Analyst: ‘If Sling wasn’t owned by Dish, it’d be out of business’

Sling TV
Image: Sling TV

While other analysts suggest that Dish Network and its fast-eroding core satellite TV business would be in far worse shape if not for the growth of Sling TV, Streaming Media chief Dan Rayburn is far more bearish about the virtual MVPD service. 

In an interview with FierceOnlineVideo, Rayburn said Dish isn’t doing enough to solve Sling TV’s chronic technical problems, and it doesn’t have as many subscribers as other analysts think it does. 

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“If Sling wasn’t owned by Dish, it would already be out of business,” he said. “It’s not profitable.”

Rayburn believes Sling TV has amassed only around 600,000 to 700,000 subs. Other analysts peg the number close to 1 million customers. Deutsche Bank’s Bryan Kraft, for example, estimates the number to be at around 936,000.

Rayburn noted that CBS Corp. and HBO have each announced that their respective SVOD services have eclipsed the 1 million subscriber mark. Dish still isn’t disclosing customer numbers for Sling TV.

“If their number was a million or two million, they’d be out there talking about their numbers,” he said. 

Rayburn’s ire was drawn when FOV asked him about falling content delivery network (CDN) prices, which were touted by Dish Chairman and CEO Charlie Ergen last week during Dish’s third-quarter earnings call. 

Indeed, CDN pricing has dropped to a fraction of what it was five years ago. An hour of video delivered at Sling TV’s scale, at 3 Mbps, would cost 4 cents to deliver, Rayburn said. Now, CDN costs are around half a penny. 

“It’s not immaterial, but it is not a cost that we worry about because the costs have continued to come down so significantly,” Ergen noted.

If those costs are really in control, Rayburn wondered, why isn’t Dish doing more to fix its ongoing streaming issues? Indeed, 21 months after launching, customers still complain about buffering and an overall ragged viewing experience.

“Sling’s vendors talk to me off the record, and they make it clear that Sling TV has some very interesting concepts on how streaming should work,” Rayburn said. “And those concepts don’t work very well.

“There are people like Twitch that are pumping out a lot more traffic than Sling TV who are getting it right,” he added. “Live streaming is complex, but it’s not hard. The NFL does it. Major League Baseball does it. And nobody was complaining about the streaming of the Olympics.”