Market Insight

Australian broadcaster unveils new OTT service

November 22, 2017

David Scott David Scott Associate Director – Research and Analysis, Service Providers & Platforms

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  • Seven Network launches new Australian OTT service 7plus in November 2017.
  • 7plus is wholly-owned and operated by Seven and replaces the PLUS7 service.
  • New service takes Seven's content beyond broadcast TV.

Australian commercial free-to-air TV broadcaster Seven Network will launch 7plus, its new over-the-top (OTT) digital video streaming service in November 2017. 7plus will feature exclusive original commissions in addition to live and on demand content.

7plus follows the PLUS7 catch up TV and video-on-demand (VoD) service operating since January 2010. The PLUS7 service was run by Seven through its Yahoo7 joint venture. The emergence of 7plus comes after Verizon Communications acquired Yahoo! in June 2017. As a result, the new 7plus service is a wholly-owned and operated standalone service by Seven which replaces PLUS7. 

Our analysis

7plus will take Seven’s content beyond broadcast TV and help the company capture more consumers and advertisers which will ultimately strengthen revenue for parent company Seven West Media (SWM). Consolidated revenues for SWM declined 2.8% to almost A$1.7 billion in the financial year ending 30 June 2017. SWM will hope 7plus drives further growth in the divisional performance of its television business in 2018, following its 1.0% increase in revenue to A$1.2 billion over the same period. Seven competes for ad revenues against two other private commercial TV groups, Nine and Ten, as well as global media giants such as Facebook and Google.

The increasingly crowded Australian OTT space will require 7plus to deliver on content, innovation and engagement to succeed. 7Plus will benefit from Seven’s vast library of content including popular local programmes such as Home and Away, My Kitchen Rules and House Rules. In addition, Australians love of sport will drive viewers to the service given Seven holds broadcast rights to major events including Australian Football League (AFL) matches, the Melbourne Cup, the Rugby League World Cup, the Australian Open, the Olympic Winter Games and the Commonwealth Games. Seven’s content amassed 1.8 billion streaming minutes in fiscal 2017 bolstered by the Olympic Summer Games and Australian Open tennis.    

Seven faces formidable competition from global TV and movie streaming leader Netflix, which launched its service in Australia in March 2015 and continues to strengthen its subscriber base following a sharp rise in subscribers in the first half of 2017. Netflix is also looking to deliver on original content having commissioned its first Australian original series Tidelands in 2017. IHS Markit forecast Netflix’s subscriber base to reach nearly 3.6 million by the end of 2017. In addition, home-grown OTT service Stan has found favour with local audiences on the back of its original content. Stan has produced Australian original TV series Wolf Creek, two seasons of No Activity and Plonk, stand-up comedy series One Night Stan and has a feature film, The Second, in the works which will first debut in cinemas prior to its streaming service. Stan also has four new original series in development, namely The Other Guy, Merchants of Misery, All Thumbs and Chaperones. Netflix and Stan have recently been joined by Amazon Price Video and the newly relaunched Foxtel Now, formerly Foxtel Play. 

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