Australian IPTV start-up FetchTV has flagged plans to ink deals with the 10 largest local service providers outside of Telstra by the end of the year in efforts to form a competitive “coalition” against the incumbent telco’s popular T-Box service.
The agreements, to be signed with the likes of TPG and those deemed large enough to return customer value, would complement existing agreements with Optus, iiNet, Internode and Adam Internet and boost the potential customer base for the television service.
“I think the fact that we’ve been able to nab the number two, number three and number five providers in the country bodes very well for the rest of the others,” FetchTV chief executive, Scott Lorson, said.
The 100-strong organisation was first formed three years ago as an IPTV incubator with financial backing from Malaysia-based Astro All-Asia Networks, and has worked since to develop wholesale platform agreements with some of the largest providers in order to compete with Foxtel’s pay TV service and Telstra’s T-Box service.
The FetchTV offering first became available in April last year under iiNet and was later expanded to Internode on a selected, paid user trial. Adam Internet is in continuing trials of the service while Optus most recently signed on to provide “a variant” of the service as well as a companion mobile application in the second half of the year.
Lorson said continued negotiations with at least two or three other ISPs would provide a legitimate “coalition”, a term also used recently by Internode managing director, Simon Hackett, to growth of competition with Telstra.
Should the company’s strategy prove successful, the provider coalition could potentially target slightly less than half of Australia’s 4.2 million fixed broadband customers for IPTV services.
Lorson affirmed FetchTV would not look to retail IPTV services itself directly to end-users, but that it had internal performance indicators and continually measured how many active users engage with the service over time. Its user base is expected to bloom with the addition of Optus and a full-release schedule from Internode, but currently counts some 2300 active subscribers.
This figure is overshadowed by Telstra reports of approximately 107,000 T-Box set-top box devices sold by the end of 2010.
Telstra’s success, according to Lorson, was thanks to the use of a “triple-play offering” similar to that used by successful IPTV operators in Europe and the United States. The inclusion of the service as part of a bundle - rather than an add-on as currently offered by FetchTV partners - for a sub-$99 monthly price would lead FetchTV’s strategy to gain a wider customer base, he said.
“They’ve made the process of purchase very easy for the consumer,” he said. “We’re anticipating that the FetchTV partners will do the same so if you add a compelling proposition to a simple pricing and packaging construct by well-known brands is a very powerful ingredient for fast take-up.”
Despite speculation the recent agreement with Optus would result in mobile-based IPTV, Lorson said FetchTV’s current mobility strategy was based around building a companion application to the set-top box that would allow users to view TV guides and film information, remotely control the box and purchase or rent valued content. The app would connect over Wi-Fi or 3G to the box but for the time being would not provide IPTV streaming.
Willing Optus customers would also receive the set-top box when the service is made available in the second half of the year, but Lorson refused to reveal any details as to what changes, if any, the telco would make to the user interface and functionality of the device.
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