Interesting article about HomeChoice state and expansion in Independent newspaper

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• [Deleted User] Posts: 3,008

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  07/09/04 - 11:07 #2

  In today's http://www.itvt.com/ newsletter which is available on a FREE subscription from the web site (not sure if you can get archive copies so here is the relevant section) to subscribe to "Tracy Swedlow's InteractiveTV Today" [itvt]
  http://www.itvt.com/subscribe.html
  

  Tracy Swedlow wrote:

  Video Networks News:
  by Tracy Swedlow
  --Holds Talks with UK Government, BBC about Offering Subsidized Service
  --Says it Plans to Raise up to £80 Mil to Fund National Expansion
  --Begins £2 Mil Ad Campaign Designed to Expand its London Footprint
  
  
  The UK newspaper, the Independent on Sunday, is reporting that Video Networks, the company behind the VOD-enabled TV-over-DSL service, HomeChoice, is in talks with the UK government's secretary of state for media, Tessa Jowell, and with the BBC, about offering a subsidized version of its service in order to accelerate the UK's DTV transition. (Note: the UK's analog switch-off is scheduled to take place in 2012.) The talks are centered around the idea of offering a basic package of 20 channels that would serve consumers who are currently unable to receive DTV service--for example, residents of high-rises who are unable to install satellite dishes or digital terrestrial antennas. "If you have a council flat that does not have digital television there is not much point marketing a £27-per-month package," Video Networks CEO, Roger Lynch, told the newspaper. "But if, in conjunction with the government, we could offer a low-level digital and maybe telephony package, it could be appealing." A spokesperson for Jowell was quoted by the newspaper as saying, "We welcome anything that increases choice. HomeChoice could prove attractive for someone who wants the service but does not have digital [or] cable, or if satellite installation is difficult."
  
  In other Video Networks news: the company says that it is looking to raise between £60 million and £80 million by the end of the year, in order to fund its planned expansion into several new cities, including Birmingham, Manchester and Glasgow. The company, whose service currently passes 1.25 million homes in London, expects it to pass over 4 million London homes within a year or so, and hopes to have around 25,000 subscribers by year's end. It says that it already has funding in place for its London expansion plans. (Note: the company has just launched a £2 million, 2-month print, radio, Web and outdoor advertising campaign to support its London expansion efforts. The campaign, which was created by The Grand Union, will highlight HomeChoice's VOD services, via the tagline "Demand More," and also draw attention to its linear channels, including Sky Movies, Extra and Sky Sports 1, 2, and 3, which are now available on the service thanks to a recently signed deal with BSkyB.) Video Networks has not yet decided whether the new round of fundraising will be, for example, via a share offering, an offering of convertible securities, or via private equity investment. It is also keeping open the option of holding an additional fundraising round next year, in order to support further national growth.
  
  Video Networks is one of only two companies in the UK that currently offer VOD (although ntl and BT are both expected to roll out their own VOD services later this year). For a long time, it was in very severe financial straits, due to the extremely high network charges that the UK's dominant telco, BT, had demanded from it: while the company charged its customers between £6 and £40 per month, it had to pay BT a £425 connection fee and £50 per month for each customer. As a result, it lost £162.5 million in 2002 on revenues of £3.1 million, and temporarily halted its subscriber-acquisition operations. It resumed its expansion efforts earlier this year, following a decision by BT to significantly reduce the fees it charges for access to its unbundled local loop.
  
  Although HomeChoice does not currently support the red-button ITV services that are offered by the UK's other digital television platforms, it features a number of interactive "hybrid" services that offer a unique combination of linear and on-demand television. The best-known of these is "V:MX," a collection of music video channels which earlier this year won the BAFTA award for best ITV service. It features a library of over 2,800 music videos, which are organized into 9 genre-based channels, and which viewers can search by genre, artist or track title. It allows viewers to pause, rewind and fast-forward, to skip videos they don't want to watch, and to compile personal favorites lists for later viewing (the top-30 videos that are most popular with HomeChoice subscribers are compiled each week into a channel, called "V:MX Chart"). HomeChoice also features a similar interactive "hybrid" service called "Scamp," which is targeted at pre-schoolers, and which Video Networks programs itself; a VOD service that provides viewers with a menu from which they can select and view segments from the BBC's News 24 channel; and a headend-driven PVR service, dubbed "Replay," that provides viewers with on-demand access via the EPG to popular shows that have been broadcast over the past 7 days on BBC One, BBC Two or Channel 4.

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• [Deleted User] Posts: 18,062

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  07/09/04 - 12:18 #3

  Video Networks also has intentions of trying to get help from the government with the switchover by offering to install its services in flats and the like to offer 20 odd channels via phonelines for people who can't get dtt via a shared ariel and can't have a private ariel and are not allowed a satellite dish and no community dish is avalaible.
  
  It's just like Skys freesat offer really , VN networks wants government funding to help expand its service and hope that once people get the freestuff they will be willing to upgrade.

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