Market Insight

BSkyB acquires Acetrax

May 07, 2012

Irina Kornilova Irina Kornilova Manager – Research & Analysis, Broadband Media, IHS Markit

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UK satellite operator BSkyB has purchased Swiss-based transactional online movie service Acetrax, it was revealed in the pay-TV operator's first quarter 2012 results. The Acetrax app is built into LG, Samsung and Panasonic TVs and BD players, Toshiba TVs and tablets, Philips TVs, and the Emtec movie cube. Acetrax has content deals with Paramount Pictures, Warner Bros, Sony Pictures, Universal Pictures, as well as Momentum, Diva, Constantin, MK2, and music companies Eagle Rock and Charly Films.

Acetrax is available in Austria, Ireland, Italy, France, Germany, Liechtenstein, Switzerland, and UK. It is understood that Acetrax will continue to operate under its own brand name and Sky will repurpose the Acetrax platform for its own OTT needs, seeing the acquisition as a move to support the development of Sky's OTT activities in the connected device environment. 

Acetrax's most important asset for BSkyB is the set of relationships which it maintains with CE manufacturers and the Acetrax software's integration with a range of platforms, including connected TVs, BD players, tablets, and of course, PCs and laptops.

BSkyB already delivers its current OTT service, Sky Go, to the Xbox 360 and iOS and Android mobile devices, but so far hasn't developed deals with connected TV manufacturers. Following the launch of Sky Go, BSkyB indicated that it was not ready to launch on connected TVs due to a lack of compelling propositions from CE manufacturers, but it made it clear that the possibility was not going to be completely discounted in the future.

The acquisition of Acetrax will ease the integration of BSkyB's OTT services into the connected TV environment. Acetrax's expertise is planned to complement not only expanding Sky Go activities (with an estimated 14m iOS, Android, PC and Xbox 360 devices owned by Sky customers by 2014), but also Sky's new standalone OTT initiative Now TV, which is planned for launch by the end of June. Now TV is an especially important move for BSkyB - a departure from traditional strategy of reinforcing the core pay-TV subscription, Now TV will complement the existing OTT offer and help to reach audiences who don't have (or don't want) a Sky pay TV subscription, as well as competing with standalone online video services from Netflix and Lovefilm. Now TV will provide Sky-acquired content (initially movies, with an expansion to sport and general entertainment) on both a subscription and transactional basis. Sky intends that Now TV will be available on a wide range of connected devices and Acetrax will provide a solid backbone to supply the promised range of devices for the new service. This will also be a serious boon for competition with Netflix (which is available only on Samsung TVs so far) and Lovefilm (which maintains deals with Sony, Samsung, LG and Cello TVs).

In the past, Sky has used KIT Digital to develop its online services, but bringing core technology/infrastructure costs in-house is a strategy which Sky has long used, for instance with the purchase of ISP Easynet and device manufacturer Amstrad. The fact that Sky has acquired Acetrax is a clear indicator that Sky recognises that connected devices are now increasingly core to its business. IHS Screen Digest forecasts the number of active directly connected TVs to more than double in 2012 in UK. By 2015 the number of active connected TVs present in UK homes is expected to easily pass all other connected devices, including games consoles, set-top boxes and BD players.

Geography
UK
Organization
Acetrax Sky
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