Vodafone Launches Virtual Pay TV Service in Greece

Publication date: 24 Sep 2018 Author: Irina Kornilova Manager, Research and Analysis, Broadband Media

Vodafone launches virtual pay TV service in Greece

Brought to you by Informa Tech Vodafone launches virtual pay TV service in 1 Greece

Vodafone has launched a new standalone online subscription video service in Greece, called Vodafone TV. The service is available to everyone with a broadband connection, including customers who do not subscribe to mobile or fixed broadband services provided by Vodafone. The service will offer a total of 62 linear channels, 4,000 library movies and 7,000 episodes of TV series, with the most recent blockbuster movies being subject to a rental fee. Vodafone TV is available to all devices that support iOS and Android, and provides the subscriber with the ability to simultaneously use up to three connected or mobile devices per account. The service also offers a Cloud DVR option, allowing consumers to save and store content in the cloud. Vodafone TV offers its subscribers the choice of three packages. These include a basic package, Vodafone TV Family, costing €11.90 per month, and two higher-tiered offerings, Vodafone TV Entertainment + Sports (at €19.40 per month) and Vodafone TV Full (€21.90 per month). Our Analysis

Vodafone’s pay TV strategy seems to have taken a more dynamic twist in the last 12 months. Vodafone entered the pay TV business in Greece back in 2014 when it acquired the telecom operator Hellas On Line (HOL) and its IPTV service myHOL TV for a total sum of €72.7 million ($96.6 million). Since then, the IPTV service, which was renamed to Vodafone TV in 2015, was mainly positioned as an add-on to Vodafone's core mobile, and fixed broadband and telephony business. However, in September 2017 Vodafone inked a deal with pay TV operator Nova for carriage rights for six Nova Sports channels, and in January 2018 acquired the Greek operations of Cypriot telco CYTA (which also included an IPTV service). The growth strategy of Vodafone is two-prong. A large part of this is based on acquisitional growth, as the cases of HOL and CYTA indicate. Vodafone's recent joint-bid with WIND for the potential acquisition of Forthnet provides further evidence of inorganic growth strategy. At the same time, the telco is clearly focusing also on promoting organic growth for the near future. This is testified by the deal with Nova, since a solid sports portfolio is an important driver of growth in the Greek market. The launch of the standalone OTT service, Vodafone TV, provides yet another clue on the direction of Vodafone’s strategy in respect to TV. Despite the potential for cannibalisation of Vodafone's own IPTV service, IHS Markit believe the operator has launched an OTT service for the following reasons: . To target a wider audience: On a price-sensitive market like the crisis-torn Greece, online subscription services are more affordable for the average consumer than “traditional” pay TV. A further advantage for online subscription services is tax savings, with the Greek government's 2016 law imposing a 10% tax on pay TV services not applying to online subscription services. . To provide a flexible option for consumers. The freedom to subscribe and unsubscribe to OTT services on a monthly basis appeals more to some customers when compared to 12 month contracts offered by pay TV. . To exploit and monetize big investment in mobile and fixed broadband infrastructure: Vodafone has started implementing a fiber (FTTH) roll-out project which will cost €500 million for the next

two and a half years. At the same time, the telco is investing a further €250 million to extend its own 4G LTE network all over Greece. The potential for increases in footprint from these investments will provide an opportunity for Vodafone to introduce its TV brand to new customers. Or, alternatively, by expanding its infrastructure, Vodafone could upsell TV customers to its internet and mobile services.

Vodafone is the fourth local operator to launch OTT in Greece. The first was FTA broadcaster Antenna Group, which launched the Ant1 Next streaming service back in 2017, offering exclusive content from scripted programming controlled by Antenna Group. Then in 2018, mobile telco WIND launched its WIND Vision service, and telco and pay TV operator Cosmote launched Cosmote TV Go. Citation policy Request external citation and usage of Omdia research and data via [email protected]. Omdia consulting We hope that this analysis will help you make informed and imaginative business decisions. If you have further requirements, Omdia’s consulting team may be able to help you. For more information about Omdia’s consulting capabilities, please contact us directly at [email protected]. Copyright notice and disclaimer The Omdia research, data and information referenced herein (the “Omdia Materials”) are the copyrighted property of Informa Tech and its subsidiaries or affiliates (together “Informa Tech”) and represent data, research, opinions or viewpoints published by Informa Tech, and are not representations of fact. The Omdia Materials reflect information and opinions from the original publication date and not from the date of this document. The information and opinions expressed in the Omdia Materials are subject to change without notice and Informa Tech does not have any duty or responsibility to update the Omdia Materials or this publication as a result. Omdia Materials are delivered on an “as-is” and “as-available” basis. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained in Omdia Materials. To the maximum extent permitted by law, Informa Tech and its affiliates, officers, directors, employees and agents, disclaim any liability (including, without limitation, any liability arising from fault or negligence) as to the accuracy or completeness or use of the Omdia Materials. Informa Tech will not, under any circumstance whatsoever, be liable for any trading, investment, commercial or other decisions based on or made in reliance of the Omdia Materials.