Dish Network, the smaller of the nation’s two satellite broadcasters, saw profit and revenue rise last quarter but lost 111,000 subscribers, citing intense competition — including heavy discounting by rivals — a weak housing market and lower discretionary spending by consumers.
The Englewood, Colo.-based company, which had nearly 14 million subs as of Sept. 30, said profit rose 30% to $319 million on lower costs from adding fewer subscribers. Revenue was up 12% to $13.6 million.
“As the pay TV industry matures, we and our competitors increasingly must seek to attract a greater proportion of new subscribers from each other’s existing subscriber bases rather than from first-time purchasers of pay TV services,” the company said. “Some of our competitors have been especially aggressive by offering discounted programming and services for both new and existing subscribers. In addition, programming offered over the Internet has become more prevalent as the speed and quality of broadband networks have improved.”
CEO Joe Clayton said that going forward Dish plans to build on the momentum of its Blockbuster-branded programming service, which allows its customers to stream movies and TV shows and receive DVDs by mail.
The quarter was the first one to fully incorporate Blockbuster, which Dish acquired out of bankruptcy for about $240 million. At the end of the three-month period, Blockbuster still operated over 1,500 retail stores in the U.S. Dish said it has negotiated flexible termination provisions in the leases of more than 900 of these stores.
Larger rival DirecTV last week said it added 327,000 subscribers in the third quarter, due in part to its exclusive NFL Sunday Ticket.