Foxtel to launch triple-play

Australia’s dominant pay TV platform Foxtel will package its TV channels with broadband internet and fixed-line telephone services in a bid to boost its penetration of households from 30%.

The triple-play offering will start late next year. The launch date and pricing are yet to be revealed.

The bundling is designed to enable Foxtel to capitalise on the roll-out of the federal government-funded National Broadband Network while signing up new subscribers and lowering the churn rate, which was 14.2% in the year to June 30. Foxtel had 2.5 million customers.

Foxtel’s major challenge, according to industry executives, will be to come up with a pricing structure that is competitive with its ISP competitors and does not cannibalise 50% shareholder Telstra’s VoD service BigPond Movies and IPTV service T-Box.

ISP iiNet has just introduced a broadband/home phone package bundled with Fetch TV’s channels for A$89.85 (USS81.77) per month and Optus has a similar deal for A$79.90. Fetch TV’s offerings include movies to rent from all major studios, 30 free movies per month, PVR, ABC iview and SBS Catch Up.

By contrast, Foxtel’s average revenue per user (ARPU) is A$103.

The bundling initiative had been long mooted but the Foxtel board, repping Telstra and News Corp, has just signed off on a wholesale agreement with Telstra.

“This is a transformative event for the Foxtel business,” said CEO Richard Freudenstein. “It will enable us to greatly enhance the breadth, quality and value of the services we offer to customers while opening up significant opportunities for growth. International experience demonstrates that triple-play and broadband bundles have been hugely popular with consumers and have allowed operators to boost take-up of subscription TV services.

“Broadband and telephony will be a tremendous complement to the traditional Foxtel service. These new services will join our continually expanding offering, which includes highly flexible IP products – Foxtel Play, Foxtel Go, and the brand new online and on-demand movie service Presto.”

Separately, Foxtel has just added Nickelodeon, Nick Jr, MTV, ESPN and ESPN2 to its mobile service Foxtel Go.

On January 1 Syfy, TVH!TS and the Universal Channel will be added to the main linear service and to Foxtel Go, which will bring the number of live channels available on Foxtel Go to 68.