Quibi Testing Ad-Supported Service in Australia, New Zealand

Upstart mobile-centric subscription streaming video platform Quibi has reportedly begun offering free ad-supported service in Australia and New Zealand. The SVOD service launched April 6 in the United States from DreamWorks Animation founder Jeffrey Katzenberg and eBay founder Meg Whitman.

With The Wall Street Journal in June reporting Quibi would generate less than 2 million paid subscribers by April 2021, the platform is apparently trying AVOD to jumpstart consumer traction. The service had projected 7.4 million paid subs after one year of operation.

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Quibi costs $4.99 monthly in the U.S. with advertising; $7.99 without ads. The AVOD trial is reportedly being rolled out on a market-by-market basis.

AVOD has gained mainstream adoption following high-profile corporate acquisitions of Pluto TV by ViacomCBS and Tubi by Fox Corp., respectively. Pluto claimed 33 million average monthly viewers through June 30.

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Tubi in February claimed 25 million average monthly users, with users supposedly watching 163 million hours of content in December — which was an increase of 160% from the previous-year period.

Regardless, Quibi needs to gain user traction to justify nearly $1.7 billion in third-party funding. The platform has an unfortunate predecessor in Verizon’s short-lived go90 mobile-centric video streaming app that folded less than three years after launch, resulting in a $1 billion write-down by the telecom giant.

Disney+ Signs Up 2 Million Aussies in 4 Months

Disney’s subscription streaming video platform launched in Australia and New Zealand on Nov. 19, 2019 — one week after its North American debut. New data from research group Roy Morgan finds Disney+ has attracted 2 million Aussies after four months. By comparison, Netflix took six months to generate 2 million subs after launching down under in 2015.

Disney+ is ahead of Amazon Prime Video with 1.6 million (up 1 million) and YouTube Premium at 1.47 million (up 161,000).

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Regardless, Netflix has extended its SVOD lead with 12.59 million Australians having access, an increase of more than 1 million. It is followed by Foxtel (including Kayo Sports) with an increase of 63,000 (4.87 million and 953,000 for Stan (3.72 million).

The relatively small sub increase for Foxtel is largely due to the strong performance of their sports-centric streaming service Kayo Sports, which attracted 704,000 viewers by March 2020, up by 530,000 on a year ago.

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When it comes to multiple subscription television services, Netflix plus Stan is the most popular combination with over 3.4 million Australians having access to both just ahead of Netflix plus Foxtel (3.1 million).

“The growth of subscription television services in Australia sped up in March as the nation entered a period of lockdown [due to COVID-19],” Roy Morgan CEO Michele Levine said in a statement.

Levine said that in March, more than 1 million Australians gained access to a SVOD service in their household. That compared with 893,000 SVOD additions in February.

“The increasing growth in the overall market has been predicted by many as Australians have been confined to their homes over the last two months and these results are the first to back up that prediction,” Levine said.

She contends that OTT video is growing due to the fact that different members of the same household are now able to have their own subscriptions to different services. Of Disney’s 2 million SVOD viewers, a large majority of 1.67 million (83%) subscribe to Netflix and 897,000 (45%) watch Stan.

“Foxtel’s launch next week of a new cut-price streaming service to go head-to-head against Netflix, Stan and Disney Plus does raise the risk of cannibalizing Foxtel’s existing revenue streams, but also sets Foxtel up take a share of the growing market of consumers increasingly gravitating towards low-cost services that offer extensive and deep catalogs,” Levine said.

Netflix, Amazon Prime Video See Double-Digit Growth in New Zealand

Even before the enforced lockdown in New Zealand due to concerns about the spread of the coronavirus, new data from Australian research firm Roy Morgan shows Netflix and Amazon Prime Video experienced double-digit viewership growth over the past 12 months.

Netflix is the most watched service, with a total of 2.42 million households having access, an increase of 291,000 households from the previous-year period. It is followed by Sky TV incl. Neon with 1.7 million households (+66,000), Lightbox with 875,000 (+113,000), Apple TV with 377,000, Prime Video with 322,000 (+191,000) and YouTube Premium with 234,000 (-7,000).

The data is based on in-depth interviews with more than 6,000 New Zealanders. CEO Michele Levine says that while Netflix remains the most popular pay television service, a number of its competitors are also experiencing considerable growth.

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“Netflix entered the New Zealand market in 2015, and has since transformed the television-watching landscape,” Levine said in a statement. Over the past year an additional 181,000 New Zealanders have gained access to a streaming service in their household and these service now reach over 3.2 million (82% of the population).”

Netflix and Lightbox are the two major services with large increases in viewers. New entrant Apple TV now reaches around 10% of the population while Prime Video has also experienced a large surge in viewers.

The survey was taken just as Disney+ was entering the market. Levine said the SVOD it is set to provide strong competition to established pay television services.

