DirecTV CEO: We have 1M subscribers on our skinny bundle

Skinny bundles aren't a new phenomenon, certainly not to satellite provider DirecTV (NASDAQ: DTV). Speaking to investors during the company's first quarter earnings call, DirecTV CEO Mike White said that the company has more than 1 million subscribers on its Entertainment Select package, which offers about 130 channels for $19.99 per month with a 24-month contract and $49.99 per month thereafter.  The package includes premium channels HBO, Starz, Cinema and Showtime for three months.

White added that the company is happy with its current number of customers enrolled in its Entertainment Select package and that it manages those subscribers carefully.  "We feel like we have a good value for customers," he said.

The company rolled out the $19.99 package in February in reaction to the launch of Dish Network's (NASDAQ: DISH) $20-a-month OTT service.  

However, White noted that he might think about skinny bundles differently if he was also selling broadband service to his customers, something that will happen after AT&T (NYSE: T) closes on its $48.5 billion purchase of DirecTV, which is expected to occur sometime this quarter.  White noted that he believes skinny bundles make a lot more sense as part of an Internet strategy and he believes that programmers will become more flexible with their programming deals as they realize that skinny bundles are something consumers want and demand. "It's hard not to provide the customers with what they want," White said, adding that he isn't a fan of going to a complete a la carte strategy.

White also noted that DirecTV could technically offer an over-the-top service to customers by adding applications to its set-top box.  He said that the company is already doing something like that with the Pandora app.

But White remains uncertain about whether skinny bundles will be prominent in the OTT world.  He said that while there is plenty of incentive for programmers to offer their content over-the-top, they have to make sure it makes financial sense and also have to be careful that they don't cannibalize their customers. "All of us on the distributor side are looking at what customers want," he said. "If I can get the most-watched channel in my bundle over the top, maybe it doesn't need to be in the bundle any more."

For more:
- listen to this webcast
- see this DirecTV earnings article

Earnings summary: Sizing up pay-TV earnings for the first quarter of 2015

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