Swedish cable company Com Hem is to add Netflix video streaming services to its forthcoming TiVo set-top box. Officially TiVo goes live on the 7th of October 2013, with Netflix available from December. Com Hem is the second European operator to bring Netflix services to the TiVo platform, and follows closely in the footsteps of the UK's Virgin Media.
Customers will be able to access TiVo via Com Hem for a monthly fee of SEK149 (€17), and will require a separate subscription to Netflix (although this can be initiated via the TiVo box). Aside from the 12,000 titles in Com Hem's own video-on-demand catalogue and Netflix's offering, customers will be able to view content from the yet-to-launch UK-based on demand service Cirkus, C More Play and Viasat Film - providing they have the appropriate subscription.
Alongside the launch of TiVo, Com Hem is also debuting its TiVo-branded multiscreen service 'TiVoToGo', which is available across different devices including PCs, mobile phones and tablets. Initially TiVoToGo is available on iOS phones and tablets, with Android devices to be added soon. Company claims 45,000 preregistered customers for the TiVo service since May 15, 2013.
Com Hem's partnership with Netflix follows the same trend started by Virgin Media and Netflix in the UK in September 2013. The partnership demonstrates the increasing willingness of pay TV operators to add complementary services to their propositions and further outlines Netflix's strategy to position itself not just as separate online video platform competing with pay TV operators but as a content aggregator open to creating synergistic partnerships with market incumbents.
The partnership with an established pay TV player on the Swedish market gives Netflix obvious benefits. Netflix gets access to a vast customer base that is ready to pay for video services. In Q2 2013 Com Hem had over 600,000 digital TV customers and a further 1.2 million analogue TV subscribers. In addition to gaining access to those of Com Hem's nearly 2 million customers who choose to upgrade to TiVo, Netflix will benefit from full integration into the TiVo platform and its search functionality - ensuring that its content and service offering will be obvious to TiVo subscribers. Collaboration in joint marketing campaigns may also help Netflix control its marketing spend, which has traditionally been a significant component of the online video player's cost-base.
For Com Hem the partnership with Netflix is also important. As with Virgin Media in the UK, Netflix complements Com Hem's existing video content services with its movie catalogue and with its original TV series such as House of Cards, Arrested Development and others. However, Com Hem has gone a step further than Virgin Media, with a wider range of third party video services supported - customers will be able to gain access to vast quantities of premium on-demand content through C More, Viasat and Netflix, all via their Com Hem service. These brands will help Com Hem market its new TiVo service, and just as importantly help to improve upsell of the large analogue subscriber base to digital TV services. The only losers from the move will likely be the rival pay TV services in Sweden, which will have to act quickly to emulate the new Com Hem proposition, or risk losing further ground to a rival offering a sophisticated device and UI, comprehensive premium content offer and multi-device service.