Sky Q over IP service to launch in Austria and Italy

The trend for less actual figures around broadband in financial results continues and in the latest Sky financial results[1] all we can decipher on broadband figures is that fibre (FTTC) penetration in the UK is running at 33% of the Sky Broadband customer base and with 30,000 broadband additions in the latest set of results we believe the broadband customer base is around 6.2 million households. The headline news is that the Sky Q service is set to be IP based in two Sky markets and marketed as Sky Q over IP in Austria and Sky Q over fibre in Italy removing the need for a satellite dish. Of course the NOW TV services in the UK have offered IP based services and several generations of Sky set-top box have allowed on demand streaming over IP, but to move the main PVR is a significant step and in time will allow Sky to reduce costs, and while this might be reflected in cheaper Sky packages in time, the need to upgrade to better broadband packages might mean the overall basket cost on broadband, TV and telecoms for households does not really change much.

The Sky Q box with its ability to provider ultra HD is a core part of the future, but for the consumer one concern is that the box remains the property of Sky, which should avoid the age old trick of insurance costs once out of the warranty period, but does mean if you stop subscribing to Sky you have no PVR. This soft lock in is helping to reduce the churn levels among satellite TV subscribers. In other news NOW TV is going to be available on BT TV set-top boxes in early 2019, and for those wanting NOW TV and need a playback device for their TV there is the new NOW TV stick at GBP15, so a lower price point and smaller form factor than the existing already small NOW TV boxes.

We are sure people will be quick to say that the reason Sky Q over a full IP connection is not coming to the UK yet is because of a dire broadband situation, but Italy for example while at around 17% full fibre coverage in 2016 is beating the UK that is still a long way from uniform coverage, VDSL coverage 65% and no DOCSIS cable we believe, things are changing though with a Government plan for 100% superfast (30 Mbps and faster) with 70% able to access infrastructure of 100 Mbps and faster by the end of 2022 with a budget of 4 billion Euros.


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