By Shalini Ramachandran
LAS VEGAS-- Dish Network Corp. introduced its new online video
service Monday, culminating a three-year effort to create an
inexpensive streaming TV service to reach a younger generation of
viewers.
The satellite TV provider said the service, dubbed Sling TV,
will launch later this month at $20 a month. Roger Lynch, Dish's
executive vice president of advanced technologies, was named chief
executive of Sling TV LLC.
At launch, Dish said the new service will carry channels of both
live and on-demand content from partners that include ESPN from
Walt Disney Co., TNT from Time Warner Inc., and Food Network from
Scripps Networks Interactive Inc.
The inclusion of ESPN could be especially significant, marking
one of the cheapest ways that "cord-cutters," who shun conventional
TV services, can tap into the channel's trove of live sports
programming. ESPN is a key selling point for cable and satellite TV
providers, and the most expensive cable channel to carry.
Dish's service also will offer Web videos from Maker Studios,
one of the biggest producers of programming on YouTube.
Notably missing, however, are big channels like NBC, CBS,
Nickelodeon, Fox and Discovery, from Comcast Corp.'s NBCUniversal,
CBS Corp., Viacom Inc., 21st Century Fox and Discovery
Communications Inc.
Some of those companies have been reluctant to license their
networks for the new service because Dish wants just a subset of
their popular channels, rather than the whole bundle including
lesser-watched channels. They fear that striking such a deal could
undercut the current, lucrative pay-TV model.
Another sticking point: Dish has proposed to relegate
broadcasters Fox, CBS, ABC and NBC to a separate "tier" that would
cost consumers more, a move that would flip on its head the
longtime practice of cable and satellite operators offering
broadcast networks in their lowest-cost packages.
Still, Dish's ability to reach deals with even some major TV
programmers shows a shift in thinking over the past year in the TV
industry. In November 2013, Dish Chairman Charlie Ergen said he was
"0 for 50" in talks with content company CEOs.
But that has changed over the past year. More people are
dropping their pay-TV subscriptions, while ratings declines for
many major TV networks are forcing media companies to look for new
routes to grow in a mature business.
Dish maintains that its aim is to increase revenue for all
parties involved, rather than chip away at the existing model.
Chief Executive Joe Clayton, at a news conference at CES, said the
service should expand its audience by reaching millennial consumers
rather than cannibalize its existing business.
"Why? Because we don't reach them today," Mr. Clayton said.
Dish believes it can aim its service narrowly at cord-cutters
and "cord nevers"--younger consumers who have never paid for
television. To that end, the service will only allow one stream per
subscription at any given time, to limit its appeal for families
with varying tastes among members.
Unlike traditional satellite or cable TV, Dish's new service
won't require customers to wait for technicians to visit the house
and install equipment; it'll be instantly available as an app on
popular devices that can stream video.
Customers also can cancel their subscriptions anytime, and Dish
says it won't require people to agree to contracts or subject
themselves to credit checks that are typically required when
signing up for pay TV.
The service will be available on a number of devices, including
tablets, smartphones, computers, gaming consoles and devices from
companies like Roku Inc., Microsoft Corp.--with its Xbox videogame
console--and Amazon.com Inc. that stream video to TV sets.
While the service won't have a digital video recorder, a "3-Day
Replay" feature will allow viewers to watch many of the shows that
have aired in the past three days on demand. Dish says viewers will
be able to pause, rewind and fast forward most live channels and
on-demand content. The satellite provider hinted at additional
deals to come for children's and news genre programming.
Streaming TV is a crowded field. Netflix Inc., Amazon and Hulu
already stream shows from many of the networks Dish will carry.
Sony Corp. launched an online version of pay TV late last year,
complete with a cloud-based digital video recorder. Meanwhile, TV
networks like HBO plan to release their own stand-alone streaming
services this year.
Mr. Lynch said the new service will be promoted with an ad
campaign under the slogan "Take Back TV."
Sling TV has no direct connection to Sling Media, the unit of
EchoStar Corp. resulting from a 2007 acquisition that makes the
Slingbox streaming device. EchoStar is Dish's sister company, also
controlled by Mr. Ergen.
Among other CES announcements, Dish said it would begin offering
a new set-top box that is specifically designed to carry the new
Ultra HD, or 4K, content that some of the latest televisions
support.
Write to Shalini Ramachandran at shalini.ramachandran@wsj.com
and Don Clark at don.clark@wsj.com
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