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BSkyB Bowing Digital Movie Store

21 Mar, 2014 By: Erik Gruenwedel

Sky Store selling digital movies

U.K. satellite operator borrowing page from Comcast's digital sellthrough playbook

British Sky Broadcasting Group, the satellite TV operator in the United Kingdom, is readying an electronic movie sellthrough option for its Sky Store transactional VOD platform, CFO Andrew Griffith said at a media event.

The “buy and keep” option (which hasn’t disclosed pricing) mirrors Comcast’s recent launch of a digital movie store in the United States — the first for a cable operator. Sky’s digital storefront aims to target pay-TV subscribers who typically opt for packaged media when seeking to own new-release movies. Sky Store heretofore only rented new-release and catalog movies.

While sales of DVD and Blu-ray Disc movies in the U.K. are declining, packaged media still dominates home entertainment spending — at about £1.4 billion ($848 million) in 2013, according to IHS. Revenue from digital sales and subscription streaming increased 40% to £621 million ($376 million). The uptick helped the British home entertainment industry realize its first annual revenue gain in five years.

"Having made a strong start in rentals, we think we can go one step further and actually start offering customers the opportunity to purchase movies from us and keep them forever," Griffith told attendees March 18 at The Guardian Changing Media Summit in London. "We think we are extremely well-positioned to enter the market and take share."

Indeed, Sky, which has more than 10 million pay-TV subscribers — 38% of the U.K. market — is also upgrading its interactive menu guide to help subscribers find movies and purchase them.

"It's a big market to go after. If you are going to target a big chunk of a £1.4 billion [disc] marketplace, then we'd expect it to be a material opportunity,” Griffith said.

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