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Ergen Warns DTC Programmers: Don’t Be the Next HBO

Dish Network Founder and Chairman Charlie Ergen had some typically stern warnings earlier this week when he was asked several times about media companies, including Discovery, simultaneously distributing programming on Dish pay TV platforms and through direct-to-consumer subscription streaming channels. 

Dish Network

(Image credit: Dish Network)

During Dish’s Q4 earnings call, he cautioned these media companies not to become the next HBO. 

Back in October 2018, he recalled, WarnerMedia elected not to renew its carriage deal for HBO with Dish (yes, he described this as the programmer's decision). “They wanted minimum guarantees from us and high prices that made no sense for us to pay,” Ergen said. 

The divorce with the leading premium network came six months before HBO debuted the eighth and final season of its smash original series hit Game of Thrones.

Despite this, “We didn’t lose many customers, let me put it that way, because our [subscriber] relationship was strong,” Ergen said. “They wanted Showtime and Star and other things—Netflix, and so on. 

“And HBO lost a revenue stream,” he said. 

The notion that Dish didn’t lose many customers is certainly debatable. The company had nearly 12.7 million customers across Dish satellite and Sling TV at the end of the third quarter of 2018, just before it turned out the lights on HBO (or the other way around--whatever).

Dish reported just over 12 million subs across pay TV platforms at the end of the second quarter of 2019—a loss of over 600,000 paid customers—just after the final season of Thrones finished up. 

Of course, Ergen remains perhaps the most eager of happy carriage warriors, and has frequently over the years maintained that programmers devalue their linear networks when they take them over the top. 

Notably, he also had pointed words specifically for Discovery, which on the same day, reported nearly 12 million OTT subs worldwide, most of them belonging to new SVOD service Discovery Plus

“I think Discovery has got great content,” Ergen said. “And we've had a long-term relationship with them. But obviously, to the extent that you can get it on a la carte basis, it will affect future negotiations."