The seemingly unkillable cable TV bundle is still around, despite the rapid growth of cord cutters who think it’s a big waste of time and money. But, slowly, innovations at the edges of the TV ecosystem are dreaming up new — usually cheaper — ways of repackaging video programming. Eventually, the slow tide of defectors could turn into a big wave.
On Thursday, Dish Network’s (DISH) Sling TV unveiled its latest efforts to woo customers fleeing cable. What started as the satellite system’s Internet-delivered cable channel delivery package in 2015 is morphing rapidly into something more. The updates add on-demand, pay-per-view movies and sports shows, and a bunch of new channels that customers can buy one at a time. None of the content requires a monthly subscription and there’s even some programming available for free as a teaser. The bad news is that the price of Sling TV’s 30-ish package of standard cable channels is going up $5 to $25 a month.
SlingTV president Warren Schlichting put it succinctly: “The new Sling evolves the experience even further by providing access to great content without anchoring customers to a base subscription.”
The new options follow rumors of similar featurescoming on Roku and the introduction last week of AT&T’s cheaper, no-sports cable channel bundle dubbed WatchTV, that will cost $15 a month or be thrown in free with some of the company’s unlimited wireless plans. And on Wednesday, T-Mobile CEO John Legere was testifying before Congress about his company’s proposed acquisition of Sprint and touting a strategy of going after cable with 5G wireless service.
So far, Sling TV and its Internet cable repackaged brethren have made only a small dent in the pay TV universe. Sling will have nearly 3 million subscribers by the end of the year, AT&T’s (T) DirecTV Now will hit 2.4 million, and a cadre of smaller offerings — including Google’s (GOOGL) YouTube TV, Sony’s Playstation Vue, and Hulu TV — will total about 4 million subscribers, analyst John Hodulik at UBS forecast last week. That pales in comparison to the roughly 100 million households that subscribe to traditional cable and satellite TV or Netflix’s (NFLX) 55 million U.S. subscribers. And, of course, some viewers aren’t much interested in traditional TV shows and movies, preferring shorter fare on YouTube or much longer marathon video gaming sessions on Amazon’s (AMZN) Twitch network.
The main issue for most cord cutters is price. The average cable TV bundle costs $105 dollars a month and has risen 74% since 2000, after adjusting for inflation. But even the new Sling offering, with its a la carte channel selection, shows dumping the cable bundle can get costly to get access to a wide range of channels. CBS’s (CBS) Showtime is $10 per month, Outside TV is $5 and an NBA League Pass is $29.
Pricing for pay-per-view movies will vary from $3 to $11 and will include more than 5,000 titles from top studios, including Disney, LionsGate, Sony, and Universal, Sling TV said. The free TV programming will include advertising.