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State of the Screens

Dish Network between a rock and hard place

By May 17, 2018No Comments

Interesting break out from Colin Dixon @ nScreenMedia on the economics of streaming vs. traditional pay TV providers.

Monthly revenue per customer:
Dish Network — $103
Sling TV — $20 (↓ 81% less)

The cost to acquire a customer:
Dish Network — $700
Sling TV — $30 (↓ 96% less)

If these numbers hold, then it would take the streaming provider 1.5 months to re-coup the customer acquisition costs versus 6.8 for traditional pay TV.

There are other tradeoffs for streaming TV providers.

Positive tradeoffs:
Less customer hardware (satellite dish, set-top-box, etc.) to manage
2) Higher margin options for advertising due to digital style targeting

Negative tradeoffs:
Higher churn due to lack of annual contracts
2) Thinner margins due to lower monthly bill

Quote from Charlie Ergen — Chairman and CEO @ Dish.
“I think it’s fair to say that advertising will be a bigger portion of revenue and margin for OTT than it is in linear TV.”

Michael Beach

Michael Beach

Michael Beach is the Chief Executive Officer of Cross Screen Media, a media analytics and software company that enables marketers to plan, activate, and measure CTV and linear TV at the local level. Michael is also the founder and editor of State of the Screens, a weekly newsletter focused on video advertising that is a must-read for thought leaders in the advertising industry. He has appeared in such publications as PBS Frontline, The Wall Street Journal, The New York Times, Axios, CNBC and Bloomberg, and on NPR’s Planet Money podcast.