Dish unveils handful of new gadgets at show
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.”
Dish Network unveiled the HopperGo at the Consumer Electronics Show in Las Vegas on Tuesday.