The second largest satellite TV operator in the U.S., DISH Network Corp. (DISH), enriched its award winning Hopper device by allowing its users to watch TV shows while traveling.
Despite facing lawsuits from leading media channels regarding DISH’s new Auto Hop facility, which allowed customers to easily skip ads while watching recorded TV shows, the company has enhanced the new device with more music and gaming apps. Each Hopper device is integrated with Sling technology, offering smooth streaming of TV shows on PCs and Tablets anytime and anywhere. The device also features a Dish Explorer app, which allows subscribers to not only remain in touch with the latest shows and updates but also helps them to tweet while watching TV shows.
However, the most exciting feature of the product is the ability to view offline TV shows on Apple Inc.’s (AAPL) iPad. It is possible by transferring the shows from Hopper to iPad through WiFi technology, which is already integrated in every Hopper device, hence putting pressure on revenues of other TV channel players, who sell their contents on iTunes.
However, other features like the 2-terabyte hard disk capable of storing 2,000 hours of sports and entertainment contents, multiple viewing options and ad skipping benefits remain the same.
The new Hopper device is expected to hit the store in the forthcoming months. The subscribers, who opt for a two-year contract, will get the Hopper device free of cost.
Higher penetration of smartphones/tablets, coupled with increased rollouts of 3G/4G LTE technology, has completely changed the TV viewing options for customers. Viewers are now demanding multiple viewing options with anytime and anywhere TV service facility. In particular, the younger generations, who are extremely tech savvy, will be highly influenced by such changes.
At present, the U.S. pay TV market is getting saturated on the back of stiff competition from other cable and telecom players. In addition, the launch of video streaming services from Netflix, Inc. (NFLX) and Hulu at lower price has further intensified the competition. Moreover, sluggish economic growth coupled with a continuous increase in cable prices have forced most of the subscribers to cut their cord and opt for cheaper online video services. In order to counter such competition, Dish Network is trying to explore new markets with its innovative over-the-top product.
We maintain our long-term Neutral recommendation on DISH Network. Currently, it has a short-term Zacks #3 Rank (Hold) on the stock.
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