When we asked TVNZ's head of digital Eric Kearley in early November whether TVNZ was working with Sky and would launch a set-top box before the digital switchover, he flat out said no. But last night Sky and TVNZ brought out the big PR guns and officially launched "New Zealand's worst kept secret", Igloo, the mid-play TV network that offers both pay and free-to-air channels. And while there's plenty to shout about with the new offer, there are still questions lingering about its modus operandi and whether MediaWorks will play nice.
Igloo's general manager Chaz Savage, who was previously a marketing man with Sky, angled the product at, “Mum and Dad" TV watchers who might be feeling the crunch of the slowing economy, but who still want to be able to maintain their “happy addiction with the couch"; the “middle ground viewers who may be not as engaged in such intelligent television viewing,” he says, slightly condescendingly.
The theme of the launch video was almost a hangover from the kind of 'appealing to middle-class New Zealand major-party election campaign strategies' and the new product certainly has plenty of selling points, with a combination of low cost ($200), the option to cancel the service for a month and then restart it again with no termination fee and the ability to purchase pay-per view sport and movies. The channels that currently feature on freeview are included in the package, as are Vibe, UKTV, BBC World News, BBC Knowledge, Kidzone24, MTV Hits, National Geographic Channel, Animal Planet, Comedy Central, Food TV and TVNZ Heartland.
Live pay-per-view sports events and rent titles are available to purchase from a catalogue of over 1,000 movies and TV episodes. And On Demand films and TV episodes are streamed over broadband connections and are available to view for 48 hours on Igloo.co.nz.
The Igloo team said it all came about because Kiwis wanted it, with a six-month market research project indicating the 50 percent of the population not already part of a pay-per-view package want an array of entertainment and option of sport viewing, live pause stream, media player, an easy-to-use universal interface and an assurance they will not be adversely affected by the analog to digital switch-over.
A basic package costs $25 per month and the lack of a MySky style decoder and installation fees will keep costs down. According to the NZ Herald, the arch-enemies-cum-new broadcasting chums are hoping for 50,000 subscribers to sign up within two years and are aiming to get around $10 million of one-off revenue from sales of the set-top box and $15 million in subscriptions.
The 'pre-pay TV' idea, like that seen in the UK with Top-UP TV, is one that looks likely to appeal to many viewers who want something inbetween, and Ellis said there was a “pent-up interest in a sports channel after the Rugby World Cup, those viewers who don't want to be paying for a sports channel all the time can watch the odd game of netball or rugby if they want".
But many industry pundits believe this is all about spectrum hogging to lock the other players out, including telcos looking to buy up bandwidth for 4G (the DTT spectrum is now close to capacity). And the fact that there is no recording functionality on the box, despite Sky's big success with MySky, indicates to some that they aren't really trying to make it work.
They deflected all questions about Sky's monopoly and departing TVNZ chief executive Rick Ellis said he had no qualms about competition issues. “Igloo is adding choice" (Ellis refuted allegations that he made submissions to the review on broadcasting and criticised the dominance of Sky a few years back and dismissed the fact that Freeview will be undermined by this move because it is not a commercial company).
But MediaWorks probably doesn't see it that way. They chose not to attend the launch and there is talk about whether they will withhold their electronic programming guide listings (EPGs) for TV3 and Four. Sky TV is still withholding the EPG for Prime from TiVo.
UPDATE: MediaWorks' Rachel Lorimer sent this statement: "There have been informal discussions but no formal approach from Igloo to MediaWorks, so although we understand from their launch statements that they intend to have our content on the platform, we're not in a position to comment on this until we have more information about what is intended."
MediaWorks will also be annoyed that revenue from monthly subscriptions will go to TVNZ and Sky, which own 49 percent and 51 percent respectively. However, Sky's chief executive, John Fellet said MediaWorks will have the rights to any downloads on the Igloo website and will be paid for them. Independent producers won’t be paid any more for their content.
And, despite rumours that Igloo would be able to double as a fully-functional MySkiHDI decoder and subscribers would be upsold to the full package (much like free-to-air viewers are on Prime with the numerous Sky ads), Savage said that wasn't the case.
All the branding was done by Interbrand Sydney. And they are currently in talks with ad agencies about the advertising (we've heard Barnes, Catmur & Friends and Sugar are in the running).