Dish Network’s Way Forward Still Not Clear

(Satellite Business News) — On the heels of AT&T reporting poor second quarter results for its DirecTV DBS and DirecTV Now online video services, Dish Network last week announced weaker numbers for its satellite TV and online offerings.

It is not exactly a secret that Dish Network has all but given up on its DBS service, choosing instead to concentrate on Sling TV while trying to squeeze out every last penny of profit from the satellite TV business.

But the company’s income was way down in the second quarter, even taking into account the $280 million fine in the telemarketing case the company booked in the quarter. And all other key financial indicators declined in the quarter, except for slightly better churn.

Perhaps even more importantly, if the Wall Street analysts who estimate Sling TV’s net sub number each quarter were even close to being in the ballpark, the on-line service’s growth spurt is winding down or may have ended.

In addition to that probably meaning Dish Network will not change its policy of obscuring the two services’ individual net sub adds for the foreseeable future, that simply cannot be good news for the company.

Whether Sling TV’s rough quarter was due to factors associated with that service alone or to the broader trends in the marketplace remains an open question.

Since Sling TV launched a couple of years ago, the online video business has seen a bewildering number of new entrants — and more are on the way. The market just cannot sustain net sub adds for all of them.

Moreover, Dish Network has been unable to improve its historically lame advertising and marketing operations. Those two developments by themselves could be behind the Sling TV sales slump, and neither is likely to change anytime soon.

Several things are clear: First, regardless of Dish Network’s focus — and some might say obsession with — Sling TV, the service’s “first out of the gate” advantage in the on-line video businesses might have run its course.

Second, it will be three years at best before Dish Network can roll-out a meaningful, national wireless service of some kind — and that assumes it will.

Third, taken together, the first two points mean the challenges facing Dish Network will only increase in the near term — apparently far faster than its subscriber base.

Bob Scherman is the editor and publisher of Satellite Business News, an independent trade publication. Scherman has covered the satellite TV, cable, and related businesses for almost 35 years. Comments on this column can be sent to [email protected].