Dish loses 268K pay TV subscribers across satellite, Sling TV in Q4

Dish Network on Tuesday disclosed losing 268,000 net pay TV subscribers in the fourth quarter, with decreases across both linear satellite and virtual MVPD Sling TV.

Preliminary year-end subscriber metrics were among KPIs contained in an 8-K filed January 17 with the SEC alongside the announcement of a new $500 million secured debt offering. The Q4 pay TV results included better-than-expected drops in satellite subscribers, with Dish losing 191,000 in the quarter, compared to Wall Street expectations of losing 205,000, according to New Street Research. Sling TV saw subscriber losses of 77,000 in the period, similar to the 70,000 it lost in Q4 2021.  

Net pay TV losses compare to the 273,000 subscribers Dish shed in the fourth quarter of 2021.

As of the end of 2022 Dish’s pay TV base stands at about 9.75 million, including around 7.4 million satellite subscribers and 2.3 million Sling TV subs.

Financial impacts won’t be disclosed until Dish officially reports full fourth quarter earnings, which don’t yet have a scheduled release date.

While pay TV remains its main business, Dish is working to build a 5G network and become a fourth nationwide competitor in the wireless industry and preliminary results show its Boost Mobile MVNO business also shed subscribers (24,000) in the three month period.

According to a Tuesday report from MoffettNathanson, Dish’s satellite TV business is now declining at a rate of 9.8%, marking its worst since 2019 and ten quarters in a row of accelerating losses.

“Unfortunately, after some years of improved retention as the company focused on its stickiest rural subscribers, their subscriber loss has re-accelerated,” wrote analyst Craig Moffett.

The firm emphasized that preliminary Q4 satellite losses were slightly better than the 203,000 Dish lost in Q4 2021, noting “the general trend isn’t obviously worsening.” The problem, according to MoffettNathason, is gross additions, with Dish’s base continuing to shrink and now “only about one third the size it achieved at its peak in 2009.”

In terms of gross additions the firm said that Dish only added 149,000 subscribers in Q4 “their lowest in more than twenty years,” and considerably less than the 651,000 added a decade ago.

And the Wall Street analysts don’t foresee conditions getting easier for Dish, which unlike cable operators doesn’t have a broadband service it offers alongside pay TV. MoffettNathanson pointed to competition from accelerated fiber buildouts, Starlink’s SEO satellite service, and fixed wireless service from T-Mobile and Verizon that’s largely targeting rural markets.

“Cord-cutting for SVOD and vMVPDs wasn’t an option for rural households without adequate broadband connections. It will be soon,” wrote Moffett in a note to investors. “Dish’s retreat-to-rural strategy worked well for a time. But it leaves them increasingly vulnerable to these various rural incursions.”

Not only did the satellite pay TV business continue to shrink in Q4 but so did vMVPD Sling TV, which offers a skinnier bundle of TV channels delivered over the internet. According to Moffett, the preliminary Q4 results mean Sling TV’s base is now about the same size it was when the service was three years old in early 2018.

Dish started off 2023 in a retransmission dispute with Mission Broadcasting and White Knight Broadcasting that saw the pay TV provider remove over 30 stations across 28 markets, asserting the broadcasters demanded unreasonable programming fees.