So do you think this will work? All these price rises? Will most users just be apathetic about these continued increases? Or will Sky's churn now just increase?
I don't really want to cancel any of the packages but as I said in my last post it is now time to start bringing the cost down so once my viewing discounts are up ( offered to recontract to bb and line rental) I will have to give up some of the viewing options so Multiroom and sky go extra are def going. £15 per month saving there so should see off any rise this year.
I know the rise is not going to kill me but it has to stop somewhere and become what I feel is value for money again
So do you think this will work? All these price rises? Will most users just be apathetic about these continued increases? Or will Sky's churn now just increase?
It depends exactly what you mean by "work".
Assuming Sky does put prices up by far more than inflation (which we don't actually yet know for certain) then I imagine that churn probably will increase.
But even if churn does increase it may still be the "right" thing for Sky to do if it leads to higher revenues and profits - not just short-term but more importantly over the medium to long term.
Don't want to repeat what I said before but in summary Sky may think it's right to move further up market - ie lower value customers are more likely to be lost now anyway so no point in holding prices down just to keep that segment if more can be raised from the top end of the market.
Other point is that Sky will be doing a mountain of customer research etc so they'll be pretty well placed to judge the likely outcome - eg price rise A will lead to churn B, price rise X will lead to churn Y etc. Plus they'll also have a lot of historical and other data - eg what competitors are doing and are likely to do etc.
Assuming Sky does put prices up by far more than inflation (which we don't actually yet know for certain) then I imagine that churn probably will increase.
But even if churn does increase it may still be the "right" thing for Sky to do if it leads to higher revenues and profits - not just short-term but more importantly over the medium to long term.
Don't want to repeat what I said before but in summary Sky may think it's right to move further up market - ie lower value customers are more likely to be lost now anyway so no point in holding prices down just to keep that segment if more can be raised from the top end of the market.
Other point is that Sky will be doing a mountain of customer research etc so they'll be pretty well placed to judge the likely outcome - eg price rise A will lead to churn B, price rise X will lead to churn Y etc. Plus they'll also have a lot of historical and other data - eg what competitors are doing and are likely to do etc.
So, if I take an extreme point of view to what you have said, Sky, over the course of its 'life' will have moved from an initial position of TV for the masses (re the very old council estate dish jibes), to now being Premium TV mainly for the affluent.
I'm not really sure I'm comfortable with that concept. Even though their a business, not a charity.
So, if I take an extreme point of view to what you have said, Sky, over the course of its 'life' will have moved from an initial position of TV for the masses (re the very old council estate dish jibes), to now being Premium TV mainly for the affluent.
I'm not really sure I'm comfortable with that concept. Even though their a business, not a charity.
OFCOM and other research has for a long time showed that Sky skews much more heavily ABC1 than the UK average.
eg Just had a quick look - if we go back to Sky's 2007 accounts it says (P10; or 11/115 - 3rd paragraph under "Advertising"):
"Our subscribers’ households tend to be younger and more affluent than the average UK household and tend to over-represent the 16-34 year old, ABC1 (i.e. upmarket) and male
demographic profiles sought by many advertisers."
I'm not sure if there is any data going back to the early days but my hunch would be that Sky has always skewed more ABC1 than average at least back to the period soon after the launch of Sky Digital in 1998 - which is what ignited rapid customer growth after several years of stagnation before that.
Just for a bit of speculation (as if we don't have enough of that already on occasions ), how do we think the 'upto 10%' will be achieved? Will we see the 'base' package go up from £21.50 to £23.65, and the odd £1-£1.50 added to the other packages as usual? So, the price rise will be less in percentage terms the higher up the package ladder you go?
I suppose the Sky Sports customers will just absorb it. Where else would you go? If you can't get VM, then you don't really have a choice aside from complete cancellation (right now at least). If I wasn't after a discount at the moment, then I've no doubt I would just absorb it.
