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Dish Sheds 334,000 TV Subscribers in Q4, Taking a Hit From HBO and Univision Blackouts

Dish Network lost a record 381,000 satellite TV subs in the fourth quarter of 2018, as the carriage standoffs with AT&T’s HBO and Univision accelerated the pain the company has already been feeling from cord-cutting trends.

Dish eked out a net gain of just 47,000 subs for Sling TV, its cheaper over-the-top subscription offering, in the period. The Q4 2018 overall net loss of 334,000 customers compares with Dish’s net addition of 39,000 in the year-earlier quarter.

The major factors hurting Dish’s subscriber numbers: Univision programming remains dark on Dish and Sling TV, after it was pulled from on June 30, 2018, as do HBO and Cinemax, which have been unavailable on Dish satellite and Sling TV services since Oct. 31.

Dish’s stock fell more than 7% in pre-market trading Wednesday on the Q4 subscriber loss.

“Univision’s removal of certain of its channels from our programming lineup will continue to negatively impact our Dish TV churn rate, net Dish TV subscriber losses, gross new Dish TV subscriber activations and net Sling TV subscriber additions in the short-term,” Dish said in a 10-K filing Wednesday. “However, over the long term, we anticipate that we will be able to provide more compelling offers to our subscribers, particularly containing Latino programming because of, among other things, our ability to provide more flexible and lower cost programming and because certain Univision programming is also available through alternative methods including over the air antennas and directly from Univision over the Internet.”

With regard to the loss of the HBO channels, Dish said that also boosted churn rates, subscriber losses and lower gross new Dish TV subscriber activations during the third and fourth quarter 2018 and continuing into the first quarter 2019.

“[W]e and AT&T have been unable to negotiate the terms and conditions of a new programming carriage contract” for the HBO networks, Dish said in the 10-K. ” Furthermore, AT&T offers its programming, including its HBO and Cinemax channels, directly to consumers over the Internet and provides HBO for free to subscribers of its streaming service AT&T’s ‘Watch TV.’”

Last month, Dish filed a patent-infringement lawsuit against Univision, alleging the broadcaster’s products including subscription-streaming service Univision Now, the Univision app, and Univision Deportes services violate four Dish-owned patents covering adaptive bit-rate streaming.

All told, Dish lost a net 1.125 million satellite TV customers in 2018, to stand at 9.905 million at the end of last year. It had 2.417 million Sling TV subscribers, a net gain of 205,000 for the year.

Dish topped Wall Street expectations on revenue but missed on the bottom line. The company posted revenue of $3.31 billion for Q4, compared with $3.48 billion in the year-earlier period, and diluted earnings per share of 64 cents. Analyst consensus estimates for Q4 were revenue of $3.28 billion and earnings of 67 cents per share.

For full-year 2018, Dish’s pay-TV average revenue per subscriber was $85.46, down from $86.43 in 2017, reflecting the shift to cheaper Sling TV packages. Dish’s satellite TV average monthly subscriber churn for 2018 was 1.78%, unchanged from 2017.

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