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“The current lockdown should provide a boost to not only new entrants such as Disney+ but also more established services as housebound Kiwis look for ways to entertain themselves,” she said.

Disney+ Launches in Australia, New Zealand and Puerto Rico

Disney’s branded subscription streaming video service, Disney+, has quietly launched in Australia, New Zealand and Puerto Rico — and in the process put immediate competitive pressure on reigning SVOD services Netflix and Stan with more than 11 million and 2.9 subscribers, respectively.

The arrival of the $8.99 (Australian) monthly or $89.99 annual Disney+ service features the identical 600 movies and 7,000 episodic programs available in the U.S. and Holland. And for the first time, the first 29 seasons of “The Simpsons” are available  Down Under.

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The Australian debut coincided with Disney content leaving Stan and also being removed from Foxtel, according to Ampere Analysis.

Disney+ household subscription affords up to four people streaming at the same time, downloads on up to 10 devices and the ability to set up to seven profiles.

Disney+ bows in the United Kingdom, France, Germany, Italy and Spain on March 31, 2020.

Netflix Tops 11 Million Subs Down Under

Netflix has 11.2 million subscribers in Australia — making the country of 24.6 million people the service’s second-most popular region behind the United States.

The SVOD behemoth, which launched service in Australia and New Zealand in 2015, saw subscriptions increase more 25% through February year-over-year, according to new data from Roy Morgan  research.

SVOD continues to mushroom in popularity down under with nearly 14 million Aussies having access to some form online TV, up 11.8% from a year ago.

The leading Australian-owned SVOD is Stan, which is accessible by over 2.6 million subs — up 45.2% from a year ago. Stan is a subsidiary of the Nine Entertainment Company.

SVOD services YouTube Premium (formerly YouTube Red), Fetch and Amazon Prime Video also saw significant sub increases.

YouTube Premium has over 1.2 million users, up 31.9%, and Fetch has nearly 760,000 users, up by 9%. Meanwhile, Prime Video more than doubled its user base by 116.7% to over 570,000.

“Pay-TV/Subscription TV services are an increasingly competitive marketplace in Australia,” Michele Levine, CEO of Roy Morgan, said in a statement. “Going forward the battleground will be content and cost.”


New Zealand Looking to Tax Web Giants Amazon, Google, Facebook

New Zealand Feb. 18 joined the European Union and Australia in seeking to tax Internet behemoths such as Amazon, Google and Facebook on revenue generated within its border.

Prime Minister Jacinda Ardern made the announcement in a post-cabinet press conference.

The proposed 2% to 3% tax would apply to any purchases and services sold by Internet firms regardless of their actual physical presence in the country.

“Some companies can do significant business in New Zealand without being taxed for the income they earn,” Ardern said. “This is not fair, and this is not sustainable.”

Indeed, Google’s subsidiary in New Zealand reportedly paid $393,000 in taxes in 2017 despite generating hundreds of millions in revenue.

The government said the tax could generate upwards of $55 million in additional annual revenue.

“Our current tax system is not fair in the way it treats individual tax payers, and how it treats multinationals,” said Ardern.

The move by New Zealand mirrors efforts in the United States by individual states such as South Dakota, which had its e-commerce tax lawsuit against online furniture retailer Wayfair reached the U.S. Supreme Court.

The high court last summer ruled states could charge taxes on companies doing business in the state without an actual physical presence.

A Georgia lawmaker this month proposed legislation seeking to tax digital entertainment services such as Netflix and Spotify 4% in an effort to compensate for declining pay-TV taxes statewide.

Such a user tax currently exists in Hawaii, Washington and Pennsylvania.


Kiwis Up SVOD Usage

More consumers in New Zealand are streaming video entertainment. Nearly 70% of Kiwis surveyed consider over-the-top video a good value proposition compared to pay-TV, according to new data from Canstar Blue. That was up 5% from last year.

Not surprisingly, Netflix has a lot to do with changing consumer behavior. Since launching service in Australia and New Zealand three years ago – the first in Asia Pacific for Netflix – consumer adoption has skyrocketed.

Netflix growth in Australia exceeded TV broadcast over an 18-month period last year – reaching more than 7.5 million subscribers through June, according to Roy Morgan Research.

But that affection didn’t immediately replicate itself in neighboring New Zealand.

“Until relatively recently, our TV choice was terrestrial TV, or paid service, Sky,” said Jose George, GM at Canstar. A sentiment, George said, was underscored by public perception that over-the-top platforms offered limited content.

“[Yet], streaming services continue to evolve, offering exclusive TV series on standard or HD services at a fraction of the cost [of pay-TV],” George said. “You don’t have to scratch too deep to see why there’s been such a surge in consumer sentiment.”

The uptick in over-the-top video in New Zealand has been helped by billions in infrastructure investment, resulting in more than 1.9 million broadband connections in 2015.

“Evidently, Kiwis love the Internet and the services it allows us to tap into,” George said.