Sky strikes back

Two potentially potent threats to Sky TV have fallen flat.

New ISP Fyx launched a ‘global mode’ service on Tuesday, giving New Zealanders access to usually geo-blocked US-based movie and TV download services.

Sky TV told NBR ONLINE it was watching the initiative closely.

In the event, there wasn’t much to watch. Fyx folded its global mode by Friday, citing un-named issues that had to be worked through.

And Quickflix launched its streaming video service in New Zealand with calls for regulatory reform over content rights (specifically, a similar law to the “anti-siphoning” legislation pending in Quickflix native Australia, which prevents a pay TV provider monopolising live coverage of a major sports event).

But the government wasn’t listening.

In Australia, Quickflix offers Game of Thrones and other TV shows made by one of its major investors, HBO. Here – with the marquee US broadcaster's series locked up by Sky – Quickflix offers a handful of creaky  offerings such as Fawlty Towers.

In a submission to the Commerce Commission made public last week, Quickflix said Sky TV’s content arrangements would hinder the uptake of Ultrafast Broadband (Telecommunications Commissioner Ross Patterson has raised the possibility that competitively priced pay TV service, if included in a single bundle, will help fast internet uptake).

Quickflix has fallen so far under the radar that it’s hard to find a single reference on social media (beyond those by carping journalists).

And while in a parallel universe TelstraClear, Telecom and TVNZ pooled their resources to form a serious alternative service, in the world where we live they have meekly fallen in line behind Sky (albeit with TelstraClear offering a little rhetoric about what it sees as the restrictive nature of Sky TV's partnerships with ISPs and telcos).

Nevertheless, on the eve of its igloo joint venture with TVNZ (which will offer pre-pay TV, and pay-per-download movies), Sky TV is sensitive to any criticism.

And it as duly delivered a serve to Quickflix and its boss, Chris Taylor (one-time head of Prime on this side of the Tasman).

Sky says Quickflix doesn’t know what it’s talking about when it comes to television content.

“In every country, every TV provider has exclusive premium content arrangements and every TV provider - and telco for that matter - can bid for that content if they wish to,” says Sky CEO John Fellet.

“The fact is the rights to the most-watched TV shows in New Zealand sit with TVNZ and Mediaworks exclusively, not Sky yet Quickflix doesn’t seem to complain about that.”

Mr Fellet says Sky's only first-run entertainment content, like Game Of Thrones, is on the SoHo channel and it is all made for pay TV cable.

“These shows, which are expensive to buy and even more expensive to make, simply wouldn’t exist without the pay TV model yet Quickflix thinks it should be entitled to them as of right. By all means, they can bid for it at the same time we do or get the rights to it after our exclusive timeframe is over.

“This is no different to the situation that prevails with top TVNZ and Mediaworks shows like Terra Nova, Homeland, Grey’s Anatomy, Coronation Street, Desperate Housewives, Vampire Diaries, The Mentalist, Revenge, House, Modern Family, The Simpsons, Two And A Half Men, Sons Of Anarchy, CSI, The Good Wife, Breaking Bad – not one of which is available on Quickflix.

“TVNZ and Mediaworks also have the exclusive rights to show many of these programmes online via their On Demand service.”

Mr Fellet says HBO and SoHo shows represent just 5% of the US and UK series shown in New Zealand; the rest sit with TVNZ and Mediaworks.

“When Quickflix head Chris Taylor was CEO of Prime in New Zealand, he did exclusive deals for shows like Top Gear and Weeds. Would he now surrender those to online start-ups? I very much doubt it. Likewise in Australia he holds exclusive rights for HBO content, I doubt he offered them to channel 7, 9 or 10.”

The quick demise of Fyx's global mode will make it hard for any ISPs that follows (and one of the Big Five was seriously considering it) to sign up customers for a similar scheme.

That's good news for Sky TV.

Is core business is safe by dint of the fact no "over-the-top" provider in the US is ever going to offer All Blacks games.

But in its latest earnings report, the pay TV broadcaster said SoHo was central to its recent growth in subscriptions.

For now, that flank has been protected.