Distributors Should Put More Value in Set-Tops, Dish Marketing Chief Says

SAN JOSE, Calif. - Pay-TV distributors should play up the technology included in set-top boxes in their marketing so consumers assign some value to the devices, Dish Chief Marketing Officer Ira Bahr said at a conference Thursday. Calling the set-top the “worst category name in the history of consumer electronics products,” Bahr said most consumers assign no value to the devices, and react harshly to fees associated with them. “We, ourselves and as an industry, have failed to create any distinction between what is a box feature and what is a service feature,” he said. “We're introducing a lot of features and people are yawning.” Pay-TV’s esteem among consumers has fallen when compared to coveted product along the lines of Apple’s iPhone to something little different from a power company, he said: “Many of these problems would be ameliorated if we could get to a place where people ascribe some value” to the box.

The new version of Apple TV, priced at $99 (CED Sept 2 p7), is a step in the right direction, Bahr said. “Somebody thinks that $99 is a price point that people will ascribe to a piece of technology.” Having Apple’s marketing prowess behind that device could help consumers more broadly begin to think of a set-top box as something with value, he said. “Even if it’s only $99, it will be a sea change from where we are today.” New marketing messages from Dish feature its new VIP 922 SlingLoaded box, he said. “It is clearly our intent to marry this functionality to a piece of hardware and not allow people to suggest that it simply comes with the Dish Network service,” Bahr said. “I think this is the beginning of what could be a material change in this category"

Dish partnered with Google TV in part because consumers want, and are already finding, ways to enhance the pay-TV experience, Bahr said. “This is the way the market is going.” The advantage Dish and other distributors provide is an army of installation technicians and customer support representatives to set up the devices, he said. “For the most part, having someone come over to take care of it and hand you the remote and say ‘it works,’ would be a great advantage,” he said. “I have no doubt there are tens of millions of people who want that kind of service."

As more devices that can display video enter the market, traditional pay-TV distributors risk losing control of the idea of “watching TV,” Bahr said. “On the day that ‘watching TV’ means I'm going to watch Roku or the Apple box, we lose important ground in this fight,” he said. “What we want in the end is to assure we own the primary input [on the TV set] so that when a consumer says ‘Let’s watch TV,’ they are watching Input 1 and the Dish Network,” he said. “Certainly, the inertia with respect to owning that input today must be a real competitive advantage, not just for us but for the industry as a whole.”