Sony's streaming TV service is expanding nationwide Monday, giving TV lovers throughout the U.S. a new, potentially cheaper way to get cable channels such as AMC and ESPN.
PlayStation Vue, which had been limited to major cities during its first year, will start at $30 a month in the new regions. That's $10 cheaper than current packages, but it won't include over-the-air channels, such as stations for ABC and Fox. Vue's seven older markets—big cities including New York City and San Francisco—won't have access to the new, cheaper deal.
More people are bypassing traditional TV services in light of extensive online offerings from the likes of Netflix and HBO Now. To reach them, cable and satellite TV companies are launching Internet-based TV services. Dish debuted its $20-a-month Sling TV service last year. Comcast and other cable companies have also experimented with online TV packages, though none are offered beyond a few markets. AT&T's DirecTV service plans a nationwide streaming offering, but details on prices and channels haven't been released. Published reports have also said that Apple is trying to develop its own streaming-TV service.
Vue's cheaper offering, made available in more markets than before, could make Vue a more significant challenger to traditional TV services from cable and satellite.
"But nobody really knows how big the opportunity will be," said Craig Moffett, a MoffettNathanson analyst who follows the cable industry.
Moffett said viewers typically like the idea of slimmer, cheaper TV packages when they don't have time to watch 500-plus channels, but "everyone's ideal skinny bundle is a little different." As a result, he said, these slimmer packages still end up too expensive for many people, or are missing someone's favorite channel or two.
A PlayStation or an Amazon Fire TV device is needed to sign up for Vue.
Vue's exclusion of over-the-air channels in the new regions reflects how television networks distribute their programs in the U.S. Networks own stations only in major cities, and their programs are carried elsewhere in the country by affiliate stations owned by other companies. Because of that, Sony doesn't automatically have rights to include those stations and has limited the Vue service to major markets with network-owned channels. Traditional cable companies have had time to negotiate deals with affiliates elsewhere.
Sony will now try to bypass that limitation by offering just the cable channels live—more than 50 in the starting package. Programs from ABC, Fox, NBC and Telemundo will be available the following day, similar to the way Hulu works. CBS shows are coming to some markets only at an unspecified date. The CW isn't currently offered in any of Vue's packages. Vue customers would still be able to get local stations with an antenna.
Sling TV also lacks over-the-air channels in its starting package of 23 channels. But it doesn't include next-day access to network shows, either.
TV packages for Vue's existing markets won't change. They start at $40 and include the local stations. The broadcast-free, $30 option will be limited to markets outside the initial seven—Chicago, Dallas, Los Angeles, Miami, New York City, Philadelphia and San Francisco, as well as their suburbs. Sony hasn't revealed how many subscribers it has, but Moffett believes it is still tiny, given the service's limited reach until now.
Moffett has estimated that Sling TV has about half a million customers.
Explore further: Sony tries to make its pricy Vue TV service more popular