Another thought about this is - Sky World (or Sports) customers with ESPN now will see a drop of £10 pm come August. Sky push prices up by maybe 10% - so possibly a large chunk of that £10 pm saving.
Just at the point where customers are deciding whether to pay for BT Sports to replace ESPN.
If ESPN goes and BT Sports arrives with its higher pm charge it is still only a net rise to your Sky bill of £3 - £5 pm.
If Sky prices go up by - say - £6 pm - are Sky calculating that some will choose to stay with their Sky package, pay much the same as now on balance (price rise minus ESPN charge off your bill) - with the signing up to BT Sports being the thing many of them choose not to do in order to balance personal budgets.
Another thought about this is - Sky World (or Sports) customers with ESPN now will see a drop of £10 pm come August. Sky push prices up by maybe 10% - so possibly a large chunk of that £10 pm saving.
Just at the point where customers are deciding whether to pay for BT Sports to replace ESPN.
If ESPN goes and BT Sports arrives with its higher pm charge it is still only a net rise to your Sky bill of £3 - £5 pm.
If Sky prices go up by - say - £6 pm - are Sky calculating that some will choose to stay with their Sky package, pay much the same as now on balance (price rise minus ESPN charge off your bill) - with the signing up to BT Sports being the thing many of them choose not to do in order to balance personal budgets.
And if the above did happen, the ironic thing about it is that wouldn't bother BT one jot. As they don't really want Sky customers paying for it.
Unlimited internet: £5 with Sky tv (£10 without)
Fibre 38: £15 with Sky tv (£20 without)
Fibre Pro 76: £25 with Sky tv (£30 without)
Line rental: £14.95
Unlimited calls: £5
Full TV with unlimited calls and internet: ~£95
Lowest pack rises just £0.45 (many minimum tv customers will also take phone and broadband, no need to pointlessly lose them).
Entertainment Extra+ up £2.45, less than 10%, sweet point of more revenue per customer whilst unlikely to see significant downgrades.
Sports up ~15%, again i think this is the sweet spot, not extortionate and even though sports fans won't be pleasd they don't have a real alternative. Multiroom also up by ~15%, squeezing extra revenue from those who tend to be less price sensitive.
Internet options more attractive for triple play subscribers helping to fend off competition for new broadband customers and minimise churn in response to aggressive marketing of TalkTalk and BT.
And if the above did happen, the ironic thing about it is that wouldn't bother BT one jot. As they don't really want Sky customers paying for it.
Nonsense. Sky triple play customers with Sky Sports skew ABC1; many won't switch providers. The direct revenue(via subsciptions) and indirect benefits (charge more for advertising and secure better TV deals due to increased reach) will be important to BT.
Nonsense. Sky triple play customers with Sky Sports skew ABC1; many won't switch providers. The direct revenue(via subsciptions) and indirect benefits (charge more for advertising and secure better TV deals due to increased reach) will be important to BT.
Nonsense. And that wasn't my point. As they are not really after people paying for it. Hence why these new offers have been skewed so to make it free for BT BB customers. They would merely regard any extra pay-for revenue as a bonus, not an essential.
Unlimited internet: £5 with Sky tv (£10 without)
Fibre 38: £15 with Sky tv (£20 without)
Fibre Pro 76: £25 with Sky tv (£30 without)
Line rental: £14.95
Unlimited calls: £5
Full TV with unlimited calls and internet: ~£95
Lowest pack rises just £0.45 (many minimum tv customers will also take phone and broadband, no need to pointlessly lose them).
Entertainment Extra+ up £2.45, less than 10%, sweet point of more revenue per customer whilst unlikely to see significant downgrades.
Sports up ~15%, again i think this is the sweet spot, not extortionate and even though sports fans won't be pleasd they don't have a real alternative. Multiroom also up by ~15%, squeezing extra revenue from those who tend to be less price sensitive.
Internet options more attractive for triple play subscribers helping to fend off competition for new broadband customers and minimise churn in response to aggressive marketing of TalkTalk and BT.
