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Comcast to Roll Out DISH Network's Sling TV on X1 Platform

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Cable TV behemoth Comcast Corp. (CMCSA - Free Report) and satellite TV operator DISH Network Corp. (DISH - Free Report) jointly announced that the latter’s virtual MPVD (Multichannel Video Programming Distributor) platform, Sling TV, will be integrated into the cable multi-service operator’s (MSO) cloud-based, managed video delivery platform, X1.

The X1 platform is an all-in-one service which offers live TV, on-demand content, cloud DVR and video streaming. The platform includes a voice remote control as well as Spanish user-interface. Sling TV services will be made available on Comcast’s X1 platform at prices consistent with current offers on other platforms coupled with different options such as language-specific add-ons for customer comfort. Sling TV’s multicultural packages start at $10 a month. Also, more than 425 Sling TV channels will be integrated into X1.

This integration will allow Comcast’s X1 customers access numerous multicultural programs and channels. The companies are working to add Sling TV to X1 and will provide further details when the content is available to customers.

New Trend

Cable TV providers like Comcast have been facing considerable pressure due to growing demand for over-the-top (OTT) video streaming services, which has led to increased cord-cutting in recent years. People have been dumping expensive cable TV plans and shifting toward unbundled packages. To counter this competitive threat, cable MSOs recently started launching their own Internet TV offerings. Nonetheless, these offerings could not match the ease and feasibility of the OTT service. This encouraged smaller cable operator to partner with video streaming providers for offering the latter’s service through a regular set-top box. Toward this end, in the beginning of Nov 2016, both Comcast and Netflix Inc. (NFLX - Free Report) jointly announced the Netflix integration into the X1 platform. Going forward, we expect to see more such partnerships between cable TV operators and OTT service providers. Note that Netflix recently signed another collaborated with cable giant Liberty Global plc (LBTYA - Free Report) to offer its content on Liberty Global’s network.

This alliance marks the debut of Sling TV’s multicultural programming on Comcast X1 platform and hence opens up the scope for Comcast to better serve its diversified customers around the globe.

Multicultural consumers make the fastest growing segment in the U.S., increasing 2.3 million per year. Meanwhile, census projections show that this segment is poised to become a majority by 2044. Hence, Comcast is looking forward to providing culturally relevant content for diverse audiences and language groups, including Arabic, Chinese, Urdu and more.

The Bottom Line

DISH Network’s efforts to diversify its business model from being a pure-play satellite-TV operator to an Internet TV operator should help the company counter competitive threat from low-cost video streaming operators. The company is poised to benefit from its Internet TV service – Sling TV – which offers services at a reasonable rate.

Comcast is also striving to gain a leading position in the video programming segment.

Both DISH and Comcast currently have a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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