Big drop in Sky subscribers

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#1554394 17-May-2016 21:16

I guess part of what I'm trying to say is that they are now a comparatively expensive option. Unless they want to outright compete on price, which I suspect they can't do, they have to compete on wider value for money. This means improving the user experience.

They have made some steps in this direction, especially with on-demand. But they need to do more.

There are some obvious options, some of which have some cost, some of which won't cost much if anything, and some of which might actually make money.

Some random thoughts:

Offer a high-end premium decoder (possibly for a higher rental). This could feature, for example: a working 60-second skip button, a much bigger hard drive, provision for external storage (encrypted and tied to the decoder if worried about piracy), a DLNA server so recordings can be watched across a network, ability to work as a media server and play files from DLNA servers, add terrestrial as well as satellite tuners, uprated processor so it's more responsive. Basically, a box which can become the entertainment hub of the house.
As far as possible, get rid of the ads and incessant promos that constantly interrupt shows - at least on channels like the Zone that they have complete control of.
Stop the awful practice where, as soon as a show ends, the credits are squeezed to a small portion of the screen and a loud shouty promo starts. Particularly on premium channels like SoHo.
While they are at it, stop the distracting in show interruptions - spinning beer ads in the corner of a screen during rugby games, exhortations about on demand in the corner of the screen during game of Thrones, huge banners across the bottom telling me what's up next.
Ability to register an android/iOS device to the decoder, and copy content off the box (in SD if necessary) for viewing on the go.
Let me disable the irritating requirement to enter a PIN for R18 films during the day, and not have to do it each time. I currently have no children in my household.

Basically, if you are going to charge me a higher price, provide an experience that makes it feel pleasant and value for money compared to alternatives.

mattwnz

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#1554507 17-May-2016 23:53

surfisup1000:

Sky increasing their prices....

http://www.stuff.co.nz/business/industries/80092907/sky-tv-to-raise-prices-as-annual-content-costs-rise-by-30-million

Got to laugh, morningstar recently recommended they drop prices due to competition from other online services haha.

This is my first year not to receive the dreaded we are increasing our prices letter woohoo!!!

This is funny, because I am sure I read somewhere here only a day or so ago, where someone was asking when they would be increasing their pricing. So it looks like it is something they do annually around this time each year. Apparently it is due to the rugby rights being a lot higher. Yet they are increasing it on basic, which doesn't get the rugby. They really need to sort out a different model. Apart from some sport, they don't really have much that is going to keep people hooked. Maybe selling some of their sports content to lightbox on a subscription model. Lightbox has a potential huge base now with their spark broadband customer base, who can now potentially get lightbox free, and can watch it on any tv with a chromecast using any smartphone. Maybe sky should also become an ISP?

tdgeek

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#1554532 18-May-2016 07:25

JimmyH:

I guess part of what I'm trying to say is that they are now a comparatively expensive option. Unless they want to outright compete on price, which I suspect they can't do, they have to compete on wider value for money. This means improving the user experience.

They have made some steps in this direction, especially with on-demand. But they need to do more.

There are some obvious options, some of which have some cost, some of which won't cost much if anything, and some of which might actually make money.

Some random thoughts:

Offer a high-end premium decoder (possibly for a higher rental). This could feature, for example: a working 60-second skip button, a much bigger hard drive, provision for external storage (encrypted and tied to the decoder if worried about piracy), a DLNA server so recordings can be watched across a network, ability to work as a media server and play files from DLNA servers, add terrestrial as well as satellite tuners, uprated processor so it's more responsive. Basically, a box which can become the entertainment hub of the house.
As far as possible, get rid of the ads and incessant promos that constantly interrupt shows - at least on channels like the Zone that they have complete control of.
Stop the awful practice where, as soon as a show ends, the credits are squeezed to a small portion of the screen and a loud shouty promo starts. Particularly on premium channels like SoHo.
While they are at it, stop the distracting in show interruptions - spinning beer ads in the corner of a screen during rugby games, exhortations about on demand in the corner of the screen during game of Thrones, huge banners across the bottom telling me what's up next.
Ability to register an android/iOS device to the decoder, and copy content off the box (in SD if necessary) for viewing on the go.
Let me disable the irritating requirement to enter a PIN for R18 films during the day, and not have to do it each time. I currently have no children in my household.

