news National broadband provider iiNet today revealed that it had so far only signed up 10,000 customers to the FetchTV platform it launched in mid-2010, representing only a tiny success rate in converting its 824,000 ADSL broadband customers to the system.
FetchTV is a set-top box-based Internet television service which was first launched in mid-2010 through iiNet’s network, followed after by other companies such as Adam Internet and Internode. In September 2011 Optus also launched the platform, which is developed by the independent company of the same name.
Like rival platforms such as Telstra’s T-Box initiative, FetchTV provides a variety of functions to users. It can record and play back live television, and it also provides a number of streaming television channels to users, as well as TV shows and movies on demand, which can be paid for on an ad-hoc basis. The system also comes with a number of movies provides free to users and refreshed regularly.
When the platform was launched, customer interest in FetchTV was strong, with positive media reports written about the initiative and a number of ISPs expressing immediate interest in the platform. However, in its annual financial results session today, iiNet appeared to reveal it had only 19,000 FetchTV customers. iiNet chief executive Michael Malone later clarified that only 10,000 of those customers were on the FetchTV platform, with the rest being customers on the existing IPTV network of iiNet acquisition TransACT in Canberra.
Delimiter’s review of FetchTV in March this year found the platform was promising by flawed.
“Alongside Quickflix’s fledgling IPTV service, Telstra’s rival T-Box platform and hybrid streaming services available through Microsoft’s Xbox 360 and Sony’s PlayStation 3,” the review stated, “FetchTV remains one of the only decent options open to Australians for getting legal video on demand and IPTV content into your home and onto their television screens. Out of that batch, FetchTV is likely close to being the front-runner platform, due to the breadth of content it has available and the integrated nature of its set-top box, as well as its broad ISP support.”
“However, the service is far from mature. On a technical basis it still has a number of medium-level bugs, which are not show-stoppers but are annoying. And it’s biggest issue remains the availability of content through the platform. Put simply, when browsing the service, many people will find it hard to find any content they actually want to watch, rather that simply tolerating if they are really bored. There is some great content available — but you’ll usually pay more for it when you find it.”
“FetchTV is continually improving its service, and we think that in several years it may become a powerful and complete system. But it’s not there yet.”
Other IPTV players in the Australian have traditionally struggled to attract substantial customers, as FetchTV has with iiNet. Perhaps the standout success is Telstra’s T-Box platform, which is similar to FetchTV. In late March, Telstra revealed that it had provided more than 300,000 units of the T-Box to customers. The platform is bundled to customers on a much cheaper basis than FetchTV.
Malone did not immediately respond to a request for comment on the future of the FetchTV service with iiNet. Separately, the company announced strongly positive financial results today (PDF), with revenue up 19 percent over the past 12 months to $831 million, and net profits and earnings also up substantially. “Our scale, combined with our culture of service and product leadership have provided the foundations for our growth,” said Malone in a media release today. “These attributes place us in a unique position to continue growing in an evolving market for telecommunications services in Australia.”
I remember having several huge arguments with iiNet and FetchTV over the IPTV platform. On one memorable occasion, at an iiNet press briefing in 2010, I got into a huge argument with the company’s then-chief technology officer Greg Bader about whether FetchTV would take off and even made a bet of some kind about it (I can’t remember what the precise terms were). Similarly, I remember a few tense conversations with FetchTV chief executive Scott Lorson.
My frustration with FetchTV has always been that it provided a service which people fundamentally didn’t want. What Australians have always wanted from IPTV boxes is to be able to instantly download whatever TV shows and movies they wanted (specific titles) at a competitive price. What FetchTV provides Australians with is a service with a bunch of largely mediocre content paid for with top dollar. The difference, when you’re trying to find something decent to watch, is subtle yet profound. And as I wrote in 2010, iiNet launched FetchTV at a price three times that of Telstra’s T-Box. Little wonder nobody took it up.
The argument which has always been presented to me was that FetchTV was a service which would rival pay TV services Foxtel and Austar, but at a much more competitive price, and with some bells and whistles removed. My counter-argument to that was that nobody I knew (I’m 31 years of age) was signing up for pay TV now — so why would they sign up for FetchTV, given it had crappier content and wasn’t that much cheaper? Unfortunately for iiNet and FetchTV, it looks like I was right.
Today, I call for iiNet to back away from the failed FetchTV experiment and look elsewhere for its content bundling options. The company which has been really successful with this model internationally is Netflix; perhaps iiNet could look to bring Netflix (finally) to Australia. Or perhaps it could partner with local Netflix wannabe Quickflix. But whatever it does, it needs to make a decision on FetchTV quickly; because this is one stinker which is rotting on the vine.
Image credit: fetchtv