DirecTV streams NFL games for added sales
DirecTV, like rival Dish Network Corp, has been trying to boost its subscriber numbers as lower-cost online entertainment options from Netflix Inc, Google Inc and Amazon.com Inc threaten its growth.
Starting on Sunday, subscribers will be able to watch the National Football League games on Sony's PlayStation 3 videogame console in addition to the mobile version of Sunday Ticket that already was available.
To stream the games on the Playstation 3, computers or devices such as Apple Inc's iPhone, DirecTV subscribers must pay an extra $50 a year. For those who cannot subscribe to DirecTV -- either because the satellite dish has no clear line to the sky or because they live in building that bans satellite TV -- the cost would be $340 a year.
"The goal here is to open up the product to people and to test to see whether there's a new revenue stream here: selling Sunday ticket over-the-top to people who can't get DirecTV," said Alex Kaplan, DirecTV's senior director of sports marketing.
Kaplan said the company was trying to get the most from an NFL contract with an estimated annual cost of $1 billion over four years through the 2014 season.
"We'll continue to exploit it in any way possible," he said.
The company said Sunday Ticket had always been profitable, but declined to comment on revenue projections for this year.
The next step will be looking at other gaming consoles and connected devices, Kaplan said.
Brean Murray analyst Todd Mitchell said DirecTV was right in squeezing as much as it can out of Sunday ticket.
DirecTV and Dish "will increasingly look to deliver content over the top," he said. Dish won movie chain Blockbuster in a bankruptcy auction in April.
DirecTV is relying on Sunday Ticket to help win customers from cable companies such as Comcast Corp and Time Warner Cable Inc.
In its latest marketing push, DirecTV is offering a free year of Sunday Ticket to new subscribers who switch from rivals, which sparked a lawsuit with Comcast.
The company, which has about 2 million Sunday ticket subscribers, started promoting the offer after the resolution of the NFL labor dispute in the summer.
While it is unclear how many subscribers will pay for the NFL games after the promotion ends, Kaplan said: "We've seen really strong early results so far. It seems to be working."
Shares of DirecTV were down 0.4 percent at $42.43 in morning trading.
(Editing by Paul Thomasch, Robert MacMillan and Lisa Von Ahn)