Foxtel admits SVOD remains a challenge as it unveils new offering
Foxtel has confirmed it will take the streaming services such as Netflix and Stan head on with a walk-up offering of channels for online subscribers that moves the pay TV company closer to offering a cut-price, à la carte service for viewers.
Foxtel CEO Peter Tonagh has admitted that on-demand and streaming remains a challenge and the company has more work to do to communicate its message.
Speaking at the ASTRA conference in Sydney this morning Tonagh unveiled his plans for Foxtel in the coming months as it seeks to head off growing interest in the SVOD competitors.
While highlighting that “linear viewing” of popular shows and sports remained the most popular way for Australians to watch TV, he said that Foxtel was going to make more content available online through new streaming offers.
This will include the launch of a dedicated kids app which will allow parents to tailor viewing for their children and set time limits.
The company is also investing in the development of a “puck” for streaming customers, as well as starting work on the next generation IQ, what he dubbed the “IQ6S”, with the company having completed upgrades to its troubled IQ3.
He again highlighted the puck and set-top boxes would be open platform and open to music streaming services, free-to-air catch-up and other SVOD services.
“Competition between Foxtel and the recently arrived arrived SVOD players is much more nuanced than many would have you believe,” Tonagh told the conference.
“Sure we do compete in some respects, but essentially our services are fundamentally different in ways that make Foxtel quite unique.
“Those SVOD services don’t compete for live and linear viewing and that’s viewing that represents the vast majority of Australia’s current viewing habits.”
Tonagh admitted that the company was still working to show viewers that it was more than a “live and linear” broadcaster with its array of catch-up and on-demand services.
“Despite this really wide array of viewing options, Foxtel continues to be seen by many as a traditional linear broadcaster with both customers and non-customers alike unaware of the on-demand options we have in offer for them,” he said.
“Then for others, the on-demand service needs some work …. clearly we have more work to do both on the service itself and on changing the perceptions of our service.”
Tonagh said that a new, long-term deal with HBO would give Foxtel five-times the number of HBO hours than it currently has, and will allow people to download and watch every series on demand.
“In time, every series that we do have will be available to download to tablets and smartphones.
“Yes, that means Game of Thrones – any time.”
Tonagh noted that sport remained largely a live viewing option for fans, but that drama was now seeing almost 50% of its audience watching on-demand or in time-shift.
He said there would be more pop-up channels as part of the service, led by a new Star Wars pop-up later this year, which will make all seven movies available.
“We will continue to innovate, to anticipate and to meet the changing needs of Australian consumers,” Tonagh said.
Speaking with Mumbrella after his speech, he said that Foxtel would offer more targeted packages for streaming customers but said it would not go to a full “a la carte” offering, saying Net flix had proven it did not work.
But he said the SVOD companies had set the bar in terms of pricing, with $10-$15 the accepted range in cosumers minds for such services.
“We need to tailor the packages more effectively to the consumer needs, but, like many things, if you look at our basic package on the broadcast product is perfect for mum and dad, a younger kids and an older kid, but it’s not what Australian household’s look like these days,” Tonagh said.
“So the intent with what we have done with Foxtel Play is to offer entry packages that there is one there that my mum will love, there is on there that my daughter will love, and the important thing is tailoring packages so that they fit fairly neatly.”
So basically, his opposition to SVOD is simply that .. its somebody else doing it. If we want SVOD, he’ll sell it. Except then he has to confront the price. Which (as noted above) is significantly below his current tariff, which means he just said he was going to pump money into a device, to try and capture market share, for declining revenue.
I’m sorry, can you remind me why I want my superannuation invested in this guy? If he took his 650,000+ Internet customers, and actually worked out how to monetize them as ARPU for service over IP and not just TV, I might believe in him. But sinking money in a lock-in, nah.
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The day will come soon where you Google “TV Show X” and you are presented with numerous similar web sites where you can watch “TV Show X” There will be a watch now, free, with adverts option, a pay to remove ads option, or get a subscription to watch everything option.
As much as Foxtel wants to be liked it is a lot like a Telco, we really don’t care which one as long as it works and when it doesn’t we are furious. It’s going to get a lot more fragmented out there.
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Just wait until Amazon Prime hits Australia next year, its going to get very interesting.
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Why is much of this article barely English?
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