Basically, if you are going to charge me a higher price, provide an experience that makes it feel pleasant and value for money compared to alternatives.

Good points. Price is an issue, and if they increased box rental, thats even more. BUT, let us ay off th box, even if we can't keep it, rent at 20 a month till the box cost is recovered.

Id add, lose the sports subsidy to make Basic cheap. Basic has less then NF and LB but it has a nice wee coverage of everything. Sky isn't based on a gazillion movies and TV series, so keep Basic cheap. Sports costs what it costs, and $60 seem to be a common figure for overseas full sports coverage.

But, all this needs to go to SVOD to compete with other SVOD as then the costs to provide are similar.

dafman

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#1554564 18-May-2016 08:51

Sky's response to their current situation is to increase prices??? Comical, if just not sad. I even did a quick check it wasn't April 1.

I especially liked their comment that they expect Neon revenue to rise, given that Neon is highly priced relative to the competition and not even HD.

How will this play out? I expect a change of CE and senior management at some point in the future as shareholders lose patience.

tdgeek

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#1554568 18-May-2016 08:57

dafman:

Sky's response to their current situation is to increase prices??? Comical, if just not sad. I even did a quick check it wasn't April 1.

I especially liked their comment that they expect Neon revenue to rise, given that Neon is highly priced relative to the competition and not even HD.

How will this play out? I expect a change of CE and senior management at some point in the future as shareholders lose patience.

price rises are normal, for everyone. But, they are buying time as they surely move to SVOD from satellite. Telling the 800000 customers that we need to but we wont is a start.

Dropping hints what cool things may happen is another start. But no. Breadcrumb hints would help

Benoire

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#1554584 18-May-2016 09:07

How can they move to SVOD without undercutting the satellite service? If they're tied in to their contracts for another 4 or 5 year for Optus D1, then SVOD (unless priced the same as the Satellite package) will eat in to their revenue, they can offer it as an add on as they've done through the decoder and sky go, but the base charge needs to be equivalent to satellite distribution for them to remain financially alive. As has been said before, they signed this long term contract before SVOD was a thing and they've got to see it through I suspect before they can restructure.

It might help to release their longer term plans after Optus D1 is done, but really how many NZers have decent enough internet to stream 9MBPS HD quality TV (Soho's bitrate is 9mbps, or there abouts when I last checked a recorded file); this is a genuine question... Most geekzoners are technically savvy hence we where here but are the typical mum and dad in the same position? Do they care about their internet enough to realise that it would impact on SVOD when multiple people are using it? I'm in Auckland and VDSL, but I'm not set to get fiber till 2020 at the moment - how many around me are just running ADSL2+ on old 1960s wiring and copper from the cabinets? I'm only 200m from the cabinet but can only get 35mbps download due to the wiring (not complaining though!)

Is NZ Internet infrastructure ready for a wholesale shift to SVOD as if Sky loses its city based customer to SVOD, they won't be able to offer the service to the remaining without increasing the cost (assuming their structure is efficient and the DVB-s system is a massive fixed cost); if they went under or changed to SVOD would the rural areas and smaller towns have sufficient capacity and bandwidth to deal with this increase? Again, a genuine question?

tdgeek

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#1554589 18-May-2016 09:16

Benoire:

How can they move to SVOD without undercutting the satellite service? If they're tied in to their contracts for another 4 or 5 year for Optus D1, then SVOD (unless priced the same as the Satellite package) will eat in to their revenue, they can offer it as an add on as they've done through the decoder and sky go, but the base charge needs to be equivalent to satellite distribution for them to remain financially alive. As has been said before, they signed this long term contract before SVOD was a thing and they've got to see it through I suspect before they can restructure.

