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BSkyB to Launch Standalone Internet TV Service Now TV on Tuesday

BSkyB
Chris Ratcliffe/Bloomberg/Getty Images

UPDATED: The service that will target the market, in which Amazon.com's LoveFilm and Netflix are already playing, will cost $23 for a monthly subscription, with BSkyB betting that it won't encourage cord cutting.

LONDON - British pay TV giant BSkyB will on Tuesday launch its much-anticipated standalone Internet TV service Now TV that will play in a similar space as Amazon.com's LoveFilm and Netflix.

The service, for which customers won't need a BSkyB pay TV subscription, will cost £15 ($23) for a monthly subscription called Sky Movies Pass or 99 pence-£3.49 ($1.55-$5.42) for single movie titles under a "pay & play" service. The company is branding the service as "Now TV powered by Sky."

The service will start off with movies, with Sky Sports - including live sports - and Sky entertainment networks content expected to be added over the coming year. Executives at a launch breakfast at the London Film Museum on Monday declined to discuss the packaging and pricing once that additional content is added, saying it would be finalized and unveiled at a later stage.

Movies for the monthly subscription offer will come from the Sky Movies collection, which includes 600 films from Hollywood majors such as Disney, Fox, Paramount, Sony, Warner Bros. and Universal Pictures and 11 Sky Movies channels. Bridesmaids, Green Lantern and Safe House were among the films touted Monday morning as being available at launch. Sky Movies is the U.K.'s most popular U.K. movie subscription service.

The pay and play service will offer 1,000 movies from latest blockbusters to library classics. Once a consumer pays for a title, he or she will have 28 days to start viewing it and then have 48 hours to watch it as often as desired.

BSkyB's goal is to grow its reach beyond the country's current pay TV homes as penetration in the U.K. is lower than in the U.S. Now TV is "about to give millions more people an easy and commitment-free way" to enjoy movies, BSkyB said.

"Now TV will bring more choice to U.K. consumers and an easy way to enjoy amazing movies instantly," Simon Creasey, director of Now TV told the breakfast meeting. "Following the explosion in Internet-connected devices, we know that more and more poeple are looking for great content to watch over the web."

Now TV will be available on PCs, Apple's Mac computers, selected Android smartphones and, within a month or so, iPhones and iPads, followed by the XBox later this summer. Other devices, such as the PlayStation 3 and Roku players, are also scheduled to be added.

BSkyB executives emphasized that the service was designed to help the company attract some of the 13 million U.K. homes that don't get pay TV service yet.
The company had previously said that it would launch the over-the-top service some time this summer, but it hadn't unveiled full timing and pricing details. Rupert Murdoch's News Corp. owns a 39 percent stake in BSkyB.

Simon Rexworthy, controller of acquisitions for Sky Movies, told THR that the company is not worried about cannibalizing its pay TV subscriber base or encouraging cord cutting, arguing that its Sky Go online service, which is similar to HBO Go in the U.S., and Now TV will target different consumer groups.

"We considered what could happen," he said. "Our honest view is that they are complimentary. Sky subscribers want everything on TV and a whole suite of content, including HD and 3D. But there are other people who for whateveer reason don't want that."

What about cord cutting? "We don't think we'll encourage that," Rexworthy said. " The U.S. market is far more mature than the U.K. pay TV market...And the reality is that in the U.S., demographics are far more mixed - from high-end users to a lower end. We see our services as complimentary, and now we give customers a clearer choice."

While he declined to provide subscriber or usage targets for Now TV, Rexworthy said: "We'll be a big player."

The executive also told THR that BSkyB is not necessarily using Now TV to target Netflix or LoveFilm. "We just look at the U.K. market like they do and see the same opportunity," he said. "We wanted to launch a service properly built for over-the-top [broadband] world, which we see as a great new opportunity."

While Now TV will come at a higher montly price tag for those who choose a monthly subscription, "we have recently added blockbusters that they don't have for a full 12 months at least," Rexworthy emphasized. "Also, Netflix skews towards TV and much older content, so all this supports the higher price."

What executives also highlighted at the breakfast event on Monday was that Now TV will make five new movies available each Friday at least 12 months before other online subscription services can provide them. The company also emphasized that around 75 percent of the top 100 movies will be offered on the service.

Now TV and BSkyB executives said Monday that customers will be able to access Now TV on two devices for now, the same number approved for Sky Go. But the service is talking to studios about possibly adding more devices in the future, executives said.

A brand dispute about the name Now TV, meanwhile, doesn't seem to worry BSkyB. A company in Hong Kong has said it has the rights to that brand name. Executives told THR on Monday though that they feel pretty comfortable with the use of the name and said they researched their rights well. One executive even said that BSkyB had some talks with the Asian group, but didn't offer further details.
 

Email: Georg.Szalai@thr.com

Twitter: @georgszalai