If that happened then Sky World (as it was - this name seems to have recently been dropped by Sky) plus HD would rise significantly.
HD with what was Sky World was £10.25 not £5 - so I assume you are not suggesting this be decreased by Sky to £5.95?
So if HD rises in your scenario the same as multiroom then that is a whacking increase for top tier customers.
I think it will lose Sky some custom. I have seen several posts already saying a big rise like the above will see customers lose something and movies seems the favoured thing to be dispensed with.
Big rises in Sky Sports will, I suspect, lose Sky money via dropped movie subscriptions - especially now you can access these lots of other ways and even via Sky pay per view on demand.
One possible scenario:
......
HD: £5.95
Multiroom: £11.95
......
....Multiroom also up by ~15%, squeezing extra revenue from those who tend to be less price sensitive.
Increases above 10% on products that are contracted for 12 months would enable customers to exit those contracts early without penalty- in some instances, for example, having acquired discounted equipment/installation on which Sky have yet to recover their costs.
It's not inconceivable that they could do it- they did it on line rental and I consequently gave notice on Fibre, line rental and calls 3 months in to a 12 month contract- however, there are contractual consequences for doing so and in the case of multiroom (9,000 growth in the last quarter), a significant price increase would likely push multiroom subscriptions in to decline, in my view, at a time when Sky Go is increasingly being seen as a valid alternative.
Increases above 10% on products that are contracted for 12 months would enable customers to exit those contracts early without penalty- in some instances, for example, having acquired discounted equipment/installation on which Sky have yet to recover their costs.
Minor point, but out of interest does the 10% rule apply to each individual component or the overall package?
eg - NOT precise numbers but illustrative just to make the point:
Entertainment - up 7%
Sports - up 12%
Total (TV) bill up, say, 9.5% - would that trigger 10% rule (for Sports only) or not?
Nonsense. And that wasn't my point. As they are not really after people paying for it. Hence why these new offers have been skewed so to make it free for BT BB customers. They would merely regard any extra pay-for revenue as a bonus, not an essential.
Of the sports fans unable/unwilling to move from Sky BT will want every single one of them to subscribe. It will increase revenue and make it easier to entice such customers to a BT triple play package should BT Sports become essential.
Edit: BT's primary strategy is self-evident but stand-alone subscribers are still important; suggesting that BT couldn't care less is an extreme position.
If that happened then Sky World (as it was - this name seems to have recently been dropped by Sky) plus HD would rise significantly.
HD with what was Sky World was £10.25 not £5 - so I assume you are not suggesting this be decreased by Sky to £5.95?
So if HD rises in your scenario the same as multiroom then that is a whacking increase for top tier customers.
I think it will lose Sky some custom. I have seen several posts already saying a big rise like the above will see customers lose something and movies seems the favoured thing to be dispensed with.
Big rises in Sky Sports will, I suspect, lose Sky money via dropped movie subscriptions - especially now you can access these lots of other ways and even via Sky pay per view on demand.
I believe Sky may tweak the current policy of those wanting HD sports without the full entertainment pack paying full price (seeing as retentions are currently giving HD away for £2.50). So £5.95 would get you the FTA and premiums in HD only.
Of the sports fans unable/unwilling to move from Sky BT will want every single one of them to subscribe. It will increase revenue and make it easier to entice such customers to a BT triple play package should BT Sports become essential.
Essential? I wouldn't say that either. The BT Sport package (including ESPN) will only be offering a modest package compared to Sky Sport. This is, imo, only being offered as an inducement, not a replacement.
Essential? I wouldn't say that either. The BT Sport package (including ESPN) will only be offering a modest package compared to Sky Sport. This is, imo, only being offered as an inducement, not a replacement.
Become essential; as in increased PL rights secured at the next auuction alongside other premium content (CL, FA Cup).
With regards to the FA rights would Sky and ITV be allowed to make a joint purchase (as with the recently secured European rights)? Alternating first picks in the FA Cup with ITV taking the England rights would surely appeal to both.
