Comcast Eyeing AVOD Service in Europe

Comcast continues forge a business strategy in the United States melding ad-supported digital distribution with legacy pay-TV. Across the Atlantic, the media company has become a major over-the-top video player in the United Kingdom, Germany and Italy.

The cabler’s $39 billion acquisition of satellite TV operator Sky included Now TV, the 7-year-old telecom with operations in the U.K., Ireland and Italy. Now TV provides standalone online TV, high-speed Internet and landline telephone services.

Now TV, which was one of Roku’s first OEM clients for streaming media devices, including USB stick technology, is the third-largest OTT video service in the U.K. behind market leader Netflix and Amazon Prime Video, according to Broadcasters’ Audience Research Board (BARB).

Through the third quarter (ended Sept. 30, 2018), more than 11.6 million homes in the U.K. had subscriptions to Netflix, Prime Video or Now TV – an increase of 22% from the previous-year period, according to BARB.

The research firm said Now TV ended the period with 5.7% household penetration and 7% million usage among consumers. That compared to 17.2% households (21% consumers) for Prime Video and 34.1% households (49.3%) for Netflix.

Now TV use grew 12.1% among households (11.6% among consumers), compared to 27.7% household (25%) growth for Prime Video; and 29.6% household (27.7% consumer) for Netflix.

Netflix continues to spearhead OTT video use, adding 2.2 million homes in Q3, while Prime Video and Now TV added more than 1 million homes and just under 200,000 households, respectively. BARB said the number of homes with two or more OTT services increased 40% from 2.8 million to just under 4 million in the past year.

Comcast says the addition of Sky (and Now TV) expanded the media company’s direct-consumer relationships to more than 54 million across the U.S. and Europe.

Steve Burke, CEO of NBC Universal, says Comcast’s pending AVOD service would incorporate Now TV technology and represents a good alternative for consumers not tethered to pay-TV/SVOD, while posing less of a risk in start-up costs.

“We think this approach has a much better chance to get scale quickly,” Burke said on the fiscal call.

 

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