Media

Dish launches new high-speed Internet service. Could a web-based TV bundle be next?

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Satellite TV service provider Dish Network officially debuted its new broadband Internet service dishNet today, giving U.S. consumers yet another way to gain access to the web.

The service is a result of Dish’s partnership with ViaSat, and will target customers in rural areas that don’t have access to high-speed broadband services, such as those provided by Time Warner Cable and Comcast.

The dishNet service, which will be available Oct. 1, will offer connection speeds of 5 Mbps downstream/1 Mbps upstream and a 10GB data cap per month. By itself, it will cost $40 per month, or $30 per month if you bundle it with Dish’s TV service, (a tactic that’s frequently used by big cable providers). We first heard rumblings of the dishNet Internet service last month, and I wouldn’t be surprised if Dish partnered with other companies in the future to expand its new ISP business.

And speaking of new business, Bloomberg is reporting that Dish is in talks with a handful of TV networks to provide a new TV subscription service available over the Internet. The report indicates that the bundle of channels would be much smaller than a traditional TV subscription, and cost much less. The rumored bundle is said to include only the more popular channels from media companies such as Viacom (MTV, Comedy Central), Disney/ABC (ESPN), and Scripps (HGTV, HSN, Food Network). There was no mention of whether Dish’s Blockbuster streaming service would be included as well.

A web-based TV bundle like this would be a bold move by Dish to steal current customers away from big cable companies, and attract former cable TV customers who were previously unsatisfied by high monthly bills and not enough valuable content.

If true, Dish could end up with a very consumer-friendly TV/Internet packaged plan that costs consumers less money, and it might possibly be more profitable than its standalone satellite TV service business. Of course, media companies historically have an all or nothing view on licensing agreements — meaning they demand that cable/satellite TV providers pick up several of their channels (at a higher cost) to get the ones people actually want. But that’s not the only hurdle Dish would have in offering customers a web-based TV bundle.

I’ll admit that the idea of an IP-based live TV service is a stretch, not just for Dish, but any TV service provider. Offering a highly-trafficked, continuous stream of video content is not only costly, but difficult to maintain reliably during peak viewing hours. Plus, consumers seem relatively happy with an on-demand content model, even when recently premiered episodes from major  broadcast TV station shows (NBC, Fox, ABC, etc,) have multi-week delays on availability. For instance, Hulu Plus subscriptions have grown rapidly, despite additional delay stipulations on recent content.

But regardless of how the content is delivered, there is definitely interest among consumers for a better TV service.

Photo via Dave Lindblom/Flickr

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