With regards to the FA rights would Sky and ITV be allowed to make a joint purchase (as with the recently secured European rights)? Alternating first picks in the FA Cup with ITV taking the England rights would surely appeal to both.
Can't see why not - the FA can do what it wants - if ITV and Sky make joint bids for various packages then the FA is free to accept those bids if it so wishes.
NB. Haven't checked fine print of tender - I guess it may say something about joint bids.
Become essential; as in increased PL rights secured at the next auuction alongside other premium content (CL, FA Cup).
With regards to the FA rights would Sky and ITV be allowed to make a joint purchase (as with the recently secured European rights)? Alternating first picks in the FA Cup with ITV taking the England rights would surely appeal to both.
Ah. Thanks for that. In regard to your second point, it was expected ITV4 would 'work closely' with BT Sport for the rugby, but its all gone quiet on that front.
HD with what was Sky World was £10.25 not £5 - so I assume you are not suggesting this be decreased by Sky to £5.95?
The HD Pack is currently £5pm. However, it only applies to Movies and Sports and you are now forced to get Entertainment Extra+ to use it, which is £10pm more than Entertainment.
So really, for those only interested in sports, the HD Pack is currently £15pm.
Ah. Thanks for that. In regard to your second point, it was expected ITV4 would 'work closely' with BT Sport for the rugby, but its all gone quiet on that front.
That was lazy speculation based on nothing more than ITV Sport bidding to produce the coverage (I think someone else won IIRC) ITV4 will do nothing more than show highlights (though that's unconfirmed), though with Craig Doyle and Martin Bayfield off to BT I guess both will no longer be involved.
The HD Pack is currently £5pm. However, it only applies to Movies and Sports and you are now forced to get Entertainment Extra+ to use it, which is £10pm more than Entertainment.
So really, for those only interested in sports, the HD Pack is currently £15pm.
Whoa. Thats the equivalent of the BT Vision Unlimited package with all the new internet TV channels. And HD included too.
Minor point, but out of interest does the 10% rule apply to each individual component or the overall package?
eg - NOT precise numbers but illustrative just to make the point:
Entertainment - up 7%
Sports - up 12%
Total (TV) bill up, say, 9.5% - would that trigger 10% rule (for Sports only) or not?
In my view, there is no rule that states that a tv package price cannot average out below 10%, rather than each element being below 10%.
This is very complex but "10%" is arrived at, as I understand, through a combination of what is stipulated in the terms & conditions and regulatory interpretation of "The Unfair Terms in Consumer Contracts Regulations".
The issue involved is whether a change constitutes a "material disadvantage" and 10% seems to have become generally accepted as a "tipping point" rather than a stipulation of law.
My interpretation, however, is that certain products/services represent separate contracts with their own terms & conditions and that increasing those above 10% would trigger the right of a customer to cancel those elements.
The lines are clearer in terms of TV, Broadband and Talk, as they are presented by Sky as separate terms & conditions.
My opinion is that the position is not so clear on additional tv services such as multiroom and HD, but that they might constitute separate contracts and lead to reasonable claims of "material disadvantage" that would enable that element to be cancelled penalty-free were the increase to be above 10%.
Comments
I don't really want to cancel any of the packages but as I said in my last post it is now time to start bringing the cost down so once my viewing discounts are up ( offered to recontract to bb and line rental) I will have to give up some of the viewing options so Multiroom and sky go extra are def going. £15 per month saving there so should see off any rise this year.
I know the rise is not going to kill me but it has to stop somewhere and become what I feel is value for money again
It depends exactly what you mean by "work".
Assuming Sky does put prices up by far more than inflation (which we don't actually yet know for certain) then I imagine that churn probably will increase.
But even if churn does increase it may still be the "right" thing for Sky to do if it leads to higher revenues and profits - not just short-term but more importantly over the medium to long term.
