Foxtel has finally come out and said that they have serious problems with their existing iQ3 set top box, with new CEO Peter Tonagh admitting that the existing box is currently being replaced by a new box with faster processors.
ChannelNews and SmartHouse were the first media publications to reveal serious problems with the Foxtel offering which was rushed to market in an effort to counter the launch of Netflix in Australia.
Addressing the issues associated with the existing STB of which there is over 150,000 dead boxes sitting in a Homebush warehouse awaiting a major upgrade, Tonagh said “What we’ve been doing is basically working through systematically each of the bugs that we’ve identified”.
“We’ve now got code that addresses a very large number of bugs within the box and providing we go through our early sign-off of that next week it’ll start rolling out within the next two weeks and progressively across the entire base and should lead to significant improvement for the people who have had bad experiences.”
“Basically, we have commissioned a new iQ3 version set-top, iQ3.5 if you like, that has all the same functionality of the existing box, but it has a processor speed which is significantly faster just with the advent of new chip sets, it’s a naturally faster box and it’s a significantly lower cost,” Foxtel chief executive Peter Tonagh told The Australian Financial Review.
The new iQ3 box will see an update to the unit’s processing speed as well as significant cost reduction to Foxtel. However, a release date has not been finalised.
“We’ll port the existing middleware, or software, across from the iQ3 to the new box. In doing that, it will perform better, just because of the high-speed processor, but it will be lower cost to us, which is obviously a good benefit.”
ChannelNews understands the Company plans to recycle the “Dead” iQ3 boxes as soon as the new processors and software are made available. What is not known at this stage is how many millions of dollars the New Corporation and Telstra owned Company have lost on the current iQ3 set top box.
Problems with the iQ3 box was one of Mr Tonagh’s key issues to address in his first 100 days in the top job at Foxtel.
Some customers have at times complained about problems such as picture and menus disappearing, frozen screens, recording problems and remote-control latency issues.
Following the rollout of the software bug fixes, over the coming weeks, Foxtel will begin an aggressive marketing push for the iQ3, which ChannelNews revealed the Company had stopped marketing earlier this year.
Mark Buckman, a former marketing executive Telstra and the Commonwealth Bank is set to lead the Foxtel’s marketing and sales functions.
“We will push harder on the broadband bundles. We haven’t yet launch Foxtel-NBN connectivity, we’re launching NBN connectivity in the new couple of months and once we do that we’ll go harder with the bundle with the iQ3 and the Foxtel Hub which is our broadband router,” Mr Tonagh told the AFR.
“The two of them are designed to work well together and we think a good opportunity for us to more aggressively push into that broadband space . We’re comfortable with our NBN launch that we’ll have attractive pricing.”
Foxtel, which had approximately 2.9 million subscribers as of March 31, is also planning to release a so-called “puck” streaming device to provide a cheaper entry point for prospective customers who may not want to pay for the high-end iQ3 box.
The new iQ3 will see the Company go head to head with the highly popular Fetch TV Mini and Mighty set top boxes that are now flying off shelves at JB Hi Fi and Harvey Norman.
It is understood that Foxtel is open to third party services being available on the puck, such as Netflix, Stan, Presto and free-to-air catch-up services, which is speculated to be manufactured by iQ3 supplier Arris the AFR said.
