Dish’s Sling TV launches $20, live, over-the-top service

ESPN in Dish's new web TV service
ESPN in Dish's new web TV service   

Dish is shaking up the TV landscape with a new over-the-top offering—featuring live TV, and the most valuable "live" programming, sports with ESPN, and news, with CNN.

Dish's Sling TV bundle of 11 channels is $20 a month—half Dish's expected price when the service was in the works, and dramatically less than the $60 plus cable and satellite TV bundles cost. The service will allow consumers to download an app to watch live TV on Internet-connected devices, such as smartphones, tablets, computers and game consoles, as well as TV sets.

In addition to live programming, the service will also include video-on-demand programming, as well as content from Maker Studios, the YouTube content producer that Disney purchased last year. And in a departure from the way TV bundles are typically sold—with a cable box or satellite TV antenna, and some sort of commitment—this service requires no hardware and no commitment. It doesn't entirely cut the likes of Comcast out of the equation, as users still need to pay for Internet service.

There's no question that ESPN is the crown jewel of this new service. Disney's sports network is the most expensive part of the cable bundle, and live sports are considered key to keeping people locked into the TV bundle. (Market research firm Parks Associates reports that 20 percent of U.S. broadband households say sports are an important reason why they subscribe to pay TV, and 16 percent say they watch video primarily to keep up with news and current events.)

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Here's how it'll work. For $20 per month consumers get a "Best of Live TV" core package, which includes 12 sports lifestyle, family and news networks—ESPN, ESPN2, TNT, TBS, Food Network, HGTV, Travel Channel, Adult Swim, Cartoon Network, Disney Channel, ABC Family and CNN. Subscribers also get on-demand video options. For another $5 per month consumers can add extra programming. A "Kids Extra" add-on includes Disney Junior, Disney XD, Boomerang, Baby TV and Duck TV. Another add-on, focused on news, includes HLN, Cooking Channel, DIY and Bloomberg TV. The company says a sports-focused add-on is coming soon, with more content expected to roll out throughout the year.

What's missing? Broadcast channels, plus the popular cable channels that people expect to get with any cable or satellite TV bundle, from AMC to Bravo to Discovery. The premium cable channels are missing as well—though HBO and Showtime will be available a la carte this year as they launch their own streaming over-the-top services. Sling TV also doesn't include DVR—you can't record shows. But instead the app provides access to the past three-to-seven days of each channel's shows, to allow consumers to catch up, if not to binge. And unlike a regular TV subscription service, which covers your whole house, this is limited to a single video stream per account—which means no password sharing.

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This limits the potential for it to really replace a family's TV bundle, especially because it won't be easy to load on just any TV. Sling TV will be available via an iOS or Android app, or online on Macs and PCs. Plus, the app will be available via Amazon's Fire TV and Fire TV stick, Roku players and Roku TV, plus certain LG and Samsung Smart TVs, and Xbox One. Notably absent: Apple TV, though users can use iPhones or IPads to stream to their sets.

This is just the latest in the slew of new over-the-top content options outside the traditional cable/satellite TV bundle—with CBS launching a streaming app late last year, and HBO and Showtime working on apps to launch this year. Dish and its content partners, like HBO, are looking to target the 10 million broadband-only households in the U.S. The big question is whether it'll be truly incremental, appealing to the millennials who currently don't subscribe to any bundle, or whether it'll cannibalize the core subscription revenue streams for the media giants who are participating—Disney, Scripps, Time Warner. We can be sure that if it starts to eat into their revenue from Dish or the other pay TV providers' bundles, they'll reconsider their participation, or how much they're charging.

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Disclosure: Comcast is the owner of NBCUniversal, the parent company of CNBC and