Sky Deutschland, the German arm of pan-European pay TV operator Sky, has acquired Swiss online-video provider Homedia, which operates under the HollyStar brand. The value of the deal was not disclosed.
Launched as DVD rental service DVDfly in 2004, HollyStar now offers access to more than 10,000 movies and TV shows on a subscription, rental and EST basis. The subscription offering is priced at CHF9.90 ($10.10) per month. As well as being available as a standalone app via PCs, smart TVs, games consoles, and iOS and Android devices, HollyStar is distributed via aggregated pay services, including IPTV platform Sunrise and virtual pay TV offering Teleboy.
Homedia created the separate corporate entities Homedia France SAS and Homedia Belgium SA in 2006 and in 2008 respectively to address the French and Benelux markets, where the businesses still exist as DVD rental services. Neither of these operations is part of Sky’s takeover.
The acquisition of a significant online-video asset in Switzerland, and the rights catalogue that comes with it, signals Sky’s intention to become a more comprehensive TV provider in market. It does not operate a full pay TV platform there, to date only providing content through wholesale distribution – Teleclub, the pay TV subsidiary of incumbent telco Swisscom, offers a handful of Sky channels through either additional subscription packages for cable and IPTV customers, or Sky-branded packages delivered to Sky-branded digital receivers (set-top boxes or CI Plus modules). None of these services include access to on-demand content via services such as Sky Go and Sky Select, as Sky does not have the appropriate rights in Switzerland, and the operator has not rolled out its pay TV lite online subscription service Sky Ticket in the market.
Given Sky’s experience in successfully selling TV content and services in Germany and Austria, an expansion strategy for German-speaking Switzerland is logical, particularly in the online space, which has been the source of much of the company’s recent growth. Homedia’s reach via a range of devices and services gives Sky a solid foundation on which to build – there is certainly potential for the operator to use HollyStar as the basis for a broader pay TV lite offering, one that will better compete with the international subscription video giants Netflix and newly launched Amazon Prime Video.
A transition to the Sky brand appears highly likely, with Sky informing Swiss consumers, via a marketing webpage, of its forthcoming arrival as a service provider. The operator has not provided any details on the nature of this offering, but IHS Markit believes it is more likely to be a flexible virtual pay TV service, a la Sky Ticket, than a ‘full fat’ traditional pay TV offering that would compete head-on with dominant providers UPC and Swisscom in what is a mature market.
In the context of Sky’s broader strategy, the acquisition of Homedia is significant as it comes after the operator made another new foray into standalone online video, launching OnPrime TV with long-time technology partner Cisco in March. Targeting non-European expatriate communities living in Europe with Arabic, South Asian and Russian content, the service is available in the UK, Germany and Italy, with expansion into other European markets planned for 2017.