VodafoneTV being switched off in September next year, Sky to pick up crumbs

Vodafone comms lead Nicky Preston said that 'VodafoneTV didn't reach the customer numbers or scale that we hoped it would'. Video / Vodafone

Vodafone says it will turn off its VodafoneTV service on September 30 next year.

Around 100,000 customers are on the service, Vodafone says.

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The telco's commercial director Joe Goddard says customers are being given nine months' notice today to allow a smooth transition.

A Vodafone TV unit cost $150, with a customer then paying for Sky, plus any streaming services they used through the box, for their services.

Goddard said, "We'll be working closely with Sky to transition relevant customers directly to them - or to provide people with advice on alternative solutions such as Smart TVs, Chromecast or Freeview."

Don't look for any windfall for Sky, however. The pay-TV broadcaster says Vodafone TV owners who use the telco's platform to subscribe to its channels are already included in its total customer numbers.

"It's fair to say VodafoneTV didn't reach the customer numbers or scale that we hoped it would, and has been operating at a loss," Vodafone comms lead Nicky Preston told the Herald.

"The content landscape has rapidly changed, especially with a proliferation of internet-connected devices on which to view content, from Smart TVs to tablets and phones.

A Vodafone TV box and remote (foreground). The service delivers Sky and free-to-air channels over UFB fibre or cable, eliminating the need for a Sky dish, and supports apps like Netflix.

"We would rather invest into areas like customer service, network and technology to provide customers with great connectivity and digital services, instead of continuing to run VodafoneTV as a loss-making service.

"Customers may be entitled to a refund depending on when they purchased and activated their VodafoneTV," Preston said.

"If this is the case, we'll be in touch directly with those people in the next few months. We're asking customers to please not go back to the retail store they purchased their VodafoneTV from, as they'll be unable to help. We'll be handling all parts of this process directly."

It has yet to be finalised which customers will qualify for a refund.

VodafoneTV was launched at a joint presentation hosted by then Vodafone NZ CEO Russell Stanners and then Sky TV CEO John Fellet.

When the two companies first discussed the box, they were in merger talks - but a tie-up was ultimately scuttled by the Commerce Commission and courts.

In August 2019, Vodafone introduced Version 2 of Vodafone TV, with a faster interface, built-in Wi-Fi and a change in market positioning with the device available to everyone, not just the telco's own customers.

Despite its relatively low profile, Vodafone TV had a number of advantages over Sky's decoder.

It received all of its channels over fibre, eliminating the need for a dish on your roof. It also offered hundreds of hours of cloud-based storage, 4K ultra high definition and support for third-party streaming apps like Netflix.

Then Sky TV CEO John Fellet, left, and then Vodafone NZ CEO Russell Stanners at the launch of Vodafone TV in October 2017. When the next-generation box was conceived, the two companies were in merger talks - which were ultimately scuttled by the Commerce Commission and the courts. Photo / File

But Sky has an Android-powered box on the way that will match Vodafone TV's features.

This morning, Sky confirmed its new hardware is on track to launch mid-way through next year.

Another significant change in the market is the rise of smart TVs, which allow customers to access apps like Netflix, Disney+, Amazon Prime Video and Spark Sport (so conspicuously absent from Vodafone TV) from their regular remote, no extra hardware required.

Sky's new Android-powered box, due mid-2022, will offer many of the same features as Vodafone TV, including Sky channels over fibre and support for apps like Netflix. Photo / Supplied

Then there are those who access streaming services that aren't tied to any particular piece of hardware.

Sky said at its full-year FY2021 report that 393,000 people are now paying for its Neon, Sky Sport Now or Rugby Pass services - a 57 per cent year-on-year increase.

The balance of its 990,000 subscribers use its decoders.