John Drinnan on business

John Drinnan is a Herald business writer and media commentator

John Drinnan: Late entry in pay TV race

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"Orange Is the New Black."  Photo / AP / Netflix / Paul Schiraldi
"Orange Is the New Black." Photo / AP / Netflix / Paul Schiraldi

The race is on in the pay TV business between nimble challenger Telecom and that wily old contender Sky TV. Telecom yesterday released more programming for Lightbox, its subscription video on demand (SVOD) service.

Lightbox will launch towards the end of this month, bringing much needed competition to pay TV. Titles include several shows that have already played on Sky or on the free-to-air channels, including Masters of Sex, Orange is the New Black, Breaking Bad, House of Cards, Homeland, The Blacklist, Sons of Anarchy, Alpha House, Modern Family, Betas, Louie, Downton Abbey and Arrested Development.

Sky is expected to unveil its own SVOD service shortly. Both streaming services will focus on offering reruns of TV shows. But, increasingly, they will need to secure exclusive SVOD rights from Hollywood studios.

Read also:
Telecom TV fuels channel battle
Telecom unveils Lightbox line-up
Lightbox comes out guns blazing with strong line-up


Quikflix is already offering an SVOD service in this country, and the US giant Netflix is tipped to set up Downunder next year. All that activity is a sign of New Zealand catching up with the rest of the world though, in the medium term at least, most viewing is expected to remain on the existing "linear" channels offered by Sky, and by the free-to-air services.

With an estimated budget of $20 million in its first year, Lightbox is small fry compared to Netflix, or even Sky TV.

Sky will have a distinct advantage at the starting line. It's already a huge buyer of TV content, and can easily add on SVOD rights when it negotiates with Hollywood studios buying for its linear channels, such as Vibe and The Box.

Telecom chief executive Simon Moutter seems to be under no illusions that Lightbox will make Telecom glow with profits.

In the early days, at least, the value of Lightbox to Telecom is in its symbolism. While it will be a small part of Telecom for years to come, it shows the company moving from its past as a dominant incumbent telco, to being a digital services company taking on another dominant incumbent, Sky.

Telecom could not ignore the burgeoning influence of entertainment delivered over the internet. It has been interested in this strategy for years. Last decade it had a significant team which tried to develop a pay TV option. There was a lot of criticism that Telecom never went ahead, and it has come late to the party for pay TV.

In the past, the old model for pay TV involved heavy capital outlay to buy set-top boxes. Today, the SVOD model of streaming over the internet using broadband involves no set-top boxes or in-home installation.

It's a much cheaper way of taking on Sky, albeit from way back in the race.

TWEET ADS


Photo / Thinkstock

New Zealand Twitter followers are getting used to the increased focus on advertising and promoted tweets, since Twitter entered a relationship with digital services company Komli last year, and since it was listed.

It appears unlikely the advertising level will grow to anything near the level of Facebook, simply because it has a top end focus and is only being marketed to blue chip advertisers.

So far, it seems the service in New Zealand has 45-50 advertisers and doesn't expect to be going much higher. Tourism NZ has been an active Twitter advertiser, because it allows it to reach individual countries.

Speaking of Twitter ads, whatever happened to the #ad campaign launched by the Advertising Standards Authority in October 2012? The campaign aimed to ensure Twitter users make it clear when they are tweeting for commercial causes.

The ASA #ad campaign followed controversy about a celebrity endorsement by Wayne Rooney. In my experience, though, the #ad hashtag is nonexistent.

The campaign's failure is another reminder of the impossibility of policing the internet.

FUNNY BUSINESS
Anonymous websites or social media posts might be part of democracy, but they create special challenges for those who don't see the funny side, or believe they have been defamed.

The ColinCraig.co.nz website has added to the widespread attacks on Craig and his Conservative Party. Initially, the website's author was anonymous, but he has now been identified as Max Coyle, a former Green Party activist.

Identification of the author means it is now simpler for the notoriously litigious Craig to challenge Coyle, if he sees it fit.

Clive Eliott QC acts for clients who are both alleged defamers and defamees. He said anonymity, and the difficulty of tracking down some defendants, was becoming a big issue. However technology changed, any claim still had to identify a defendant then prove the case against them.


It might be good for democracy for people to be able to say things about politics and politicians, but the issue was different for those who believed they had been defamed, he said.

As it turned out, the ColinCraig.co.nz website was more restrained than some social media comments that have ridiculed him. The online attacks are marginally more personal than they are for other politicians, but it would be a shame if fear of litigation removed humour from the hustings, or obliged people to hide behind the cloak of anonymity.

RIP ROB COATS
A funeral was held in Auckland last week for Rob Coats, a former art director for Colenso in Auckland, who established New Zealand's first design shop aimed at the advertising and packaging sector. He was at Colenso from the late 1970s, a time when it was developing a dominant role in New Zealand advertising, and left in 1988 to form a specialist branding and design consultancy.

His former boss and lifelong friend, Gary Gwynn, created Rodd & Gunn and contracted Coats' firm to create the logo, featuring the famous hunting dog. He was also notable for the logo and branding for Michael Hill Jewellery and redesigning Hubbards cereal packaging.

About 400 people attended a service on Friday at St Mark's Church in Remuera, where there were eulogies from Gwynn and Brent Impey, the NZ Rugby chairman who was a close friend.

GAZA PR SLIDE
In a media sense, one of the biggest impacts of the assault on Gaza has been growing scepticism among US media about lobbying and public relations strategies employed by organisations such as the Israel Project.

It's an indication that a huge PR campaign is coming under strain, partly because of the impact of social media projecting images of the mayhem in Gaza, unfiltered by mainstream media.

The huge disparity in the death toll - and the deaths of many children - has made US media more inclined to question their previous stance in favour of Israel.

Keeping US media informed has been a key and very successful campaign by groups like the Israel Project, a non-governmental organisation based in Washington and Jerusalem.

Read the Israel Project's language guide here:

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- NZ Herald

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