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Sky CEO: Netflix Having Little Impact

21 Apr, 2015 By: Erik Gruenwedel

British satellite TV operator said more than 500,000 people have bought a movie with DVD backup through the Sky Store ‘Buy & Keep’ platform

Netflix launched service in six European countries in 2014 following bows in the United Kingdom and Ireland in 2012. But to London-based satellite TV operator Sky, which also owns Sky Italia and Sky Deutschland, the subscription-streaming pioneer is a non-factor, according to CEO Jeremy Darroch.

Sky is owned by 21st Century Fox, which also owns 20th Century Fox.

Speaking April 21 on Sky’s fiscal call, Darroch said that despite Netflix’s reported 3.5 million subscribers in the U.K., Sky continues to compete in subscriber growth and original content.

“Netflix is directly having really little impact on us,” he said.

At the same time, rapid market evolution of over-the-top video in home entertainment prompted Darroch to acknowledge that opportunities exist throughout Sky territories to launch such initiatives.

“Yes, potentially the opportunity’s there [for OTT], particularly in the U.K. That’s one of the things we’ll start to look at. Whether that comes through, we’ll have to see,” he said.

In the meantime, Sky re-launched Now TV, a branded streaming media device manufactured by Roku that enables users to purchase access to live sports content channels without a contract. Sky said a recent Liverpool soccer match saw more than 40,000 people purchase a one-day Now TV pass. 

The CEO said combatting Netflix requires enabling subscriber access to original content across satellite operator’s European footprint. In the period, Sky Atlantic launched original Arctic police drama, “Fortitude,” starring Stanley Tucci; political drama “1992” in Italy and Swedish co-production “100 Code” in Germany.

Later this year, Sky will launch crime drama, “The Last Panther,” starring Samantha Morton, Tahar Rahim and John Hurt. The service is also the exclusive distributor of HBO’s “Game of Thrones,” which generated 1.5 million overnight viewers on its April 12 debut.

Darroch said Sky Store, which operates the “Buy & Keep” service enabling consumers to receive a DVD back-up in the mail of a digital purchase, has seen more than 500,000 consumers buy at least one movie since launching a year ago. The service generated more than 30% of all U.K. digital transactions for Oscar-nominated Gone Girl.

“Buy & Keep” last week expanded consumer access to laptops, iOS and Android portable devices and Roku, among others.

“Anyone in the U.K. will now be able to buy a movie from Sky,” Darroch said. 

Sky ended the period with 20.8 million video subscribers, compared with 19.9 million during the prior-year period.

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