It might help to release their longer term plans after Optus D1 is done, but really how many NZers have decent enough internet to stream 9MBPS HD quality TV (Soho's bitrate is 9mbps, or there abouts when I last checked a recorded file); this is a genuine question... Most geekzoners are technically savvy hence we where here but are the typical mum and dad in the same position? Do they care about their internet enough to realise that it would impact on SVOD when multiple people are using it? I'm in Auckland and VDSL, but I'm not set to get fiber till 2020 at the moment - how many around me are just running ADSL2+ on old 1960s wiring and copper from the cabinets? I'm only 200m from the cabinet but can only get 35mbps download due to the wiring (not complaining though!)

Is NZ Internet infrastructure ready for a wholesale shift to SVOD as if Sky loses its city based customer to SVOD, they won't be able to offer the service to the remaining without increasing the cost (assuming their structure is efficient and the DVB-s system is a massive fixed cost); if they went under or changed to SVOD would the rural areas and smaller towns have sufficient capacity and bandwidth to deal with this increase? Again, a genuine question?

The satellite contract ends 2019 I read here from Ockel. They have to move, and they have to wear that cost. They cant drive a car at 15 mpg when everyone else's car gets 35mpg. Their box supports SVOD. Can they retain satellite for those that need it without it costing an arm and a leg for the decreasing users? No idea. If they do nothing, the company will wither and die. Or they become a Sports based provider and cut back the whole company, reduce the share lsiting to accommodate that smaller business

They need to use the profits and reserves soon to update themselves, or those funds will be used to fund ever decreasing profits

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Benoire

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#1554603 18-May-2016 09:32

Indeed, Sky have to do something, SVOD is upon us (despite the fact that I hate the service due to many poor things I've described before). My personal opinion is that SVOD is never going to be good for sports, especially fast paced ones, though. The encoding/distribution is too reliant on a service which has highly variable outcomes and does not guarantee a bandwidth above 190Kbps(I think that is the current official bandwidth per connection?). Until the internet backbone in NZ can supply a constant 4mbps to homes for sports it will potentially look crap, like PLP did for me, and would get worse if there where another 800,000 users utilising the internet for TV consistently.

Anyway, it will be interesting to see how this plays out, I have no love for Sky or any other provider, to be they simply offer a service that I meets my budgets and shows what I want; once that changes then I will reconsider. If they lose F1, then I would generally have no reason for Sky Sports for example. This is an important time for them, they need to consolidate and try to evaluate their offerings properly while testing the SVOD market.

darylblake

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#1554627 18-May-2016 10:04

I stand by my previous comments. They are slowly drifting apart. I absolutely hate the fact that you pay for SoHo and still get so many advertisements as well but that is another story.

If they don't do something to start making money again then they wont be able to afford to pay for exclusive rugby rights again, and then they will start to have serious subscription problems, but Sky have gotten away with charging really expensive fees for a long long time and now the chickens are finally coming home to roost, hey presto all of a sudden they have problems.

Increasing their pricing is a risk, personally I think most people will just pay it. There wont be many people canceling a subscription over a $1.61c rise for sports. In saying that, the reason people are cancelling subscriptions are because the "bundle" of sky is too expensive. Its between $50 (for cheapest package with no mysky), and ($195 if you want all the channels with mysky+) and Hell I am probably going to buy a fanpass for the olympics.

Most of the content on sky is annoying. The news is absolutely terrible, what is it Fox News? Last time I looked it was a whole bunch of Australians in a news room talking about Donald Trump. Its pay tv that is riddled with Ad's. Once again I would much rather buy Netflix and Hulu where I get hardly any interruptions, and a fanpass every so often to watch the cricket, rugby or olympics. Im not an NRL fan so I don't need sport all day everyday. If I wanted to watch ad's I would leave the shopping channel on, it doesn't cost anything to watch.