Don't want to repeat what I said before but in summary Sky may think it's right to move further up market - ie lower value customers are more likely to be lost now anyway so no point in holding prices down just to keep that segment if more can be raised from the top end of the market.
Other point is that Sky will be doing a mountain of customer research etc so they'll be pretty well placed to judge the likely outcome - eg price rise A will lead to churn B, price rise X will lead to churn Y etc. Plus they'll also have a lot of historical and other data - eg what competitors are doing and are likely to do etc.
So, if I take an extreme point of view to what you have said, Sky, over the course of its 'life' will have moved from an initial position of TV for the masses (re the very old council estate dish jibes), to now being Premium TV mainly for the affluent.
I'm not really sure I'm comfortable with that concept. Even though their a business, not a charity.
OFCOM and other research has for a long time showed that Sky skews much more heavily ABC1 than the UK average.
eg Just had a quick look - if we go back to Sky's 2007 accounts it says (P10; or 11/115 - 3rd paragraph under "Advertising"):
"Our subscribers’ households tend to be younger and more affluent than the average UK household and tend to over-represent the 16-34 year old, ABC1 (i.e. upmarket) and male
demographic profiles sought by many advertisers."
http://corporate.sky.com/documents/pdf/publications/annual_report_2007.pdf
I'm not sure if there is any data going back to the early days but my hunch would be that Sky has always skewed more ABC1 than average at least back to the period soon after the launch of Sky Digital in 1998 - which is what ignited rapid customer growth after several years of stagnation before that.
I suppose the Sky Sports customers will just absorb it. Where else would you go? If you can't get VM, then you don't really have a choice aside from complete cancellation (right now at least). If I wasn't after a discount at the moment, then I've no doubt I would just absorb it.
Just at the point where customers are deciding whether to pay for BT Sports to replace ESPN.
If ESPN goes and BT Sports arrives with its higher pm charge it is still only a net rise to your Sky bill of £3 - £5 pm.
If Sky prices go up by - say - £6 pm - are Sky calculating that some will choose to stay with their Sky package, pay much the same as now on balance (price rise minus ESPN charge off your bill) - with the signing up to BT Sports being the thing many of them choose not to do in order to balance personal budgets.
And if the above did happen, the ironic thing about it is that wouldn't bother BT one jot. As they don't really want Sky customers paying for it.
Entertainment: £21.95
Entertainment Extra: £27.95
Entertainment Extra+: £33.95
Movies: £16
Sports: £24
Both: £30
HD: £5.95
Multiroom: £11.95
Sky Go Extra: £5
Would make the full tv pack ~£70
Unlimited internet: £5 with Sky tv (£10 without)
Fibre 38: £15 with Sky tv (£20 without)
Fibre Pro 76: £25 with Sky tv (£30 without)
Line rental: £14.95
Unlimited calls: £5
Full TV with unlimited calls and internet: ~£95
Lowest pack rises just £0.45 (many minimum tv customers will also take phone and broadband, no need to pointlessly lose them).
Entertainment Extra+ up £2.45, less than 10%, sweet point of more revenue per customer whilst unlikely to see significant downgrades.
Sports up ~15%, again i think this is the sweet spot, not extortionate and even though sports fans won't be pleasd they don't have a real alternative. Multiroom also up by ~15%, squeezing extra revenue from those who tend to be less price sensitive.
Internet options more attractive for triple play subscribers helping to fend off competition for new broadband customers and minimise churn in response to aggressive marketing of TalkTalk and BT.
Nonsense. Sky triple play customers with Sky Sports skew ABC1; many won't switch providers. The direct revenue(via subsciptions) and indirect benefits (charge more for advertising and secure better TV deals due to increased reach) will be important to BT.
Nonsense. And that wasn't my point. As they are not really after people paying for it. Hence why these new offers have been skewed so to make it free for BT BB customers. They would merely regard any extra pay-for revenue as a bonus, not an essential.
If that happened then Sky World (as it was - this name seems to have recently been dropped by Sky) plus HD would rise significantly.
