Sky entered the broadband market with a 900 Mbps UFB fiber plan of unlimited data at $ 79 per month. Video / Sky NZ

Sky is offering one year of free access to Disney + to anyone who signs up for at least 12 months to its new broadband service.

Following a recent price increase, the Disney + streaming service costs $ 12.99 per month or $ 129.99 (a 15% savings) if you pay a year in advance.

Sky Broadband offers a UFB fiber plan with 900 Mbps of unlimited data for a very competitive price (for this speed) of $ 79 per month.

The Disney + offer will be available to any eligible customer who subscribes to Sky Broadband before May 31, 2022 and is a new or former Disney + subscriber.

All customers who have already signed up for Sky Broadband will also be offered 12 months of free Disney +. This should attract goodwill from Sky. 2degrees snubbed existing customers when it introduced a similar 12-month promotion involving Amazon’s Prime Video at $ 8.99 per month.

The Disney + offer is also exclusive to Sky Broadband; a contrast to Netflix which has run numerous promotions with the major ISPs.

The deal also marks another change in the relationship between Sky and Disney +.

At the end of 2019, as it launched its new global streaming service, Disney pulled its channels from Sky TV and other pay-TV operators around the world.

But lately, they have become closer again with Sky customers having access to the ESPN + streaming service (ESPN is 80% owned by Disney, 20% by Hearst Communications); Disney-owned Hulu content now appearing on Sky’s Neon after Sky’s purchase of Spark’s Lightbox) and the new Disney + promo.

Direct-to-consumer apps – which are cutting out both old-school middlemen like Sky and new-school aggregators like Netflix – have been around for some time, but have really taken off in the last 18 months and gained momentum in 2020.

Disney saw all of its big three streaming services, Disney +, Hulu and ESPN +, add up to 142 million subscribers worldwide and $ 3.5 billion in revenue earlier this year.

The runaway success of Disney + has sparked a wave of direct-to-consumer imitators, including Discovery +, HBO Max, and Paramount +.

But like Netflix, Disney + has seen its streaming growth slow in its final quarter as Covid restrictions relax in many countries.

Yet global streaming services are now far more important than any traditional broadcaster – and they just keep getting bigger.

Disney + The Mandalorian series.  Photo / Disney.
Disney + The Mandalorian series. Photo / Disney.

Disney + added “only” 8.7 million new subscribers in the March quarter for a new total of 103.6 million subscribers worldwide (analysts expected 110 million).

Elsewhere in the Disney empire, Hulu had 42 million subscribers at the end of the March quarter and ESPN + 14 million subscribers. While Hulu has grown by a third in the past year and ESPN + by 75 percent, they also saw growth in the three months leading up to March 31.

Despite the slowdown in growth, Disney says Disney + is on track to reach between 230 and 260 million subscribers by 2024.

In contrast, Netflix recently reported 208 million subscribers.

Amazon has 204 million subscribers to its Prime service, which includes merchandise delivery, audio, and video, but does not regularly publish video streaming numbers.

Last month, Amazon announced that it would buy MGM Studios for $ 9 billion ($ 12.5 billion) in an effort to increase the content of its Prime Video service. Prime will also air Amazon’s billion-dollar Lord of the Rings series, currently filming in West Auckland, and Amazon recently gave the green light to seven original Prime series to be shot across Tasman.

Why Sky Broadband?

Some analysts have questioned whether it is worthwhile for Sky to enter the crowded, low-margin broadband market. Others saw the potential of the new service to be used as leverage to retain customers or help attract new ones. Sky’s first broadband offer certainly leans heavily in the direction of reducing the churn rate. Your $ 79 broadband bill drops to $ 109 per month if you drop Sky Starter.

Another argument is that the more services you have with a single provider, the more complicated it becomes to switch to a competitor – hence the craze for utilities to bundle broadband. The advent of UFB fiber – whose simpler infrastructure means it is much easier for a customer to be moved between retail ISPs – has supported the fashion.

Former Sky TV chief executive Martin Stewart was in favor of a large telecom piece, with his company dealing directly with Chorus. He also said that a Sky mobile phone service was “only a matter of time”.

Under the leadership of new CEO Sophie Moloney, the mobile ambition has been quietly sidelined, and Vocus (owner of Orcon, Slingshot and Flip) has been brought in as a middleman – cutting costs and risks, everything by reducing margins.

Vocus operated the first iteration of the broadband service known as Stuff Fiber (later run by Vibe) when it first went live in 2016. Stuff Fiber garnered a modest 20,000 customers before being sold to Vocus in 2020.

Sky declined to comment on the number of Sky Broadband subscribers so far.

Shares of the company closed yesterday at 16.9c. The stock is down 8.65% for the year.

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This notice was published: 2021-06-08 21:30:00


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