Telstra Look To Mimic Netflix Subscription Service

Written by David Richards     07/04/2011 | 01:22 | Category: INDUSTRY

The head of Telstra's BigPond TV operation, has said that the ideal entertainment delivery model for Australia is similar to what Netflix is doing in the USA, with some insiders tipping that Telstra will eventually launch a one stop subscription service for movies, music and other TV content.

Speaking at yesterday's launch of Samsung's new TV portfolio, Ben Kinealy also said that Telstra was currently talking to several manufacturers of consumer electronics goods with a view to having Telstra's BigPond TV software installed on devices such as Blu ray players, set top boxes, flat panel TVs and home theatre receivers, a move that will allow Telstra to rapidly expand their Big Pond content services in Australia.

Currently Netflix offers both on-demand video streaming over the internet, and flat rate online video rentals. The service can be accessed on a TV, PC, Smartphone and Tablet.

Kinealy, who has just returned from a major content conference in London, said "The model for Australia is similar to what Netflix is doing overseas. We, Telstra, are in an excellent position to compete in Australia as we are currently expanding our software offering to include such services such as our AFL game analyser which allows consumers to access game videos and other information 12 months of the year".

Kinealy would not say whether Telstra has approached Netflix to partner with them in Australia.

Recently Netflix said that they are interested in expanding their operation into "foreign markets" like Australia after a successful trial in Canada.

Netflix CEO Reed Hastings said in response to the launch of a new "pay per view" service by Amazon that the future model for content is a "subscription" model. 

Hastings says it's "very, very unlikely" that Netflix will get into the pay-per-view market.

"We're focused on the subscription model of 'Unlimited' for a flat fee. That simple proposition, he claims, is about brand clarity, and that for $7.99 per month the company can deliver unlimited streaming.

"That's what we really want to focus on and we think that's the optimal strategy. Rather than try to get into every possible thing that our subscribers also want, like should we sell DVDs? Should we sell hardware?, etc etc." he said.

Hastings also shot down the idea of a tiered pricing plan that would give users access to different kinds of content depending on how much they pay each month.

SmartHouse understands that Telstra may move away from the T Box model in the future to a subscription model a move that will allow them to focus on delivering content via a software application, with hardware manufacturers taking responsibility for the evolution of their products.

A key partner of Telstra's BigPond TV service is Samsung who yesterday announced 41 new TVs with over half offering "smart" TV capability.

The new Smart TVs  offer an "All Search" function which searches home network devices, Facebook, Google and video-on-demand services. Samsung has also introduced a new Social TV app which lets you view Twitter, Facebook and Google Talk in a sidebar - while watching TV.

"Smart TV is the death of the so-called 'idiot box'", said Brad Wright, Samsung's group product manager of consumer electronics.

BigPond Movies and BigPond TV are new additions to the 2011 line which enables movies-on-demand as well as "live" channels streamed via the internet.

Kinealy said that in coming months various Telstra features, would be integrated into a software application on the new Samsung Smart TV in what he described as "T Box Lite".