Spark is giving away its subscription video-on-demand service Lightbox to broadband subscribers to encourage people towards online entertainment and uncapped broadband deals.
The 12-month giveaway was announced yesterday and should give Lightbox a solid foundation as competition heats up for streamed TV delivered online and played through devices such as computers, smart TVs and tablets.
Sky TV is expected to start its Neon subscription video-on-demand service at the end of the month and the US service Netflix is set for March.
Spark says its move is intended to provide added value for its broadband customers.
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"There might be lower cost broadband in the market, but the added value of free Lightbox will make it attractive," said Spark's chief executive of home mobile and business, Chris Quin.
"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."
The free Lightbox package has been welcomed by Internet New Zealand and the Telecommunications Users Association of New Zealand, which said it signalled greater options for consumers as internet services improved.
Spark is encouraging customers towards higher-cost all-you-can-eat broadband plans. The move coincides with the company reducing the price for its uncapped plan from $109 to $99 a month and the decision to stop marketing the 150 gigabyte broadband plan from next month.
Customers will be able to pay for packages of 40 gigabytes and 80 gigabytes, and the next option will be to buy an unlimited broadband offer to fit the growing number of online entertainment options.
Sky chief executive John Fellet said the free Lightbox offer was "good for Sky". With Lightbox free, Spark customers might be willing to buy another pay service, such as Sky.