NEW YORK—Sling TV has been in the virtual MVPD business longer than most, and the service believes it sets itself apart from its competitors by not acting like traditional pay TV.
Jimshade Chaudhari, vice president of product marketing and management for Sling TV, said the majority of Sling TV’s customers are cord-cutters coming from traditional pay TV. But he said the value proposition for Sling TV is relevant for cord-cutters and cord-nevers.
“We fundamentally believe we have a different model than our competitors,” Chaudhari said.
In the U.S., Sling TV’s two base packages—Orange and Blue—are both priced at $25, significantly less than the standard $40 to $45 per month many other vMVPDs charge. From there, Sling allows subscribers to build up their channel bundles through $5 add-on packages that focus on sports, news, kids programming, comedy and other categories, while also offering premium channel add-ons like HBO and Showtime.
Speaking at the Streaming Summit at NAB New York with conference chair Dan Rayburn, Chaudhari said that the larger channel bundles available from competitors like DirecTV Now, Hulu with Live TV and YouTube TV are “repeating the sins of pay TV past” by packaging up a lot of channels, not all of which consumers want.
Chaudhari also said that since Sling TV has been in the vMVPD industry since the beginning, it has the technology around live video delivery down at this point.
“We’re past the early adopters and into the early majority. When we came out we had to work with a lot of partners to optimize for live video delivery,” Chaudhari said. “I think we’ve nailed it as this point.”
At this point, he said, live viewing is what draws people to Sling TV, but the service now has more than 80,000 assets of on-demand content. He said the longer customers stay on the platform watching live, the more on-demand they end up watching as well.
Despite the mix of live versus on-demand, vMVPDs like Sling TV are still subject to programming costs (along with many other costs associated with video distribution) that can put pressure on margins. Rayburn said that one major vMVPD told him that its complete channel list adds up to about $42 per subscriber in programming costs, meaning that at current price points, vMVPDs are not a sustainable business model. At least, not without the support of associated media conglomerates like AT&T with DirecTV Now and Google with YouTube TV.
Sling TV has similar backing from Dish Network and the company’s still profitable satellite TV business. But Chaudhari said Sling TV can eventually stand on its own as a viable business.
“I think it can be a profitable business and we’re focused on that,” Chaudhari said.