Sky’s Internet TV Service Could Offer Pay-As-You-Go Shows

BSkyB’s upcoming over-the-top internet TV service could create a new post-subscription ecosystem for pay-per-view and pay-as-you-go TV shows.

There’ll be a spectrum all the way down to individual shows – we’ll see how far we get,” finance chief Andrew Griffith said at the FT Digital Media Conference in London.

Imagine a world without satellite dishes. By this summer, Sky, in a bold step, is due to launch subscription movie, sports and entertainment bundles on connected TVs, game consoles and other devices without the usual necessity for its core satellite subscription.

But, although those bundles will be offered on a month-by-month basis, more granular options will also be on offer…

“There’s a lot of growth left in cable and satellite platforms in the UK,” Griffith told the conference. “But a psychological barrier has been the need for a dish, a 12-month contract because of the way we put set-top box in to the market and the perception (though not the reality) that you need to buy a bundle.

Over-the-top platforms facilitate new services that are more pay-as-you-go. That’s not necessarily deflating in terms of price – some of those pay-as-you-go services are more expensive – but they could reach out to a much larger base than the 13 million or so people who take (UK) pay-TV today.”

It’s a far cry from the BSkyB (NYSE: BSY) we have come to know, which regards its satellite/broadband/telephone subscription as core, and potentially a step-change for premium TV video

Soon, Sky will be offering not just Sky Movies and Sky Sports monthly subscriptions over IP-enabled devices, but also content like individual pay-per-view movies via Box Office, individual sporting events or tournaments, subscriptions only to individual drama series and even one-off rental access to individual episodes – all over internet TV devices like consoles, set-top boxes and tablets.

But how much will it cost? Sky’s new IPTV bundles will likely be priced higher than the new online subscription offers from Netflix (NSDQ: NFLX) (£6pm) and Lovefilm (£5pm), to reflect its better content line-up, but could go cheaper than or equal to the equivalent packages on its own satellite platform. After all, the new offerings won’t come with any of the infrastructure costs of satellite.

“We’re in a market with really good headroom for growth,” Griffith told paidContent at the FT Digital Media Conference. “Cable and satellite are only in 55 percent of homes, 40 percent of homes have never paid anyone for TV although they have paid for content like DVDs.

“I don’t think our content is expensive. You can buy all our content for less than the cost of a first-class stamp every day.”

In other words, don’t bet against the new IPTV bundles being roughly the same price as they are on satellite.

“You won’t have too long to wait before we announce the launch of that,” Griffith continued. “It’ll be on multiple devices, as near ubiquitous as one can make it. We will make it available on all the scale platforms.”


Sky on Thursday confirmed it will rebrand its current PPV strand Sky Box Office as “Sky Store”.