On another note why don't they just offer to deliver it over UFB (as an option) instead of installing satellites. Obviously people who already have satellites can use them and I understand most people dont have UFB yet, (and not all areas will get it), but by doing so they could track metrics about what people are watching better and perhaps help make some better business decisions on what shows to buy.

MikeB4

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#1554634 18-May-2016 10:13

darylblake:

I stand by my previous comments. They are slowly drifting apart. I absolutely hate the fact that you pay for SoHo and still get so many advertisements as well but that is another story.

If they don't do something to start making money again then they wont be able to afford to pay for exclusive rugby rights again, and then they will start to have serious subscription problems, but Sky have gotten away with charging really expensive fees for a long long time and now the chickens are finally coming home to roost, hey presto all of a sudden they have problems.

Increasing their pricing is a risk, personally I think most people will just pay it. There wont be many people canceling a subscription over a $1.61c rise for sports. In saying that, the reason people are cancelling subscriptions are because the "bundle" of sky is too expensive. Its between $50 (for cheapest package with no mysky), and ($195 if you want all the channels with mysky+) and Hell I am probably going to buy a fanpass for the olympics.

Most of the content on sky is annoying. The news is absolutely terrible, what is it Fox News? Last time I looked it was a whole bunch of Australians in a news room talking about Donald Trump. Its pay tv that is riddled with Ad's. Once again I would much rather buy Netflix and Hulu where I get hardly any interruptions, and a fanpass every so often to watch the cricket, rugby or olympics. Im not an NRL fan so I don't need sport all day everyday. If I wanted to watch ad's I would leave the shopping channel on, it doesn't cost anything to watch.

On another note why don't they just offer to deliver it over UFB (as an option) instead of installing satellites. Obviously people who already have satellites can use them and I understand most people dont have UFB yet, (and not all areas will get it), but by doing so they could track metrics about what people are watching better and perhaps help make some better business decisions on what shows to buy.

Sky is still making money, their total assets are circa $1.9 Billion and for Fiscal 2015 they returned a Net profit of $170 million.

Benoire

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#1554635 18-May-2016 10:14

I 'only' pay $139 for everything on Sky (basic, movies, sports, soho, HD ticket & HDi decoder) I presume the 195 is if you want the other private channels offered by sky such as rialto and rugby channel which they do not own?

If they where to offer it by UFB, that would be an additional cost they would have to bear (or the customer would) as not only would they be paying for the distribution by satellite but then the distribution by the internet which isn't that cheap either. Do we know if Netflix NZ is subsidised by the parent company or are they stand alone as that might give an indication of the distribution costs; or perhaps the NF parent company has agreed global deals with the various CDNs which is split across all their operating countries?

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#1554690 18-May-2016 11:07

darylblake:

Most of the content on sky is annoying. The news is absolutely terrible, what is it Fox News? Last time I looked it was a whole bunch of Australians in a news room talking about Donald Trump.

I think you'll find that Fox News is a US channel.

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#1554691 18-May-2016 11:08

Benoire:

If they where to offer it by UFB, that would be an additional cost they would have to bear (or the customer would) as not only would they be paying for the distribution by satellite but then the distribution by the internet which isn't that cheap either.

Vodafone TV is Sky over UFB.

Benoire

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#1554692 18-May-2016 11:10

But don't you pay vodafone for the privilege and not Sky? Vodafone is setup for this as it runs a large amount of the infrastructure doesn't it? Sky is not an internet company so would have to lease bandwidth to serve the content?

darylblake

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#1554693 18-May-2016 11:11

MikeB4:

Sky is still making money, their total assets are circa $1.9 Billion and for Fiscal 2015 they returned a Net profit of $170 million.

Obviously not enough to stop them from increasing the price of the service.

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