EXCLUSIVE: Confirmed Amazon Prime To Take On Netflix Q1 2017 In OZ
Amazon Prime Video will launch in Australia in the second quarter of 2017 according to local sources, however the battle will be all about content and the rights that both Stan and Presto already own in the Australian market.
According to Scott Lorson the CEO of Fetch TV Amazon is tipped to launch sooner that the second quarter 2017, roll out that was initially planned by the US giant with mid to late December tipped as the launch date.
One senior executive at Foxtel said “they have seen the numbers that Netflix are delivering and they want a share of this market”.
Scott Lorson said that Fetch TV has already taken moves to engage with the US content Company that goes head to head with Netflix in several global markets including the USA, Canada and the UK.
“We know that they are coming, it will be tougher for them here. We will put them on our platform, we have already reached out to them as we see it as a good thing”. He said.
“Everyone in the industry knows that they are coming. They have not started buying content yet for the Australian market” Lorson added.
The challenge they will have is that even their own shows like Mozart in the Jungle have already been licensed to Stan. This is exactly what happened to Netflix, for example Orange is The New Black which is a Netflix show is still on Netflix”.
Earlier this week it was revealed that Netflix now has nearly 5 million viewers, with competitors Stan and Presto well behind.
After launching 14 months ago the US streaming giant now has 1,878,000 households subscribing to its service, including paid, free trials and special offers from third parties, according to Roy Morgan Research.
By comparison, Stan has 891,000 viewers (332,000 subscriptions) while Presto has 353,000 viewers and 142,000 subscriptions.
What makes the comparison attractive to Amazon Prime is that 92% of Netflix subscriptions are paid and 7% free, compared to Stan with 78% paid and 21% free and Stan with 64% paid subscriptions and 35% free.
According to Roy Morgan, many subscribers also add a second SVOD service, with 75% of Stan subscribers also having Netflix.
Motley Fool said that part of the appeal of the SVOD services is that unlike Pay TV (Foxtel), there are no lock-in contracts. The other big driver is cost. For virtually the same price as adding Foxtel’s movies package (usually $25 a month), households can subscribe to both Netflix and another SVOD service – and have the advantage of no contracts.
It;s expected that Stan and Presto could come under pressure with the possibility that consumers could gravitate to a combination of Netflix and Amazon Prime.
Motley Fool said that the impact of Netflix and to a lesser extent, Presto and Stan, is also visible on the free-to-air broadcasters, Seven, Nine and Ten Network Holdings Ltd (ASX: TEN). As much as the three commercial networks like to crow about their ‘growing market share’, the fact remains that their total audience is shrinking as more and more consumers switch off from commercial TV, or watch much less of it.
Several observers have said that there is room for more than one SVOD service in Australia, as the high percentage of dual Stan/Netflix subscribers show. The problems for free-to-air and pay TV operators are only just beginning.