Market Insight

Sky Italia launches IP-VoD service

July 01, 2012

Fateha Begum Fateha Begum Associate Director, Connected Devices & Media Consumption

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Italian satellite TV operator Sky Italia is to launch its IP-VoD service, Sky on Demand, in July.

For now, the service will only be available to those who have had a Sky subscription for more than a year and have a 'My Sky HD' set-top box. From 1 November 2012, all customers with a 'My Sky HD' set-top box, regardless of how long they have been a subscriber, will be able to receive Sky on Demand.

The hybrid service will deliver on-demand content to the set-top box using a progressive download system. Users are required to connect their HD set-top box to the internet via Ethernet connection or Wi-Fi.

Eligible customers will be able to access a range of Sky programmes on-demand for free for no additional cost. More than 1,200 titles will be made available at launch with this expected to increase to more than 2,000 titles over the next few months. The on-demand catalogue will comprise movies, TV series, children's content, sports and more.

The launch of IP-VoD services by Sky Italia has been long expected. News Corporation-owned BSkyB and Sky Deutschland also launched IP-VoD services in the past year. The use of IP-VoD delivery systems allows Sky Italia to offer a wider range of on-demand content and higher convenience to the user in comparison to traditional near-VoD services.

Approximately 1.8m Sky Italia homes have access to the HD DVR 'My Sky HD'. However, it is unclear what proportion of these households have been Sky Italia subscribers for more than a year. The operator saw annual net additions of 145,000 since Q1 2011 in its total subscriber base, with just more than 1.1m additional subscribers taking My Sky HD since Q1 2011.

Video-on-demand services are not prevalent in Italy, particularly when compared to other Western European markets. Sky Italia has the largest proportion of the TV market share in Italy after free DTT services, with a total TV household penetration of 22 per cent at year-end 2011.

Sky Italia recently launched Sky Go, allowing Sky HD subscribers to view a selection of Sky programmes on the PC, tablet and iPhone for free. The move to offer on-demand services is another move by the operator in a bid to increase value to customers and reduce churn. More than EUR 9bn has been invested in Italy by Sky, in addition to €100m in technology each year.

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