Dish un­veils hand­ful of new gad­gets at show

The Denver Post - - BUSINESS - By Ta­mara Chuang

An ul­tra-high-def­i­ni­tion video recorder and a palm-sized de­vice that stores 100 hours of TV shows dom­i­nated Dish Net­work’s new prod­ucts Tues­day, as the rest of Las Vegas pre­pared for the start of the 2016 Con­sumer Elec­tron­ics Show on Wed­nes­day.

It was a clear sign that the Dou­glas County com­pany isn’t giv­ing up on satel­lite TV. But will new hard­ware be enough to re­verse Dish’s shrink­ing au­di­ence? Even the show’s or­ga­nizer — the Con­sumer Tech­nol­ogy As­so­ci­a­tion — dropped elec­tron­ics from its name to re­flect that it’s not just about hard­ware any­more.

“We felt that elec­tron­ics didn’t be­gin to cover who our mem­bers are. We have Airbnb and Pan­dora. Our vice chair­man is from Boingo Wire­less,” CTA’s CEO Gary Shapiro said. “We wanted to re­flect the big­ger pic­ture.”

That pic­ture has Dish fo­cus­ing on its non-hard­ware prod­uct, Sling TV, which de­buted last year at CES. Sling of­fers live TV on­line for $20 a month. On Tues­day, it added ESPN 3 to the core lineup, plus a new look to make it eas­ier to use. In Septem­ber, an­a­lysts es­ti­mated Sling had nearly 400,000 pay­ing sub­scribers.

Many pay-TV providers are pur­su­ing their own version of Sling and pay­ing less at­ten­tion to hard­ware. They’re en­cour­ag­ing peo­ple to bring their own sub-$100 de­vice, like a Roku. Sam­sung on Tues­day said that

Time Warner Ca­ble, which is test­ing re­plac­ing the ca­ble box with Roku, will em­bed its TV ser­vice into Sam­sung TVs.

Dish and Com­cast are the most se­ri­ous about us­ing their own hard­ware to at­tract cus­tomers, said Alan Wolk, se­nior an­a­lyst with the Dif­fu­sion Group, a mar­ket re­search firm.

Cool hard­ware is some­thing Dish must of­fer be­cause it doesn’t have the lux­ury of sub­si­diz­ing TV rev­enues with broad­band, as Com­cast does, Wolk said. (Dish, how­ever, has ac­quired sig­nif­i­cant wire­less spec­trum, which could one day be used to of­fer wire­less In­ter­net.)

“If (Dish) wants cus­tomers to stick with them while ca­ble broad­band providers are offering triple plays, it can’t just be on price,” Wolk said. “They’ve got to give con­sumers an­other rea­son to stay.”

Adding Sling was a move by Dish to wean it­self from price-con­scious cus­tomers. Char­lie Er­gen, Dish’s CEO, said the com­pany is less con­cerned about keep­ing those cus­tomers. As a pos­si­ble re­sult, Dish lost 23,000 cus­tomers in the third quar­ter last year. The av­er­age sub­scriber who stuck around, how­ever, paid $2 more per month.

Tra­di­tional pay-TV ser­vices are not giv­ing up yet.

“De­clines in wired video ser­vice are definitely not some­thing that tra­di­tional providers are ig­nor­ing,” said Glenn Hower, a re­search an­a­lyst with re­searcher Parks As­so­ciates.

He pointed to the new stream­ing TV ser­vices, such as Sling and Com­cast’s Stream TV. And DirecTV, which was ac­quired by AT&T in July, he said, has “fiercely held onto the rights for the NFL Sun­day Ticket, which is a huge seller for them.”

Com­cast in­vested heav­ily in hard­ware with its X1 box, which touts voice con­trols and on­line video stor­age. X1 can bump up a monthly bill for ser­vice by $20. Even at the higher price, cus­tomers up­graded. Nearly 25 per­cent of Com­cast’s video cus­tomers now have the X1, ac­cord­ing to the com­pany’s third quar­ter 2015 re­port.

“One of the prob­lems peo­ple have with pay TV is they’re pay­ing Nord­strom prices for a Kmart ex­pe­ri­ence. They’re pay­ing a lot of money, and most set-top box in­ter­faces and hard­ware are just aw­ful. My iPad looks beau­ti­ful. My com­puter looks great,” Wolk said. “But why does my TV look like it’s stuck in the Clin­ton ad­min­is­tra­tion? And on top of that, I’m pay­ing $140 a month for that.

“But if it had all the bells and whis­tles, they see the cor­re­la­tion and think, ‘I’m pay­ing $140 and it looks like a $140 ex­pe­ri­ence.’ If they like it bet­ter, they’ll spend a lot more money,” he said.

On Tues­day, Dish un­veiled the Hop­perGo, a tiny por­ta­ble de­vice to view recorded shows while trav­el­ing — no In­ter­net re­quired.

It also launched the new Hop­per 3, a souped-up DVR meant to quell fam­ily fights about who gets to watch or record shows. With 16 tuners, the Hop­per 3 can record 16 chan­nels si­mul­ta­ne­ously.

The new DVR, out this month for $15 a month more, also sup­ports ul­tra-high-def­i­ni­tion broad­casts to fit the newer 4K TVs, which are four times the res­o­lu­tion of an HDTV. As part of Tues­day’s news, Dish plans to add a 4K video-on-de­mand li­brary.

“I don’t think there is any ques­tion that the hard­ware sup­port­ing tele­vi­sion to­day on the pay-TV side has meant hun­dreds of thou­sands of ad­di­tional sub­scribers that would have oth­er­wise been lost to some form of cord cut­ting,” said Jimmy Scha­ef­fler, chair­man of The Carmel Group, a con­sult­ing firm.

Most stream­ing ser­vices also don’t of­fer the con­ve­nience of record­ing, like a DVR does, Scha­ef­fler pointed out. As peo­ple age, have fam­i­lies and in­creased re­spon­si­bil­i­ties, the tech­ni­cal fea­tures, like DVRs, be­come more im­por­tant.

“Once they get those re­spon­si­bil­i­ties un­der their belt, they also tend to make more money. So they’re a bet­ter de­mo­graphic,” Scha­ef­fler said. “You may be los­ing sub­scribers, but you’re los­ing sub­scribers on the low end rather than the up­per end of rev­enues. And that’s the im­por­tant con­sid­er­a­tion here. Tech­nol­ogy, es­pe­cially with things like the Hop­per, get you to that de­mo­graphic.”

Ta­mara Chuang, The Den­ver Post

Dish Net­work un­veiled the Hop­perGo at the Con­sumer Elec­tron­ics Show in Las Vegas on Tues­day.

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