Story image

Lightbox drops price on Netflix launch, 2degrees may need online TV too

25 Mar 15

Spark's online television service Lightbox has responded to tomorrow's arrival of newcomer Netflix in the New Zealand market by dropping its monthly pricing from $15 to $12.99 for new and existing customers immediately.

The move brings its pricing into line with rival Quickflix, well under Sky's Neon pricing at $20 a month, but still above the US-based Netflix, which confirmed this morning it would charge $9.99 per month when it kicks off tomorrow. Spark also offers Lightbox free to its 600,000 or so broadband customers for 12 months.

Lightbox chief executive Kym Niblock said the TV service intends being at the forefront in its category.

"It's always been our strategy to be competitive in this developing market by offering New Zealanders lots more choice."

Niblock said its line-up of shows had expanded since it launched last year and it's also announced a sports partnership with Coliseum.

Telco market commentators say customers are now looking for one provider for mobile, fixed line phone, and internet, and potentially subscription online video content as well.

That may create a further challenge for 2degrees, the third placed mobile carrier, which announced today it was buying Christchurch-based internet service provider Snap for an undisclosed amount that will see Snap owner Mark Petrie take a shareholding in 2degrees and take charge of the operator's fixed line services.

The country's challenger mobile brand wants to enter the landline market and decided its best option was buying Snap, which has already built a nationwide network that could easily scale up.

Both Telecommunication Users Association chief executive Craig Young and IDC telco analyst Peter Wise say 2degrees may also need to match its competitors.

"They'll have to come up with something. Maybe Quicklfix is an option or developing something themselves, though that would be difficult," Wise said.

Deutsche Bank telco analyst Adrian Allbon said in a research note out this afternoon that 2degrees' acquisition makes sense for the mobile operator as global trends point to "convergence across fixed, mobile and more recently internet protocol television becoming an increasingly important feature as companies look to build scale in an industry which demands continual capital investment and reinvestment."

Over the next year Allbon said he expected 2degrees to launch combined fixed and mobile offers for the business market and use its larger mobile base (around 23 percent by customer) to bundle fixed line products for the retail market.

He said it will add to the competition Spark currently faces in its home, mobile and business division and to a lesser extent, digital, but only at the margins because 2degrees will "no doubt have residual capital constraints and will also consolidate some of the marketplace which is currently across other and/or regional players."

The purchase is likely to be positive for Chorus as it could increase ultra-fast broadband uptake, he said.

Kiwis losing $24.7mil to scam calls every year
The losses are almost five times higher compared to the same period last year, from reported losses alone.
Tile's Mate & Pro Bluetooth trackers land in NZ
If your car keys (or your tablet) have disappeared into the void at the back of the couch or if you left them somewhere in your car, retracing your steps to find them could be a thing of the past.
Government still stuck in the past? Not on GovTech's watch
What exactly is GovTech and what’s been happening in our capital city?
"Is this for real?" The reality of fraud against New Zealanders
Is this for real? More often than not these days it can be hard to tell, and it’s okay to be a bit suspicious, especially when it comes to fraud.
Hands-on review: The iPhone Xs
The iPhone Xs is a win that brought numerous new and exciting features to the market.
How much does your Amazon Prime Video subscription really get you?
For our NZ$8.90 per month, the average cost per title is US$0.00126 - but we only really get a choice of 416 TV shows and 4321 movies. Choice is a little bit limited compared to other countries.
Three ways to improve mental health support in the workplace
“Instead of scrambling into action after a crisis, employers need to be more proactive in supporting employees."
Kordia launches Women in Tech scholarship at the University of Waikato
The scholarship is established to acknowledge and support up-and-coming female talent and future technology leaders.