Dish Network Corp. although posted a better profit margin for the first quarter of 2015, but lost many pay-TV subscribers due to expiry of programming contracts. According to company, non-validation of Programming content cost it 134,000 pay-TV subscribers, hurting the firm very much indeed.
Dish executives blamed negative pay-TV industry for slumped subscribers’ growth as weak economy pushed the company to limit its expenses compared to its competitors and heavy promotions from rivals also hurt the firm badly.
The firm’s Profit margin almost doubled in the first quarter compared to the prior-year quarter. The satellite-streaming service provider gained a total profit of $351.5 million, or 76 cents a share, up from $175.9 million, or 38 cents a share gained in the year earlier period. Non operating income contributed $120 million to profit. The pay television provider reported a boost in revenue growth with turnover stood at $3.72 billion but revenue grew marginally less than the analysts’ estimates of $3.74 billion or 40 cents a share in revenue.
Dish Network considerably controlled the losses resulting from loss of subscribers by introducing a new video-streaming service known as Sling TV in the U.S during in early 2015. After a hard work of three years in an attempt to introduce cheap streaming TV service for enticing young audience, the company has finally done its homework. The service includes reduced set of channels on separation basis.
Dish Network Corp was hurt by subscribers, as its subscribers declined from 14.1 million year on year to 13.8 million subscribers in the first quarter of 2015. The firm added 554,000 in Gross pay-TV accounts, far below than 639,000 added in the last year period. The company overall lost 134,000 subscribers contrasting to an addition of total 40,000 subscribers a year earlier in a year earlier period.
Dish accused programming disruptions for such havoc declines in subscribers’ strength.
Another big factor which plays an important to any broadcasting firm is churn rate, rate at which people terminated service. Pay-TV subscriber churn rate was up 1.65% compared to 1.42% a year earlier. The causes like advertising and competition among rivals to dominate other by offering discounted packages along with credit quality of subscribers causing the churn rate to climb the steps of heights, according to firm.
Dish average revenue per subscriber bolstered $86.01, up from $82.36 in a year earlier period, aided by increase in prices.
But company’s satellite-broadband customer department didn’t post a better growth. As firm recorded 14,000 net subscriber growth compared to 53,000 subscribers added in the first quarter of 2014.
