Deal will see Telstra invest around $50 million including provision for onboarding Telstra TV customers onto Fetch.
Telstra announced it’s entered into an agreement with Fetch as its new platform for Telstra TV and to evolve Telstra’s home and entertainment proposition.
Fetch TV CEO Scott Lorson said Fetch has achieved scale and profitability on the back of a compelling proposition and distribution partnerships with leading Australian telcos and retailers.
Telstra bought a 51 per cent stake in the content aggregation company Fetch TV for $50 million, as it battles Google and Apple to dominate living rooms.
With Telstra on board, Fetch is now well placed to deliver a home and entertainment proposition with the scale to enable us to partner with global content and streaming providers.
Telstra TV currently operates on a platform provided by US equipment maker Roku, but the deal between the two companies is set to expire. Fetch is a long-term content provider for rival telcos including Optus and Vocus.
Telstra Group Product and Technology Director Kim Krogh Andersen said Telstra TV was launched in 2015 with a focus on connecting a broad range of streaming services to our customers, and currently has approximately 800,000 active subscribers operating on the Roku platform.
“Telstra TV has been successful and popular in Australian homes as it provides a simple way to discover and watch content from streaming services and free-to-air, and is a key platform for Foxtel streaming services, Kayo, Binge and Flash,” said Mr Krogh Andersen.
“While the current Telstra TV product remains popular, the underlying technology platform needs to evolve to support a deeper level of engagement through content offers, account management and rewards through Telstra Plus. It also needs to support future entertainment options and be delivered via the hardware options customers want including Smart TVs,” said Mr Krogh Andersen.
“After a strategic review of our options, we have selected Fetch TV for its ability to deliver this functionality at scale for our customers, given Fetch’s software development capability, innovative roadmap and strong track record delivering capability for other Australian telco partners.
“Becoming a trusted partner in the home remains an important growth opportunity for Telstra. As homes become more digitally connected, the integration of that technology – including the Smart Modem, smart meter and a platform for streaming media which can also be used for AR, VR and the metaverse – will become even more critical,” said Anderson
“While they all do different things, if they can work together seamlessly, it will help enable customers to get the most out of their connectivity. That’s why Telstra is investing in an ‘open’ technology platform and for us to have access to an onshore team who can deliver on a relevant product roadmap for Telstra and telcos,” he said.
Fetch TV currently has approximately 670,000 active subscribers through its Australian Retail Service Providers (RSP) relationships.
There are currently no plans to bring Foxtel’s Kayo Sports and Binge streaming services to the Fetch TV platform (Telstra TV customers currently have access to these apps). However, people close to the deal said it was something they would try to work out before Telstra TV passed.
History
Fetch was launched in Australia in 2008 by Malaysian telco Astro, which own 80 per cent of the business. It sells internet connected set-top boxes that give customers access to vast array of content, including from streaming services such as Netflix, YouTube and Amazon Prime Video (subscriptions to these services must still be purchased).
On 25 May 2010 Fetch TV announced they would begin offering their first generation set top box PVRs through partner iiNet. This featured three digital tuners to receive Australian terrestrial channels, as well as fourteen linear subscription channels and six Video on Demand based channels.
On 21 July they added five international news channels to the subscription channel package.
Fetch generated $10 million in earnings (before interest, tax, depreciation and amortisation) last financial year.
The transaction is subject to ACCC approval and other customary conditions precedent.
