Australia’s SVOD market consolidates; Presto closing, Quickflix sold

By Jim O'Neill on Oct 04 2016 at 8:30 AM

Another SVOD service that launched to go toe-to-toe with Netflix is shutting down, the victim of an extraordinarily competitive Australian video market. Presto, the JV between free-to-air broadcaster Seven West Media and Foxtel, News Corp.’s pay-TV group had an estimated 200,000 paying subs and was a distant third to Netflix, which has about 1.9 million subscribers in Australia. Both launched about a year and a half ago. Foxtel plans to absorb Presto and, hopefully, its subscriber base, before closing the books on it for good Jan. 31.

Seven West’s CEO and MD Tim Worner said his company will work with Foxtel moving forward “in the creation of new programming content.”

Foxtel CEO Peter Tonagh, meanwhile, said Foxtel Play will be a "simpler, cheaper and more flexible IP delivered product” that “will create much better value for Australian consumers.”

“It is the logical step for us to take in the evolution of Foxtel’s service,” he said. “The new offering will mirror the successful launch of HBO Now in the U.S. and Now TV by Sky in the U.K.”

Foxtel Play’s structure, however, looks far more like Cloud TV play Sling TV than HBO Now, offering five entry-level tiers, including two options for drama priced at A$15/mo. each or A$25 for both. The service also is offering add-ons, a la Sling TV, For A$10/mo., including content in the individual buckets of Lifestyle, Documentary and Kids. Live sports will cost A$25/mo., and a Movie tier A$20/mo.

The package gives subscribers access to all linear channels in the tier along with all of the on-demand, catch up and library content.

Finally, an out for Quickflix?

Quickflix, which was the first streamer to launch in Australia after years as a DVD-by-mail service, has been purchased by U.S.-based Karma Media Holdings, which is headed by entrepreneur Erik Pence. The deal includes the long-struggling hybrid-video company’s streaming operation and its DVD catalog.

Karma says it will make A$700,000 available to keep Quickflix open for the time being.

From a statement about the deal, Joint voluntary administrator, Jason Tracy said:

“Quickflix has encountered corporate challenges and impediments in a highly competitive environment… The result is a good outcome for stakeholders. Under new control, the Quickflix business will continue to trade, 24 employees will be retained, departing or already departed employees will receive all relevant entitlements, creditors will get a return and suppliers will have the option of trading with the continuing business.”

Netflix killers facing a tougher go than they imagined

Presto joins Canadian streaming service shomi as the latest casualty among streaming services created to block Netflix’s emergence in new markets. Shomi, a JV between Canadian cableco Rogers Communications and Shaw Communications last week announced it was shutting down after being unable to gain traction in the market.

Stay tuned.

Follow me on Twitter @JimONeillMedia and on LinkedIn

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