Q. I read that DIRECTV Now is adding a lot more subscribers than Sling TV. Why is that? Is it a better service? — Fran, Atlanta.
Fran, Dish, which owns Sling TV, this week said the live streaming service added a net of 44,000 subscribers in the second quarter.
But AT&T, which owns DIRECTV Now, Sling’s chief live streaming rival, says it added a net of 342,000 subscribers in the second quarter. That’s the second straight quarter that DIRECTV Now has walloped Sling in the category of subscriber growth.
In fact, the AT&T service is doing so much better in adding subscribers now that industry analyst Craig Moffett predicts that DIRECTV Now will pass Sling in total subscribers by year’s end, according to a Multichannel News article. (Sling had 2.4 million at the end of the second quarter while DIRECTV Now had 1.81 million. If Moffett is correct, that would mean that DIRECTV Now would add 600,000 more subs than Sling in the second half of the year.)
Those numbers might seem to indicate that consumers are now choosing DIRECTV Now over Sling because it’s offering a better live streaming service. But before you jump to that conclusion, remember this:
During the first two quarters of 2018, DIRECTV Now was running a special promotion that would reduce its base $35 a month plan to $10 a month for the first three months. (DIRECTV Now last month raised the base price to $40 a month, but it’s still offering that plan for $10 a month for the first three months.)
That’s $15 a month cheaper than Sling’s current base price of $25 a month. (Sling last month also raised its base price from $20 a month to $25.)
I have no doubt that DIRECTV Now’s promotion was a major reason for the better subscriber numbers in the first two quarters. Sling’s $20 plan helped drive its subscriber effort since its launch in 2015 so a plan that $10 cheaper (now $15) is bound to do even better.
When you take into account that DIRECTV Now’s $10 plan offers more channels than Sling’s $25 package, it becomes even more obvious that the lower price was the chief reason for its success. Consumers love to comparison-shop.
It will be interesting to see if DIRECTV Now can keep its $10 subscribers from defecting when their three-month promotions expire. But for now, it’s working, as evidenced by the first and second quarter numbers.
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— Phillip Swann