TV networks cap number of streaming subscribers

A recent report from the Ad Age has revealed that Sling TV intends to put caps on the number of its subscribers. The rumoured limit is 2 million subscribers. If the cap limits are exceeded, networks can pull their shows and content from Sling.

The reason for the cap are the TV networks, that don't want to lose money from cable providers. Traditionally, cable companies pay the programmers for each subscriber they have.

"They want it to be a complementary product and not a competing product that cannibalizes their core business," said Geetha Ranganathan, an analyst at Bloomberg Intelligence. "They don't want it to become too popular.

Such subscriber caps are "a constructive way to make an offering to a given part of the market that does not undermine the other part of the market," Time Warner CEO Jeff Bewkes said at a media conference last year.

Subscriber limits are not new. Traditional cable operators also offer "skinny bundles" which have limits on the number of customers who can subscribe to them.

Internet-TV services such as Sling TV are designed to reach the 10 million or so broadband subscribers who don't pay for TV. At least 100,000 users have subscribed for Sling TV since its launch. The company hasn't yet confirmed the cap.

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