Sky announces record profits, extension of rugby deal, big decoder upgrade and new SVOD brand

  • Media
  • October 24, 2014
  • Ben Fahy
Sky announces record profits, extension of rugby deal, big decoder upgrade and new SVOD brand

Earlier today, Sky officially announced it has signed another five year deal with Sanzar and NZ Rugby, giving it the rights to the precious code until 2021. And at its AGM at the Langham this afternoon, it had more good news for investors and subscribers after announcing some impressive financial numbers, detailing how it will fully embrace internet-delivered television and launching its new low-price SVOD offering Neon. 

At a time when the vocal minority are talking about exclusive deals, expensive content and the impending demise of the dominant pay TV provider due to increasing competition, Sky just keeps on delivering. And almost everything that counts—subscriber numbers, average revenue per user, advertising revenue, churn, profit, the list goes on—seems to have improved in the latest figures. Sport is an extremely important part of that, with 71 percent of total Sky subscribers signed up to sport, and the Sanzar deal, as well as earlier deals with NZ Cricket and the IOC, is set to keep it that way for a while yet, even as other over-the-top players like Coliseum start bidding high, increasing the rights prices and, in the case of golf and football, occasionally snatching content. 

  • Check out NZ Marketing's in-depth feature on Sky here

For the year ended June 30 2014, Sky reported record revenue of $909 million, an increase of 2.7 percent. Net profit after tax increased 21 percent to a record $165.8 million (it expects that to increase to 8.6 percent in the 2015 financial year) and it clocked in with 865,055 subscribers, more than ever before. 

One of its big developments is to bring internet-delivered TV to MySky subscribers through a decoder upgrade early next year that will allow subscribers to watch ondemand content through their TV via their remote. Those without MySky boxes will also soon be able to do this as part of a major upgrade of all Sky's decoders. 

As chairman Peter Macourt said in his speech: 

Looking at an increasingly competitive market we must continue to expand our product offering, embrace new technologies and ensure we are meeting customer aspirations.

So what new developments is SKY working on? We are soon to launch a new video on demand service that will enhance the SKY experience for existing customers and attract new customers who don’t currently subscribe to SKY. This service will include a library of thousands of popular movies and TV series. 

At the beginning of the year we launched SKY GO which lets SKY customers view content on other screens such as phones, tablets and PC’s. There have been over 200,000 downloads of the App since launch. The next step for the SKY GO is to deliver the library of on demand TV and movies to mobile devices - giving our customers the convenience of more viewing options and better value for their SKY subscription. 

Early in the New Year MY SKY decoders are being upgraded to enable an internet connection. Users will be able to simply press the remote control and watch on demand TV and movies for channels they subscribe to. For example, if you have MY SKY connected to the internet and subscribe to SoHo, you’ll be able to download and watch TV series and box sets from SoHo at your convenience.

A new onscreen TV guide is also part of the upgrade. This will enhance the face of SKY in homes nationwide. New features like the ability to save all episodes of a series under one listing and better navigation including access to on demand content will take the MY SKY experience to the next level.

So, what about SKY customers that don’t have a MY SKY decoder? 

Well, next March we will start an 18 month project to replace all non MY SKY decoders with a new decoder that has the same features as MY SKY - like personal video recording and internet connectivity. 

Existing customers will not be charged for the new decoder and they can choose which new services they wish to subscribe to. When this MY SKY project is complete every SKY home will have the option of personal video recording and access to on demand content when their MY SKY is connected to the internet. There is another benefit in replacing our older digital recorders. At completion in 2016, we effectively double our usable satellite capacity. Right now we are essentially dual broadcasting content to the two decoder types. This opens up future broadcasting opportunities for more channels, more HD content, and even ultra HD, with the increased capacity. 

As for Neon, which is set for launch in December, it's big drawcard is that it offers HBO content like Game of Thrones and Girls and a host of movies (unlike Lightbox, which only offers TV), so it looks like a fairly compelling offer that will appeal to those who aren't keen on the all-you-can-eat buffet option of a full Sky subscription. 

As a release says:

Neon offers exclusive TV series, hundreds of movies, great factual entertainment, documentaries and brilliant family viewing. The first 30 days are free and it’s just $20 every 30 days thereafter, with no long-term contracts and no ads. Launching in December, as well as great TV and film, Neon offers all the basics that users would expect, along with some great features that will make it a breeze to use. This includes a handy bookmark so users can pick up and play where they left off, on any of their registered devices, whenever they like. Neon users can register up to five different devices and watch on two at the same time. Parents can rest assured as parental pins can be set during NEON’s simple three-step sign up, and classifications and warnings for viewers are super clear. At launch, Neon will be available on PC and Mac using an internet browser and on selected iPhones and iPads through a free Neon App. For those after a big-screen experience, it’s easy using Apple TV to stream via Airplay and customers can also connect a laptop to a TV using an HDMI cable.

Neon, which is being run by Dave Joyce, currently general manager of Igloo, will also be available on Xbox 360 and selected Samsung Android tablets and phones as of next year. 

As a result of today's news, Sky shares went up three percent, after falling over the past few weeks, possibly in relation to HBO's decision to allow direct access to its content via the internet and better compete with Netflix, potentially rendering distributors like Sky unnecessary. 

Sky is also getting set to launch a new sci-fi themed channel called The Zone. 

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