SYDNEY — Australia’s dominant telco Telstra plans to launch a video-on-demand service enabling customers to download Hollywood movies to their PCs.
Telstra’s Big Pond Movies is expected to offer the same films that are available on its Foxtel Boxoffice, the paybox that airs pics every 30 minutes on pay-per-view.
As Telstra owns 50% of Foxtel, some pay TV execs wonder why the telco is competing with itself — and why U.S. studios would jeopardize the hefty profits they rake in from Hollywood-owned pay movie channels Showtime and the Movie Network to make extra bucks from VOD.
“We’re not competing: our service will be complementary,” says Telstra corporate affairs manager Craig Middleton.
He says the service will launch before June. Telstra has signed deals with some suppliers and others are in negotiation but Middleton declined to be specific.
One U.S. major rep who’s haggling with Telstra sees Big Pond Movies as a new source of revenue that will grow the pay TV category, but concedes some dollars may shift between platforms.
Some studios are keen to see Telstra offer a subscription-based VOD service, which would allow them to funnel older films and other content through it.
Telstra launched Big Pond Movies a year ago. Like Netflix Stateside, it allows customers to rent DVDs online with free postal delivery and return.
Its library has 13,500 titles, compared with 2,000 at the typical video store.
It has logged more than 2 million transactions with the 10 most popular titles dominated by quirky pics including “Kill Bill Vo1. 1,” “Lost in Translation” and “Big Fish.”
One pay TV exec thinks the VOD service will tap into consumers who rent videos but don’t think it’s worth paying around $75 per month to subscribe to Foxtel or other feevee platforms.