EE expands into TV with set top box

09/10/2014

UK 4G mobile operator EE is to launch a fixed-line TV service, competing with BT, Sky, YouView, Virgin Media and TalkTalk.

The EE service will be available free with an EE home broadband subscription, or for £9.95 ($16) a month for mobile-only subscribers

The new EE TV service will ‘merge smartphones, tablets and TV’ into a single service, the company claimed.

Like rival YouView, it will offer a mixture of live, on-demand and recorded television, but it will add smartphones and tablets to the service, allowing up to three such devices to also access TV content.

More than 70 Freeview channels, as well as the BBC iPlayer, Demand Five, YouTube and other catch-up services will be part of the service at launch, which will however not be able to access Sky or BT TV services including sport and movies. Some 10,000 TV series and movies will however be available on demand.

The service will be free with EE’s home broadband and landline packages, but will cost from £9.95 per month for EE mobile customers. Video content already makes up more than half of EE’s 4G mobile network activity, but at launch the service will be accessible solely in subscribers’ homes.

Watch this promo video for the service here:

Analysis: Late entry but new tech could win customers
Commenting on the move, Cesar Bachelet, Senior Analyst and Patrick Rusby, Analyst at Analysys Mason, said that EE could benefit from novel new technology but may be hampered by a lack of content.

“Although EE is a late entrant into the ‘classic’ triple-play market, the timing is good for a quad-play offer, ahead of the launch of consumer mobile services by BT. In spite of some ‘cool’ differentiating features, such as the ability to ‘flick’ content from a tablet to a TV screen, we expect the service to have limited appeal, due to the limited range of content it offers. We see EE mobile subscribers who are currently free-to-air TV viewers / low-end pay-TV subscribers as its main target audience. EE’s TV service will therefore grow the UK pay-TV market, rather than cannibalise other players’ TV propositions.”

Bachelet and Rusby offered the following points:

1. EE is a late entrant into the ‘classic’ triple-play market (TV, telephony + fixed broadband), but its timing is good for quad-play, ahead of the launch of consumer mobile services by incumbent telco BT

2. The service is similar to the YouView-based services already offered by BT and TalkTalk, however it does have a number of differentiating features such as the ability to record four programmes simultaneously, watching on four screens simultaneously, a 1TB DVR, 24 hour replay and a user friendly interface (which includes the ability to ‘flick’ content from a portable device to a TV), although the lack of a remote control (you use your smartphone or tablet to control the device) creates an obvious problem, and the lack of support for a second TV set may deter some users.

3. The most important aspect of any TV service is content, and here the EE TV proposition appears to be relatively weak. It offers Freeview channels, catch-up TV and a currently limited selection of OTT services. The new TV service aims to retain existing fixed subscribers, and also incentivise EE’s large mobile base to take up EE’s fixed services, rather than anyone else’s. However we don’t anticipate significant churn from established pay-TV operators, such as Sky, due to the relatively limited content offering. .

4. Looking to the future, when multi-screen video is available over 4G, EE will be well placed to offer converged multi-play bundles, including shared data and tablets, and additional OTT partnerships may sweeten the deal still further for customers.

Quad play is the ‘next big step’ for telcos

Dominic Baliszewski, telecoms expert at broadbandchoices.co.uk commented: “Quad-play really is the next big step for the telecoms market and is a continuation of the bundling revolution that has taken over since 2010. To date, we have mainly seen established fixed line/TV players adding mobile to their suite of services, but with the UK’s biggest mobile operator now adding TV to its products it will be interesting to see who makes a success of it first. Switching broadband, TV and landline phone services can save customers over £300 from their yearly household spend, so adding mobile to that bundle should bring even more savings in the long term.

“The pricing for EE TV is extremely competitive with EE home broadband and landline customers getting it completely free and EE mobile customers able to pay just £9.95 per month. Given that some people pay more than this for broadband alone, getting TV and broadband for just £9.95 (plus line rental of £15.75 per month) is a considerable temptation for mobile customers to switch all their services to the mobile giant.

“This quad-play launch clearly marks out EE’s intention to rival other major providers like Virgin Media or TalkTalk, and if BT also launch their own quad-play deal (as is rumoured), the pressure will be on for all of them to stake their claim on this emerging part of the UK telecoms market,” Baliszewski concluded.

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