DISH Exec: Sling Freestream to Keep Customers Engaged Even If They Churn; Cable TV Is the Next Newspapers
There’s never a bad time to enter the free, ad-supported streaming business. A report from November showed that 37 million American TV watchers use ad-supported streaming in one form or another, and as economic uncertainties and inflation continue to plague consumers, that number will likely rise.
The live TV streaming service Sling TV is one of the latest entrants into the free streaming game. Sling and its parent company DISH launched Sling Freestream — a new free ad-supported streaming TV (FAST) platform — early in February, and DISH executives were asked about the service in the company’s fourth-quarter earnings call with analysts on Thursday.
DISH CEO W. Erik Carlson said that because of the seasonal nature of live streaming, having a free streaming service was crucial to enhancing Sling’s “stickiness,” an industry term that means its ability to keep users rather than watching them churn away when their chosen programming is over.
“As you know, OTT (over-the-top) is a bit seasonal,” Carlson said. “It’s not much different from regional sports really. And so folks can come in and out very easy. And Freestream is great for us to launch, because it keeps folks kind of in our Sling ecosystem, right?”
Expounding on his comparison between live TV streaming and regional sports, Carlson discussed the cyclical nature of the businesses being built on established seasons of programming and from sports leagues. Oftentimes, customers will unsubscribe when their favorite shows or sports have ended for the year, only to return when it picks back up. For Sling, having the Freestream service available to keep them engaged with the platform — even if they do unsubscribe from the live TV streaming option — allows the company to continue to monetize its users and hopefully retain them when it is time for them to sign up again.
“Unfortunately, it’s just gotten hard to watch TV,” he continued. “And so Freestream helps to have customers without our Sling ecosystem that may want to pay for college football over the course of four months and then pick up some general entertainment on a FAST channel and come back for basketball. And so it’s very easy for us. And it was just — it makes sense for our Sling customers to have kind of a fast offering, along with our direct-to-consumer offerings, where you can buy an AMC or discovery+.”
It’s a wise move on Sling’s part to begin offering a free streaming service now. Nearly 70% of streaming users in the United States report that they’re considering cycling to a new service once they’re done watching the content they subscribed for, according to one survey, and streaming providers must do whatever they can to keep users engaged.
The executives also used the opportunity to discuss the position of linear cable providers in 2023. DISH co-founder Charles Ergen likened cablers to newspapers, and stated bluntly that most customers are getting their TV from sources other than linear providers these days, similarly to how consumers moved away from newspapers a generation ago.
“[Pay-TV providers are] the newspaper of the of this decade, which is you raise your price for newspapers and there’s a few people continue to read the newspaper,” Ergen said. “I’m one of them. But the fact of the matter is that I don’t read the newspaper, I get my news elsewhere now. And if I lost my newspaper tomorrow, I’m probably okay.”
With a reported 52% of U.S. households having cut the cord, it’s hard to argue Ergen’s position. Even virtual pay-TV providers are feeling the pinch, with Sling itself having lost 77,000 subscribers in the fourth quarter of 2022. The company is hopeful that the addition of Sling Freestream will help ease cycling, and possibly lure some users back into the fold.
Sling TV
Sling TV is a live TV streaming service that helps users save money with the option of two distinct plans. The $40/month “Sling Orange” plan offers about 30 channels, including Disney Channel and ESPN. The $40/month “Sling Blue” plan offers about 40 channels, including Fox and NBC local channels.