Sky to shift iSky capabilities to TV sets

Sky Television's internet-based iSky service will be available on every MySky decoder within 12 months, it says, making it easier for subscribers to access on-demand content on their television sets.

During a briefing on Sky's 9 per cent increase in half-year net profit yesterday, chief executive John Fellet said subscribers would have access to "thousands of additional viewing options" on their flatscreens.

Fellet said iSky, which was introduced in 2010 for viewers who wanted to watch their Sky service online when and where it was convenient, was the fastest-growing segment of Sky's business.

"Media download requests" on iSky had grown 26.9 per cent in the half to almost 1.9 million.

However, the real value of iSky was the ability to view movies and other content on demand, and transferring this to the television would draw more subscribers to the MySky service, Fellet said.

Subscribers would be able to download the software upgrade directly to their MySky box.

Sky already has channels of "scheduled" on demand movies as well as the ability to download movies via satellite.

However, broadband transmission would make the system more interactive and responsive.

Craigs Investment Partners analyst Arie Dekker said shifting iSky's capabilities to the TV set would increase the attraction of MySky for potential subscribers.

The change was likely to go more smoothly than Sky's Igloo joint venture with TVNZ, which was delayed by seven months for technical reasons, because such decoder upgrades had been successful in other parts of major owner News Limited's global stable, he said.

Fellet also presented a graph showing the net gain of monthly overall Sky subscriptions down to about 1000 per month in December compared with at least 5000 in the same month for the past five years.

Fellet put the low net gain figure down to a bumper year for Sky subscriptions last financial year, which included both the Rugby World Cup and the London Olympics.

People had brought forward their decision to buy Sky, resulting in a correlating drop in new subscriptions the following year, and the general economic environment had not helped, he said.

"When we only had 20 per cent penetration we never felt recessions at all but now that we supply TV to over half the families in New Zealand, when a meat-packing plant in the South Island closes we see it in our numbers a few weeks later," he said.

Those subscribers who had joined and stayed - now totalling 846,988 residential and commercial premises, including Igloo - were upgrading their services like never before.

A 3.9 per cent increase in overall revenue resulted from a 5.5 per cent increase in average revenue per user [ARPU] from $71.81 to $75.78 - an increase not seen since a 6 per cent jump in 2009 when MySky's high definition service was introduced.

The increase in ARPU reflected customers upgrading to MySky and Multi Room, and picking up premium channels such as SoHo.

Fellet said SoHo's performance had been pleasing but he would not give exact subscriber numbers for the exclusive entertainment channel.

The launch of discount pay TV box Igloo in a joint venture with TVNZ was a load off Fellet's mind, including the source of Igloo customers which he believed were FreeView customers upgrading rather than Sky customers downgrading.

Fellet gave an upgraded profit guidance for the full year of between $125 million and $130m, up from between $120m and $125m because of increased earnings and a "holding off" of capital expenditure programmes.

The Dominion Post