DISH Network (NASDAQ: DISH ) may have lost the high-stakes poker game over some serious wireless operations, but the satellite broadcaster has plenty of backup ideas up its sleeve. First up: a fresh marketing agreement with Southwest Airlines (NYSE: LUV ) that delivers free movies and TV shows to Southwest passengers, courtesy of DISH.
The service delivers a subset of the content you'd get as a DISH customer with a Hopper account. Just like the Hopper deal, you'll watch a limited selection of live TV channels along with "up to 75" on-demand programs via your own mobile electronics. The data stream is powered by Southwest's onboard Wi-Fi service.
DISH suggests using Apple (NASDAQ: AAPL ) iPads and iPhones, and actually handed out free iPad 2 tablets (a two-year-old model that still sells for $399) to about 100 Southwest passengers in a launch-day stunt. Android users and other mobile platforms are taking a gamble as the service only supports "some" mobile devices without providing a comprehensive list.
For Southwest passengers, it's a pretty sweet deal. The movies stream totally free of charge. You don't even have to pay for the $8 in-flight Wi-Fi service separately, as the DISH media travels on a separate single-purpose network, according to a Southwest blog post.
All told, it's a solid selling point for Southwest flights. The company still trails behind the entertainment options on fellow hub-less airline JetBlue (NASDAQ: JBLU ) , which already offers multichannel satellite TV via DISH competitor DIRECTV as well as digital radio courtesy of sector leader Sirius XM.
JetBlue's Sirius and DIRECTV media is streamed through the built-in screens, so Southwest is certainly saving some money on hardware installation here.
Mind you, I'm not knocking Southwest's media efforts at all -- most airlines don't come close to either one of these customer-friendly feature packages. It's just worth pointing out what DISH and Southwest are up against in the free market.
Finally, DISH is clearly treating this program as a marketing exercise with a side of target practice. Southwest returns the free-movies favor by including ad spots for DISH in the media stream, as well as in various parts of the in-flight and booking experience. It's a chance for the satellite broadcaster to spread the word about its services, not to mention working up its muscles for a larger Internet-based launch down the line.
In the long run, DISH just might give up on the capital-intensive satellite game to become a pure digital streaming service. That's what the wireless bets are all about, and why the company could use some small-scale digital streaming practice like this project.
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