Dish TV is adding HBO to its over-the-top Sling TV service. The premium pay TV content provider will be available for $15 a month as an add-on package.The deal comes as part of a larger carriage deal between Turner Networks covering satellite and OTT.The agreement prevents any disruption for the Turner channels similar to the month-long blackout for CNN, HLN, Carton Networks and others. HBO will become available to Sling TV in time for the new season of Game of Thrones on 12 April.
In order to receive the service a Sling TV customer must first be subscribed to the "Best of live TV" core package at $20 a month. At launch only the core HBO channel and its video-on-demand content will be available.
The move to include HBO on the fledgling OTT pay TV service Sling TV makes sense on many levels. First, it is the first longstanding premium TV service to be adopted by Sling TV. Second, carriage for Sling TV meshes well with rights negotiations for carriage on the parent Dish Network. Third, at $15 per month there is little risk of cannibalisation by Sling TV subscribers of traditional Dish Network subs. Fourth, it encourages subscribers to return back to traditional pay TV. Fifth, it makes sense for Time Warner to distribute HBO as widely as possible.
Not considering Epix (which launched in 2009), HBO is the first long-standing premium TV service to get carriage on Sling TV. Different from the HBO Now stand-alone service, also offered at $15 per month, the Sling TV addition also offers the live linear feed to Sling TV subscribers. While this may not seem like a big deal on the surface, the distinction is significant. HBO offers only a subset of its content on the on-demand service compared with the linear feed and on-demand channel via Sling TV.
Dish's inclusion of Sling TV rights seems logical in that Time Warner is seeking to renew the terms for its current deal with Dish, the USA's third largest pay TV provider. And it is conceivable that in order to secure Dish's carriage at current contractual rates that Time Warner would have to cede rights for carriage to Sling TV.
At $15 per month it isn't a significant risk for Time Warner. The price point is well established for HBO, and like HBO Now doesn't encourage defection away from pay TV. At $15 per month Sling TV users get slightly more than their HBO Now counterparts - access to the live linear stream of the main HBO channel. As demonstrated in recent years, multiplex versions of premium channels are viewed as premiums to the subscription as they give more choice.
By not including multiplexes in the Sling TV offering, IHS speculates that Time Warner and Dish are effectively encouraging Sling TV subscribers to return to the pay TV fold, if they want to have access to the full HBO experience. It remains to be seen if this speculation holds true, but the question remains whether or not the real value for HBO lies with its suite of multiplex channels, or with its main channel, or with is original content.
From Time Warner's perspective it makes sense to distribute HBO as widely as possible, even if the offering is a shadow of what's available on non-OTT pay TV. The fact remains that a Sling TV subscription with HBO marks a half way point between a full non-OTT pay TV subscription and HBO Now which is on-demand only.