Foxtel Triple Play Broadband is coming
Unlike some telcos who prefer not to get into NBN, Foxtel preferred to venture into this new technology.
Foxtel has already done many things to face the treat that NBN poses to broadband. Recently, it has offered its customers Internet-based video services which can be accessed through different devices. This is to meet the demand of homes who no longer want to have traditional pay TV service. Foxtel knows that the times are changing. In the US, many of the so-called “cable cutters” are abandoning traditional television in large numbers. Here in Australia, even though television ratings are still high and we’re several years behind the US, it’s also just a matter of time when this new technology takes over traditional TV.
Foxtel Triple Play
Foxtel is now planning to further expand its operations next year by becoming an Internet Service Provider. Everybody can now sign up for Foxtel broadband on the NBN or through Telstra Wholesale. However, people can’t sign up to its services through HFC Cable. For people who aren’t fond of having Foxtel in their homes, they may find it hard to imagine that this Pay TV giant will now become an ISP. However, people who like subscribing to Foxtel’s services, it can also be a good idea for them to subscribe to its broadband services in the future. It’s just a matter of whether Foxtel can offer to them the plans and bundles which they are looking for.
There’s always been a close relationship between Telstra and Foxtel because Telstra has a fifty percent stake at Foxtel. A wide range of Foxtel bundled deals are offered by Telstra. This includes combining your home phone, mobile phone, Pay TV and broadband in just one bill. In order to lure some of Telstra’s customers, Foxtel must at least match the things that are offered in these deals. Optus and Telstra customers are the likely targets of Foxtel because they can be easily be attracted to better prices and bundles. Broadband customers who have higher standards have long abandoned Optus and Telstra many years ago to get other benefits like a better customer service.
In order to compete with Telstra and Optus, Foxtel plans to offer the “triple play” of home phone, Pay TV and broadband services. Some existing customers of Optus are still paying for Foxtel on their bill even though this company doesn’t offer Foxtel Pay TV bundles to its new subscribers. Today, Foxtel still have no plans to become a mobile phone or a broadband reseller. This is a very important point to consider. Telstra and Optus might be more focused on mobile services next year so that their customers would not think of switching to Foxtel.
Foxtel is still expected to pay the same wholesale broadband price like any other Telstra DSL resellers even though it has a close relationship to Telstra. Foxtel will also be paying the same access fees to NBN just like any other company. But unlike other companies, Foxtel can afford to offer lower broadband prices in the hope that it can make up for the lost profits in other areas. It will be interesting to see what ACCC will do in a situation like this. I don’t think this consumer watchdog will do something that will really benefit consumers in this situation.
Foxtel is not likely to become a progressive ISP like Intermode or iiNet even if it pursues an aggressive price bundling strategy. It might tempt some Fetch TV users to switch ISPs if it does a strategy like this. However, people particularly those who have avoided the likes of Telstra and Optus will not be attracted to its service.
Telstra’s unlimited access to Foxtel content like Foxtel on Xbox 360 and Foxtel Play should be matched by Foxtel in order for it to stay competitive. It will be interesting to see if the needs of telstra customers who want to switch to Foxtel as their ISP will be met. Remember that Telstra offered Telstra products to its customers in order to discourage them from leaving Telstra when a better deal becomes available. It will be good for Foxtel if they can offer discounts to former Telstra customers who are looking to upgrade to another Foxtel box in their home.
Foxtel customers prefer to use its download and streaming services rather than third-party video services or BitTorrent. These services account for a huge percentage of their monthly downloads. Foxtel will not be under pressure to offer monthly download limits if its downloads have no limits. But this company is unlikely to offer unlimited plans to customers. Foxtel plans will be all about triple play, and its Internet plans might not even be a great deal for some consumers.
Foxtel shouldn’t have gone to too much trouble stealing Telstra’s and Optus’s customers if it can offer the right plans and bundles to consumers. Its customers might not switch to NBN in the future if Foxtel can provide them more online video services. The Pay TV giant is still very determined to keep its dominant position in Australia’s living rooms even if the new government’s Fibre to the Node plans could reduce NBN’s short-term threat to Foxtel.
What would make you switch to Foxtel as your ISP?