Sky TV extends Discovery Networks deal, launches two new channels

Before Netflix NZ [NZX: SKT] launched, reps for the company bragged that Sky TV had got content cheap. Although Netflix NZ would launch with modest content (and it did, about an eighth of Netflix US), it would expand over time.

Maybe it will. And maybe Sky is having to pay more for local rights. But it's sure not showing any signs of going backward in content, or New Zealand rights.

Shortly before Netflix NZ (and Spark's Lightbox) launched, Sky TV renewed its exclusive HBO deal for another five years and tied up Super Rugby for another half decade.

Since Netflix NZ arrived, Sky has expanded its exclusive Disney content and bagged the next Rugby World Cup. And it has gone on the offensive, catching rivals by surprise, by putting premium first-run content on its $20/month Netflix clone, Neon. 

Today the pay-TV broadcaster said it had signed a new multi-year deal with Discovery Networks covering Discovery Channel, Animal Planet, Food TV and the Living Channel. The expanded contract sees Sky launching two new channels based on Discovery Networks' content: TLC and Discovery Turbo.

Now these aren't all areas that Netflix plays in. But overall it's hard to say what's happening is following the company's narrative of Sky getting squeezed for content.

Throw in M2's unexpected capitulation over Global Mode and it has been a not bad few months for Sky. 

The bad news: new competition means new costs. Chief executive John Fellet has already warned shareholders not to expect higher dividends.

For its part, Netflix says it will double its original series output over the next year, and that all new content will be exclusive to Neflix NZ in this part of the world. But right now, even some of its own content, such as the latest season of House of Cards, is absent from Netflix NZ.