Vodafone has entered the Australian streaming market with the launch of its Vodafone TV device. The Android TV-powered set-top box is the company’s first-ever streaming media device which provides access to popular content and services such as Netflix, Google Play Movies and YouTube. The device also features 4K compatible high definition resolution, Google voice-search functionality, integrated free-to-air TV tuner and Dual-band Wi-Fi receiver. Vodafone TV may be added to an existing contract for A$5 ($3.80) per month over 24 months or purchased outright for A$120 ($91) in-store.
The launch of Vodafone TV coincides with the company’s announcement of a three-month promotional partnership with Netflix. Until 30 June 2018, Vodafone will offer customers a complimentary 12-month standard subscription to Netflix on its 24-month Essential Plus and Premium broadband internet plans. The Netflix offer is available to existing and new customers and the subscription must be redeemed by 31 August 2018.
Vodafone also plans to expand its Vodafone National Broadband Network (NBN) service and consolidate its broadband service plans during April 2018. Following the December 2017 launch of its broadband service in Canberra, Geelong, Melbourne, Newcastle, Sydney and Wollongong, the company is nearly doubling its NBN footprint. From April 2018, Adelaide, Brisbane, Gold Coast, Perth and Tasmania will also be able to connect to Vodafone NBN. The new consolidated plans are Vodafone Basic, Vodafone Essential Plus and Vodafone Premium, which range from A$59 ($45) to A$99 ($75). The revamped NBN plans provide Vodafone customers with high speed internet at a lower price point, with the average price of plans declining by around A$10 ($7.60) per month.
Vodafone TV enters an already highly competitive Australian streaming market. Vodafone TV will compete with offerings from rival telcos such as Telstra TV and Optus Fetch, as well as services from smart TV platforms such as Apple TV and Amazon’s Firestick. Vodafone hopes its open platform approach, partnership with Netflix and competitive price point will propel its Vodafone TV device into Australian homes.
Vodafone’s deal with Netflix is not uncommon in the Australian streaming device market, with Telstra and Optus already having partnerships in place. In particular, Optus was Netflix’s chosen launch partner when the global video giant launched in Australia during March 2015. Similarly, a partnership exists between IPTV pay TV operator Fetch TV and Netflix in Australia.
It is Vodafone TV’s open platform approach which will determine the success of the device in the Australian streaming market. There is a sufficient gap in the market for Vodafone to launch a platform allowing access to a wide range of content, and if customers embrace the concept then the device will likely gain traction in the market. Vodafone's openness to multiple content providers is in contrast to many of its competitors, which are buying specific content rights and leveraging exclusive access to the content, such as Optus securing rights to English Premier League (EPL) matches in Australia.
To further entice customers, the price of a Vodafone TV device is A$70 ($53) less than the price of its major competitor’s device, Telstra’s TV2 box. However, although a lower price will appeal to customers, Vodafone risks placing too much downward pressure on revenue, if it tries to compete solely on price across its suite of products.
Meanwhile, Vodafone’s broadband expansion is welcome news for customers and the company alike. Consumers will benefit from the increase in competition which will not only result in cheaper plans but is likely to drive better deals around length of contracts and data allowances. The company also stands to benefit from broader coverage across Australia, which will widen its potential customer base and help scale up revenue.