast’s Fancast Xfinity service), DISH customers will have instant online access to all their TV programs and DVR content.
Clearly, DISH has recognized that the Internet is its best friend in combating competition and winning back the hearts and eyes of a restless subscriber base. As with all such innovations, however, the devil is in the interface. Can DISH deliver the “TV Everywhere” experience in an UI that subscribers can actually use? Unfortunately, the company’s track record regarding UIs has not been good. Try finding and using the on-demand Internet movie service that is currently integrated into all DISH DVRs. That being said, the services employing Neulion and Sling functionality are clearly on the right track.
1 According to Chris Wagner, Neulion Head of Marketing in an interview conducted January 7, 2010 during CES 2010.