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TiVo plunges into Swedes after penetrating Virgin Media
Gets another pipe into the box
The announcement that Com Hem of Sweden has cut a deal with TiVo this week shows how the TiVo strategy is rolling out in Europe and points to more and more deals being likely in the future. Expect it to drift outside of Europe soon, as well.
Com Hem gives another 643,000 cable customers in Europe a chance to buy TiVo service. In Europe this includes all the DVR capability, but far more importantly the search-and-recommendation service that has positively caught fire in the UK, and which is also beginning to take off at Ono in Spain.
There will be new figures out at Virgin Media shortly, but last time out the company said that 677,000 had taken the TiVo offering, out of around 3.75 million. It has been on general availability there for just over a year, and this represents at 18 per cent penetration of its entire TV base.
If a similar uptake was seen at Ono, where there are just over 900,000 cable customers and also at Com Hem, with 643,000, this might take TiVo up by almost 280,000 TiVo sign ups over the next year, at these two partners alone, with no one knows how many more at Virgin Media. At the same time a number of other US deals will begin to yield rewards too.
The deal at Com Hem, like other TiVo deals in Europe, is exclusive, a market approach that is back in fashion ever since Apple did a five years exclusive with AT&T Mobility in the US. Com Hem is the largest cable operator in Sweden, but is also up against tough rivals in Telenor‘s Canal Digital, TeliaSonera and Modern Times Group‘s Viasat DTH service. These are all resorting to tablet and smartphone multiscreen systems and OTT delivery, as competition heats up throughout Scandinavia.
Telenor has both satellite and cable operations, but is in the process of selling off cable across Scandinavia. It had agreed to sell the Swedish cable homes, 220,000 of them, to Com Hem last June, but cancelled the deal come December, blocked by the Swedish Competition Authority (Konkurrensverket) which in our view narrowly saw this as a concentration of cable TV in Sweden, rather than a distortion of the entire pay TV market, which is its right context.
TiVo technology works with both DTH and cable, but so far in Europe, it has only cut deals with dominant cable operators in each country. Natural targets for TiVo must include Numericable in France and Kabel Deutschland in Germany, where one is dominant and the other is the largest by customer numbers. We have speculated that TiVo be used to go up against Liberty Global in each country where it launches the NDS inspired Horizon set top, as well as hitting other territories where no similar service is promised. This might see TiVo target companies like Kabel Signal and Saltzburg Kabel in Austria; Voo in Belgium; TDC or Stofa in Denmark; DNA in Finland; Ziggo in the Netherlands, GET or Telenor in Norway; Digital Cable Group in Switzerland; RCS & RDS in Romania, and Multimedia Polska in Poland. It might even win favour at Deutsche Telecom‘s TKabel in Hungary too.
All these, between them, add up to another 18 million or so targets for TiVo to shoot for in Europe, and if it did cut such deals, it would put it on a par with NDS and Liberty Global.
Where these companies are fighting Liberty Global, the need to move to a search and recommendation interface and to offer multiscreen, will make TiVo one of the only games in town on cable; while in other, non-Liberty markets this could lead to a surge in subscribers, as it has at Virgin.
TiVo has virtually single-handedly turned around Virgin Media‘s fortunes since its launch there, primarily by reducing customer churn in favor of the dominant BSkyB. If it can hold off subscribers deserting to BSkyB, which owns much of its own content, and which carries major sporting events as well, then the system should be good to keep the Horizon work of Liberty Global at bay. NDS has won a few deals for its SnowFlake based UI tool apart from Liberty Global, including Zon Multimedia in Portugal, but none in Europe since the delays have become obvious on its Horizon project.
Tomas Franzén, CEO of Com Hem, said, "We reviewed a number of alternatives to find the best way to offer our customers the absolute best television experience by providing a full suite of linear television services, VoD, and broadband delivered content (including OTT/pay services) to every room and device in and out of our customers' homes. We found that TiVo, by way of its best-in-class user experience, its leading consumer feature set and rapid time to market was the most compelling answer."
Com Hem said that TiVo will be a significant part of its future plans and include features like TV Everywhere, remote recording, universal search, smart recommendations and third-party apps. Com Hem says it will have its TiVo system ready for launch in Spring 2013 and that this is the first version which will be over IPTV, which is a bit confusing, since clearly right now the company uses tuners, whether they are tuning between cable QAM channels or in VoD to an IP based DOCSIS set of channels, and as far as we can see no genuine IPTV is involved. Perhaps they just mean that a TV Everywhere system over broadband and WiFi to tablets is part of the set-up, where elsewhere it is not.
Copyright © 2012, Faultline
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