Spark ups investment in Lightbox TV

Simon Moutter, Spark managing director. New Zealand Herald Photograph by Chris Loufte

Spark New Zealand has announced it is increasing investment in its internet television service Lightbox.

In its first half year result this morning, the company said it was increasing investment from an estimated $20 million at its full year 2014 announcement, to $35 million, with around $5 million in capital expenditure, effectively almost doubling its investment in the service.

At it's results announcement this morning, Moutter said the company's digital strategy was "resonating strongly" with customers, but was reluctant to comment specifically on Lightbox.

"We will not be providing any indication of subscribers or ARPU's [for Lightbox]," he said. "It is a highly competitive market developing out there and at this time we are not prepared to provide those benchmarks that enable our competitors to triangulate against how were doing."

Lightbox, which Spark has been offering free to new customers, comes up against strong competition in the form of Sky TV's Neon subscription video-on-demand service, launched last week and the US service Netflix, set to launch in March. Last month, Spark's chief executive of home mobile business Chris Quin, said the Lightbox offering was aimed at adding value for customers.

"There might be lower cost broadband in the market, but the added value of free Lightbox will make it attractive," Quin said. "From an industry point of view it's important to get people watching more video on broadband. The future of our business is video entertainment."

Moutter said he would update the market further about Lightbox's progress at Sparks full year result announcement.

"We do have some metrics in mind and we'll provide more colour on that at the full year when I tell you exactly where we're tracking but it's a fast changing market and it means we have to adjust quickly to what the trends are and what the consumers want and are willing to pay for," Moutter said.

"[We're going to] keep our options open and follow what works here over the next two to three years."