DirecTV later in 2014 will launch an over-the-top video service aimed at Hispanic consumers, CEO Mike White said Friday, speaking at an investor conference.
“We are looking to launch a Hispanic product later this year,” White said at the Goldman Sachs’ Communacopia conference. “You’ll hear about it in due time.”
The Hispanic package, targeted to younger consumers, will be the first niche-focused Internet video service from DirecTV, according to White. “Our first focus is going to be a differentiated service for Hispanic later this year,” he said.
White added that DirecTV also is exploring different options for delivering NFL Sunday Ticket with the league. “We are aligned (with the NFL) to see how we can broaden that over time,” White said.
DirecTV’s Hispanic OTT service will be called YaVeo, as first reported by GigaOm. Pricing and other details of the service have yet to be revealed. Univision and DirecTV declined to comment on the reports.
Instead of trying to introduce a broadband-delivered replacement for traditional pay-TV services, DirecTV is looking at niche-content areas “more in the mode of a Netflix,” according to White. He compared the company’s focus on targeted OTT packages as akin to “specialty magazines,” citing the Chernin Group-controlled Crunchyroll, an online SVOD service specializing in anime. (Separately, AT&T and Chernin Group have teamed up to form Otter Media, pooling some $500 million to acquire, invest in and launch online-video services.)
Dish Network, Sony and Verizon Communications have each disclosed plans to deliver Internet-based TV services. Dish has deals with Disney/ESPN and A+E Networks and is targeting a year-end launch, while Sony announced a pact with Viacom this week. Verizon is shooting to launch a wireless OTT video service in mid-2015.
But White reiterated that he’s skeptical about OTT services that are aimed at replicating the pay-TV bundle. “We would all like to find a way to serve millennials,” he said. However, programming contracts prevent operators from offering a bundle in a more-affordable $15-$20 monthly range for price-sensitive consumers, he added.
In DirecTV’s core pay-TV business, content costs continue to rise. While programming costs have been “under control” this year, DirecTV anticipates double-digit increases in 2015, White said — which will force the satcaster to again raise its prices for customers.
In 2014, DirecTV has held programming costs down by in some cases refusing to carry networks, White said. That includes Time Warner Cable’s SportsNet LA, which was the home of the Dodgers. Subscriber churn that resulted from DirecTV not carrying the Dodgers network, White claimed, “wasn’t that big.”