• Sling TV’s “Happy Hour Across America” Could Drive Further Cord-Cutting

    Yesterday, Sling TV unveiled its “Happy Hour Across America” promotion which allows viewers free access to Sling Blue during the 5pm-midnight window. Sling Blue includes 50+ linear TV networks, cloud DVR and a 50K title VOD library. There were already significant macro trends driving cord-cutting of traditional pay-TV. The Happy Hour promotion follows Sling’s prior “Stay in & Sling” initiatives.

    Following are some of the reasons why Sling TV’s new Happy Hour promotion could further accelerate cord-cutting:

    1. Free is hard to compete with, especially during hard economic times. It’s an obvious statement, but if viewers can get something for free that they previously paid for, a certain percentage of them will switch to the free option. This is even truer during hard economic times, when many household budgets are being cut.

    2. Viewership is trending toward news and entertainment. News viewing is up 164% according to Sling and 75% according to YouTube; other reports have substantiated the trend as well. Sling Blue includes the top-rated news networks Fox News, CNN and MSNBC plus others like Bloomberg, Cheddar and Newsy (though it doesn’t include local broadcasters, which have also seen viewership increases) and also has a wide variety of entertainment networks (e.g. A&E, AMC, Comedy Central, Lifetime, etc.). For many viewers this is probably plenty, especially given all of the other options to augment (see next).

    3. SVOD and AVOD options are proliferating. For non-news content, SVOD and AVOD alternatives are proliferating, with launches of Quibi, Peacock and HBO Max all occurring. Other promotions like free HBO programs and movies on both Roku and Amazon are giving viewers even more options.

    4. No live sports to miss. Sling Blue doesn’t include ESPN or regional sports networks, but during the virus there aren’t any live sports to watch anyway, so paying a premium for a traditional bundle has less value. Aside from the promotion, the lack of live sports has been undercutting pay-TV’s core value proposition.

    5. Primetime covered in 7 hour promotional window. The promotion encompasses the traditional primetime window and other hours. While some viewership has moved to mid-day hours, evening primetime is still the most important, and the promotion covers it.

    6. No credit card required. Millions of people are understandably reluctant to take on any additional financial obligations right now. By not requiring a credit card, the promotion significantly reduces barriers to try it.

    The new Happy Hour promotion will check a lot of boxes for many households, though certainly not all (and then there’s inertia to consider). Still, it seems like a clever move for Sling TV to get a lot of people trying Sling Blue, which it will inevitably attempt to convert to paid subscribers at some point (note Sling TV hasn’t said how long the promotion will last). Once viewers sign up, if they’re satisfied, it seems like it’s going to be a pretty straightforward decision to cut the cord. The longer the virus squeezes household budgets, the more impact there will be on cord-cutting.