Dish’s Ergen: ‘It's game on to convert a cable subscriber to an OTT subscriber’

Charlie Ergen, CEO of Dish Network
Dish CEO Charlie Ergen has suggested that Sling TV and other virtual MVPD services are evolving into linear pay-TV replacements.

The emergence of fully realized virtual pay-TV bundles through products like DirecTV and YouTube TV has shifted Sling TV’s strategy from merely targeting a few broadband users to trying to replace traditional services.

“I think strategically when we started Sling, we were not looking to replace the cable bundle,” said Charlie Ergen, chairman and CEO of Dish Network, speaking to investors and media Monday during Dish’s first-quarter earnings call, according to a Seeking Alpha transcript.

RELATED: Dish loses another 143K subscribers in Q1, company in ‘breathtakingly rapid secular decline,’ analyst says

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Ergen had suggested during Dish’s Q4 2016 earnings call in February that Sling TV and other virtual MVPD services were evolving into linear pay-TV replacements. On Monday, he was even more emphatic about it. 

“We were not looking to take a cable subscriber or for that matter a satellite subscriber and suddenly convert them into an OTT …,” Ergen added. “So that has not been our primary objective. Having said that, it appears that where Hulu and YouTube and DirecTV Now and Sony are, that they all are basically replicating the cable bundle. And so there's no question now that it's game on to convert a cable subscriber to an OTT subscriber for essentially the same services.”

RELATED: Ergen: ‘OTT is now a direct replacement for cable and satellite’

With its virtual MVPD customers offering more robust bundles, Sling TV CEO Roger Lynch said his company has responded in kind.

“One thing I've noticed is with the launch of these other OTT services, starting with DirecTV Now, they are bigger bundle packages,” Lynch said. “And we're seeing Sling customers increasingly taking more add-on packs. So it may be a different class of customers coming into the market spurred by the big bundles that have launched in OTT. But we're definitely seeing customers who are taking more add-on packs that is certainly correlated with that.”

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