Spark boss bins decoder but can't escape Sky

In a couple of social media posts, Spark boss Simon Moutter has made a show of biffing his Sky decoder.

He is, of course, looking to boost Spark’s Lightbox.

But this jape is undermined, somewhat, by the fact that the CEO seems to be a bit of a sports fan. He’s written a whole article on his admiration for the Black Caps. His company is a Super Rugby sponsor and, heck, it’s just not viable for any New Zealand corporate leader to ignore the All Blacks.

Which brings us to this Twitter exchange.

Switched my parents from Sky Basic to Freeview plus Lightbox & free on demand Apps on new $900 Smart TV. Annual saving $630. No brainer!!

— Simon Moutter (@simonmoutter) October 16, 2016

Sending my box back to Sky TV. So much better value with Lightbox and other on demand streaming services nowadays. pic.twitter.com/TlYleHeTmD

— Simon Moutter (@simonmoutter) September 12, 2016

@simonmoutter Will you still watch All Blacks and Black Caps games live? How? Thru Sky's Fanpass? Lots of time in the pub?

— Chris Keall (@ChrisKeall) October 17, 2016

@ChrisKeall I love my sport so I'll still use Sky OD products but we need a proper wholesale content market that gives consumers real choice

— Simon Moutter (@simonmoutter) October 17, 2016

Sky’s standalone OD (on-demand) products are Neon ($15/month) and Fanpass, which offers no-contract day ($15), week ($20) and month ($56), plus ad hoc fees for premium events like Joseph Parker fights (the last was $40).

Lightbox has no movies (only TV series), so it’s possible Mr Moutter will want to tap Netflix NZ, whose cheapest plan is $9.99 a month or $119.88 a year (the $15/month Neon is, of course, an option though presumably he’ll give it a swerve).

To keep up with the BlackCaps’ heavy schedule between now and June, not to mention the 19 rounds of Super Rugby coming in 2017, plus finals, and a dozen All Blacks games – not to even consider other sports – the Spark boss’ cheapest option for Fanpass would be to maintain its $56 monthly pass all year, which would yield Sky TV a tidy $672.

Ouch. That’s quite a tidy sum to hand over to the opposition. And of course it eclipses his savings from binning his decoder, even without adding his bill for Netflix, should he choose to add that.

The Spark boss knows what he has to do about this aggravating state of affairs, of course: fight Sky TV-Vodafone by partnering with TVNZ or MediaWorks to bid for A-list sports rights as they come up.

But does he have the moxie? And if he does, can he sell it to the board and shareholders?

The low-cost alternative: regulatory change
As for the government forcing Sky TV to open up its wholesale contracts: Its competitors have been banging their heads against the political wall on that one for years through successive Labour and National governments. Their best hope is probably that sports bodies finally clock to the fact (as they have in the US, UK and Australia) that they can make more money if they split online and broadcast rights.

Spark and others have argued that Sky TV will wholesale content to all-comers, in an effort to keep up with changing media platform trends, if its merger with Vodafone is blocked.

That won't be the outcome if the merger is indeed nixed.

Sky, like others, has a challenge from viewers adopting many devices but it's dealing with it through moves like putting a Fanpass app on Apple TV. It's not going to give Spark a look in, and the Commerce Commission can't make it (as NBR has canvassed before, the regulator can only impose structural conditions on a merger, such as insisting a division or asset be sold off. It can't impose behavioural conditions, such as re-writing contracts).