Time Warner Inc. chairman and CEO Jeff Bewkes said he was “supportive” of Dish Networks’ planned over-the-top video offering, adding that limits imposed on the service by the satellite giant have alleviated any fears he may have had that it would disrupt the current distribution model.
Bewkes said the Dish service is targeted at young single people who live alone and will only allow them to access one video stream on one device.
“They limited the volume that would go through this over-the-top thing to 2 million subs with one distributor, 5 million overall,” Bewkes said at the Sanford Bernstein Strategic Decisions conference in New York, apologizing if his figures were wrong. “That’s a constructive way to make an offering to a given part of the market that does not undermine the other part of the market, which is the 90% of households with a number of people in them that want five TVs, TV plus Internet, etc. It seems like it’s a promising experiment in market segmentation.”
Dish Network spokesman Bob Toevs declined to comment on Bewkes’ remarks.
Dish has said it hopes to launch an OTT service targeted at young viewers by the summer. While the company was scarce on details for the service – which sprung in part from digital rights the satellite giant procured from The Walt Disney Co. through its landmark carriage deal earlier this year – it is expected to cost about $30 per month for between 20 and 30 channels. Dish chairman Charlie Ergen said on a conference call with analysts to discuss its first quarter results earlier this month that he has already secured rights for enough channels to create the type of service he has in mind.
The Dish offering is just one of a handful that seem to be in the works . Verizon Communications is expected to launch its own OTT video service – after buying Intel’s OnCue earlier this year – and Sony has also expressed plans for its own broadband-delivered OTT offering that would include live TV, on demand content and DVR capability.
The Time Warner chief didn’t seem nervous that the Dish OTT service would undermine the current distribution model, adding that he expects when Millennials get older, they will return to pay TV.
“Once they take the mattress and get it off the floor, that’s when they subscribe to TV,” Bewkes said.