What Business Owners Can Learn From the Dish-HBO Contract Fight
With many popular shows popping up in time for summer, like the final season of Game of Thrones, Big Little Lies, and many more, it’s no surprise die-hard fans want to ensure they have options available for viewing. Unfortunately, many Dish customers were especially concerned about their ability to view these programs, as the company has been involved in a contract dispute with HBO for many months. While situations like this can be frustrating for fans, business owners can learn quite a bit from how corporations handle conflict.
It hasn’t been a great year for Dish or HBO, with HBO losing nearly three million customers and Dish suffering some of the steepest subscriber losses in the pay-TV industry. Dish warned even more patrons could leave if no deal was struck with HBO by April, as the highly anticipated final season of Game of Thrones was slated to premiere on the 14th.
On Dish’s website however, the company told its subscribers to download the online version of HBO—HBO Now, to watch these in-demand titles. Unlike cable TV providers however, Dish has a multitude of customers that reside in more rural areas where internet connections might not be fast enough for streaming.
HBO severed ties with Dish on November 1, 2018, and since then the two companies have shown no signs of moving towards a new agreement. John Stankey, CEO of AT&T Inc.’s WarnerMedia, which owns HBO, spoke with Dish Chairman, Charlie Ergen, last year but unfortunately made no headway in resolving their ongoing issues.
Jonathan Chaplin, an analyst at New Street Research, thinks sufficient pressure exists to help propel the companies toward striking a new deal. “Dish will no doubt survive, but it would be additional pressure on a business already fighting tough trends,” he said. “Ergen is a dealmaker,” Chaplin added. “If there is a deal to be done that makes economic sense for him, he will do it. He has a view on how many subscribers he would lose and what he is willing to pay to keep them. He won’t pay a penny more.”
Disputes such as these between network owners like HBO and pay-TV providers like Dish are fairly common today. The growing influx of viewers dropping their pricy cable subscriptions in favor of streaming services like Netflix and Hulu will likely only continue to rise. Cord cutting like this has pressured both sides to squeeze profits from fewer subscribers.
For now at least, Dish investors don’t seem too worried. Its shares are up more than 25 percent this year, and are about double the gain for the S&P 500. Investors value Dish largely on the wireless spectrum it has acquired and less on its satellite-TV service.
Houston Business Litigation Attorneys
Each business handles disputes in its own unique way, but there are many paths available when it comes to resolving them. The path you take will be determined by your circumstances and goals. Litigation is one tool that can help resolve legal disputes, and it has both advantages and disadvantages. The Houston business litigation attorneys at Adair Myers Graves Stevenson can explain the potential risks and benefits associated with taking a case to trial so you can feel confident about your decision. Contact us today to see how we can help you.