It's not going to be big enough to worry about.
That was the essential message put forth by Time Warner Inc. Chairman and CEO Jeff Bewkes Thursday, while talking about Dish Network's (NASDAQ: DISH) new over-the-top venture at the Sanford Bernstein Strategic Decisions conference in New York--a speaking engagement covered by Deadline and Multichannel News.
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Bewkes |
"They limited the volume that would go through this over-the-top thing to 2 million subs with one distributor, 5 million overall," said Bewkes, noting that Dish's OTT service is targeted to young, single consumers. "That's a constructive way to make an offering to a given part of the market that does not undermine the other part of the market, which is the 90 percent of households with a number of people in them that want five TVs, TV plus Internet, etc. It seems like it's a promising experiment in market segmentation."
Dish set a summer launch date for its new OTT service shortly after announcing its sweeping, landmark carriage agreement with The Walt Disney Company, in which the satellite TV service provider secured ample digital streaming rights. It's been reported that the new digital service will launch with 20-30 channels and cost around $30 per month.
But details about the service had been rather sketchy, at least until Thursday, when Bewkes at least gave some sense of its limited scope and ambition.
Bewkes said that he believes that many members of the Millennial-aged subscriber base targeted by Dish's new service will eventually become pay-TV subscribers.
"Once they take the mattress and get it off the floor, that's when they subscribe to TV," he said.
Bewkes also addressed the issue of consolidation in the pay TV industry.
"In some ways it could help because they'll be more effective distributors," he noted. "It's a question of what happens to innovation and technical advances. Is it used to stifle competing products?
For more:
- read this Deadline story
- read this Multichannel News story
Related links:
Analysts: Watch out for Dish's OTT ambitions, but business model is unclear
Ice dam breaks: AOL, Amazon, Dish, AT&T, TWC spill into online video
Dish Network adds Netflix to subscriber bonus package
Dish looking to offer OTT service