Tag: bundling

By Thinus Ferreira for News24

South Africa’s Competition Commission has started an investigation into MultiChoice that has announced plans to add global streaming services like Netflix and Amazon Prime Video alongside its own Showmax service.

In its latest financial year results announced in mid-June, MultiChoice revealed that it plans to add Netflix and Amazon Prime Video as subscription video-on-demand (SVOD) services to a new streaming app carousel that it wants to launch for DStv subscribers.

This new streaming app vertical will house separate blocks or apps, incorporating DStv Now, Showmax, Joox, Netflix, Amazon Prime Video – and in future even more global streaming services like possibly Disney+, HBO Max, Spotify and others – as MultiChoice evolves to become what in the pay-TV industry is termed a “super-aggregator” of video content.

How it will work, and already works elsewhere in the world, is that consumers can still subscribe separately and directly with these streaming services, but can also do so through their traditional pay-TV service that gives access to their rivals in win-win “frenemy” content distribution agreements.

MultiChoice wants to provide DStv subscribers who sign up for one or more of these SVOD services – for however long – the convenience of one monthly bill paid in rand and the streaming service amount(s) just showing up as an additional invoice line-item.

How MultiChoice benefits is that by offering DStv subscribers seamless access to streaming service competitors but through its interface and platform, MultiChoice gets to keep a DStv subscriber within its own eco-system. MultiChoice also gets paid a commission by a SVOD service for every subscriber who signs up to each of these services.

How the pay-TV subscriber benefits is that the tacked-on streaming service subscription, paid in local currency, is usually a bit cheaper than going direct as part of a promotion to entice them to try and use it, and because the pay-TV operator because of scale gets a “wholesale” price.

The streaming service benefits by getting additional revenue and new subscribers through leveraging the scale of the pay-TV operator and piggybacking on the more trusted local brand. It lowers what is called “product friction” – potential customers to scared to try something new or unwilling to complete a new registration and sign-up and cumbersome login process.

Traditional pay-TV operators in the United States like Comcast, in the United Kingdom like Sky, Canal+ in France and several others worldwide have already taken the leap to integrate and offer streaming services like Netflix, Disney+, HBO Max and others that are actually competitors, into their existing services and making them available through their platforms and user interfaces.

MultiChoice plans to take the wrapping off its latest DStv Explora decoder next Wednesday in a media launch that it will broadcast on one of its own DStv channels, with the decoder that will likely be 4K-resolution capable.

It will likely also come with a DStv remote control that will have a dedicated Netflix or video streaming button, similar to elsewhere in the world, taking DStv subscribers directly to the streaming app carousel where DStv Now, Showmax, Netflix, Amazon Prime Video and future streaming services will all appear stacked next to each other.

It’s unclear how the new Competition Commission investigation might scupper or alter MultiChoice’s showcase plans for next week.

MultiChoice was asked for comment regarding the Competition Commission investigation into MultiChoice’s SVOD expansion plans, and how the investigation will impact the Randburg-based pay-TV operator’s plans for the consumer roll-out of these rival services on its platform.

Joe Heshu, MultiChoice’s group executive for corporate affairs, told Channel24 on Wednesday in response to the media enquiry that MultiChoice is unable to comment at this stage.

Siyabulela Makunga, Competition Commission spokesperson, told Channel24 about its investigation of MultiChoice wanting to add Netflix and Amazon Prime Video that “we’re not commenting on the issue because it is still at a very sensitive stage”.

He couldn’t say when the investigation started, or when it might be finished. “It’s still very early,” he said.

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By Jillian D’Onfro for CNBC

In response to the European Union’s $5 billion antitrust ruling in July, Google will change how it bundles its apps on Android phones and charge a licensing fee for phone makers that want to pre-install apps like Gmail, Maps and YouTube in the EU.

Google will also end restrictions on phone makers selling modified or “forked” versions of the mobile operating system.

Previously, Google tied together a suite of 11 different apps that phone makers would have to pre-install if they wanted to license its app store, Play. In July, the EU ruled that this bundling was anti-competitive — pushing consumers toward Google’s search engine and weakening rival app makers — though it only specifically called for Google to separate Chrome and Search from Play.

In response, Google said in a blog post on Tuesday that it will start offering separate licenses for Search and Chrome, as well as a license for its suite of apps like Maps, Gmail and Docs. That means that if phone makers want to pre-install those apps, they will have to pay a fee, though the amount was not specified. Google says the new licensing fee will offset revenue lost through compliance efforts that it uses to fund the development of Android, which it offers as a free, open source platform. The licenses for Search and Chrome will not have a fee.

Although Google doesn’t make money from Android directly, it generates advertising revenue through search as well as Chrome, Maps and Gmail, serving ads within those apps and using data it collects from users to better target ads across its platforms.

“Since the pre-installation of Google Search and Chrome together with our other apps helped us fund the development and free distribution of Android, we will introduce a new paid licensing agreement for smartphones and tablets shipped into the EEA [European Economic Area],” wrote Hiroshi Lockheimer, Google’s vice president of platforms.

Google’s previous agreements with phone makers also prevented them from selling modified versions of Android if they wanted to use its suite of apps, but the company will now allow manufacturers to build forked smartphones and tablets for the EEA.

Overall, Google’s Android powers more than 80 percent of the world’s smartphones. These changes, which will come into effect on Oct. 29, will only affect phones for the EEA, a group consisting of 28 EU countries, plus Iceland, Liechtenstein and Norway.

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