It's Time For Free Satellite
- Thread starter Scott Greczkowski
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I think this is a great idea. They could make enough off of the install to make up for their cost of the local channels and the customer ended up paying the money for the install which saved Dish Network money.
If cable companies just keep raising prices and reducing service offerings, I think satellite will be fine just doing things as they are.
I would guess that the listed charge for locals in every package is offputting to someone comparing cable with sat. Locals are "free" on cable.
It would benefit the satellite companies to a. make sure that every customer gets some form of locals and b. don't charge for it.
If you can't get a customer locals, handle it as a discount/rebate.
I think that free locals is a good idea, if it is matched with that lifeline package they are already offering. I think that the sat companies can effectively compete with a $10 lifeline package. I'm not sure that the free local customer will upgrade in large enough numbers to make this worthwhile.
The way I see it, Dish could offer a $12/month lifeline locals package by simply taking the $5.99 locals fee and the $6.00 minimum service fee and offering that. DirecTV could do something similar. The problem would be advertising such a deal as it wouldn't be profitable to do some kind of awareness campaign. I suppose they could just give out some club dish cards to existing customers to give to friends/family who don't subscribe to pay TV. The offer could be for a 301 receiver and a dish 500 with install.
The problem with these setups is that the financial beating that comes with it. If you add too many low package customers, then you are rated with a lower ARPU (Average Revenue Per Unit). This is an estimate of what the average customer is worth. The second is the SAC (Subscriber Acquisition Cost) would be the same as far as installation expenses go. At $12/month, it would take a long time to recoup that investment. Then there's the equipment, although that is considered leased equipment. Investors get scared off when your average customer is not worth much.
The problem with these setups is that the financial beating that comes with it. If you add too many low package customers, then you are rated with a lower ARPU (Average Revenue Per Unit). This is an estimate of what the average customer is worth. The second is the SAC (Subscriber Acquisition Cost) would be the same as far as installation expenses go. At $12/month, it would take a long time to recoup that investment. Then there's the equipment, although that is considered leased equipment. Investors get scared off when your average customer is not worth much.
Dish Network already offers locals for around $12 if all you want is the locals. They are supposed to have a very small package soon that will be for $15 that includes locals. This will be their lifeline service which is a good introductory package.
Put up a satellite dish just to get locals? Only if no other method exists. Using that as a tool to get more customers is absurd.
