DirecTV has been taking a direct approach in recruiting new customers – by offering its coveted “NFL Sunday Ticket” package free for one year.
Now, it appears they’re taking care of their existing subscriber base. The satellite provider announced that they’re drastically slashing the price of “NFL Sunday Ticket” by nearly 40%. The package, which bore a price tag of $325 annually, has been marked down to about $200. Optional access to view “Ticket” games on mobile devices is $100 for both new and existing customers.
DirecTV is hoping that the repriced package will encourage most of their 20 million subscribers to sign up for it (only between 2 and 3 million subscribers out of 20 million ordered the service as of last year). They are also optimistic that newer subscribers – lured by an advertising campaign that featured Hall of Fame player Deion Sanders as somewhat of a “football fairy” – that switched to DirecTV and ordered “NFL Sunday Ticket” would be likely to keep the package if it carried a more appealable $199.95 price, as opposed to upwards of $300.
DirecTV claims they added 1.1 million new customers since they started the “free NFL Sunday Ticket” promotion, and anticipates that while the package’s new price will result in the company losing money, they can grow revenues if they add anywhere from an additional 100,000 new subscribers to another 1.1 million.
Here’s something to keep in mind: DirecTV is in the latter years of a 20-year deal which grants them exclusive rights to out-of-market NFL games. Traditional cable operators – notably Cablevision – believe they should be able to carry the package on their systems (this is the main reason why Cablevision does not carry NFL Network). Currently, some cable subscribers may receive access to “Ticket” through their computers. But we bet they’d rather be watching the action on an HDTV, rather than a monitor.
This could be a hidden reason for the new cost of the “Ticket” package – I call it, “the Sunday Ticket reelection campaign”: make it reasonably priced to the point that it wins over millions of new customers, customers who would remain loyal to DirecTV, and not be distracted by any other means of digital entertainment – cable systems, FiOS, Hulu, Netflix, and most of all, DirecTV’s rival satellite carrier, Dish Network. With the “popular vote” in their favor, DirecTV would then embark in a new deal with the NFL, and eventually jack the price of the “NFL Sunday Ticket” package back up, just in time for the 2014 football season.
Business is business.
And without “NFL Sunday Ticket”, it’s likely DirecTV would be out of business.