On Cusp Of Web TV Revolution, Sky Soft-Launches A Conventional VOD Service

BSkyB (NYSE: BSY) will finally enable its true, pull-VOD service, Sky Anytime+, for its TV subscribers on Tuesday, allowing customers to call up on-demand programmes to Sky+HD boxes via a broadband cable to the rear.

Until now, viewers either had to schedule their own recordings with the Sky+ PVR or accept the selection of shows Sky beamed to their box via Sky Anytime.

The service is available only over Sky Broadband, for free, and it’s thought Sky will offer a widget to bridge the gap between customers’ router and their set top box.

Sky isn’t detailing the ful roster of programming for which it has on-demand rights, but says it’s “thousands of hours” of TV from its own and third-party channels plus Sky Movies’ full catalogue of 600 films. Answering an analyst who said “It’s a very similar offering to what we have already on the market,” CEO Jeremy Darroch said on Friday: “It is a starting point – you’ve got to get going somewhere.”

But, at a time when internet-TV innovation is kicking off with YouView and TV makers promising not just VOD but all manner of internet widgets and bells and whistles, Sky is notably eschewing the latter, concentrating on a basic proposition of conventional TV shows, delivered on-demand. That sort of gets it to where Virgin Media (NSDQ: VMED) has been for some time in on-demand, albeit with a superior EPG UI…

Virgin, too, is planning to introduce web services via a new box built by TiVo (NSDQ: TIVO), but don’t expect such things on Sky’s box any time soon – as borne out by HD, 3D and Sky Anytime+, it’s on television that Sky is innovating.

Darroch, when asked about new services like YouView: “These new distribution platforms will be a challenge at one level – just as Freeview was… but it didn’t prevent us going well and hitting our own goals. Potentially, it might be an opportunity in terms of our content, we’ll have to see. The core choice people face in the marketplace is one of pay versus free – that isn’t really changing.”

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In the three months to September 30, Sky hit 9.956 million customers, on the cusp of that 10 million mark as News Corp.’s offer for the company continues lingering. And bundling is going great guns – 2.3 million people take all three services (TV, broadband and phone); that’s up 39 percent from last year.

Operating profit grew 25 percent to £255 ($401.49) million on 15 percent higher revenue of £1.52 ($2.4) billion. Most impressively, Sky has hit a record for the money it pulled from customers – £514 ($809.28) per year.

In Friday’s earnings, Sky says: “We are now the leading media provider in the UK on mobile and tablet platforms, with over 7.5 million Sky apps downloaded on iPhone, iPod touch and iPad.”

Sky’s income from advertising has rocketed 46 percent to £102 ($160.6) million after it bought the Living TV group.

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