HD with what was Sky World was £10.25 not £5 - so I assume you are not suggesting this be decreased by Sky to £5.95?
So if HD rises in your scenario the same as multiroom then that is a whacking increase for top tier customers.
I think it will lose Sky some custom. I have seen several posts already saying a big rise like the above will see customers lose something and movies seems the favoured thing to be dispensed with.
Big rises in Sky Sports will, I suspect, lose Sky money via dropped movie subscriptions - especially now you can access these lots of other ways and even via Sky pay per view on demand.
It's not inconceivable that they could do it- they did it on line rental and I consequently gave notice on Fibre, line rental and calls 3 months in to a 12 month contract- however, there are contractual consequences for doing so and in the case of multiroom (9,000 growth in the last quarter), a significant price increase would likely push multiroom subscriptions in to decline, in my view, at a time when Sky Go is increasingly being seen as a valid alternative.
Minor point, but out of interest does the 10% rule apply to each individual component or the overall package?
eg - NOT precise numbers but illustrative just to make the point:
Entertainment - up 7%
Sports - up 12%
Total (TV) bill up, say, 9.5% - would that trigger 10% rule (for Sports only) or not?
I think the point is that the first £5 (approx) of HD charge is now within Entertainment Extra+.
So the separate HD add on is now only the other (approx) £5.
Although existing customers (including me!!!) are still on the old basis paying the £10.25 for HD all in one go (ie without EE+).
Of the sports fans unable/unwilling to move from Sky BT will want every single one of them to subscribe. It will increase revenue and make it easier to entice such customers to a BT triple play package should BT Sports become essential.
Edit: BT's primary strategy is self-evident but stand-alone subscribers are still important; suggesting that BT couldn't care less is an extreme position.
I believe Sky may tweak the current policy of those wanting HD sports without the full entertainment pack paying full price (seeing as retentions are currently giving HD away for £2.50). So £5.95 would get you the FTA and premiums in HD only.
Essential? I wouldn't say that either. The BT Sport package (including ESPN) will only be offering a modest package compared to Sky Sport. This is, imo, only being offered as an inducement, not a replacement.
Become essential; as in increased PL rights secured at the next auuction alongside other premium content (CL, FA Cup).
With regards to the FA rights would Sky and ITV be allowed to make a joint purchase (as with the recently secured European rights)? Alternating first picks in the FA Cup with ITV taking the England rights would surely appeal to both.
Can't see why not - the FA can do what it wants - if ITV and Sky make joint bids for various packages then the FA is free to accept those bids if it so wishes.
NB. Haven't checked fine print of tender - I guess it may say something about joint bids.
Ah. Thanks for that. In regard to your second point, it was expected ITV4 would 'work closely' with BT Sport for the rugby, but its all gone quiet on that front.
So really, for those only interested in sports, the HD Pack is currently £15pm.
Whoa. Thats the equivalent of the BT Vision Unlimited package with all the new internet TV channels. And HD included too.
In my view, there is no rule that states that a tv package price cannot average out below 10%, rather than each element being below 10%.
This is very complex but "10%" is arrived at, as I understand, through a combination of what is stipulated in the terms & conditions and regulatory interpretation of "The Unfair Terms in Consumer Contracts Regulations".
The issue involved is whether a change constitutes a "material disadvantage" and 10% seems to have become generally accepted as a "tipping point" rather than a stipulation of law.
My interpretation, however, is that certain products/services represent separate contracts with their own terms & conditions and that increasing those above 10% would trigger the right of a customer to cancel those elements.
The lines are clearer in terms of TV, Broadband and Talk, as they are presented by Sky as separate terms & conditions.
My opinion is that the position is not so clear on additional tv services such as multiroom and HD, but that they might constitute separate contracts and lead to reasonable claims of "material disadvantage" that would enable that element to be cancelled penalty-free were the increase to be above 10%.
Aye, Sunset+Vine