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Netflix launches TV battle royale

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With this week’s launch of Netflix Australia, the lines have been drawn for a television streaming battle royale that’s been years in the making.

At 6.30pm on Monday, a friendly reminder landed in my inbox from Stan (Fairfax and Nine’s streaming service): “Don’t forget, when you sign up to Stan you have access to our entire library and can watch all your favourite TV shows & movies on up to 3 screens at the same time and remember we have thousands of hours of content available in full HD.”

Why did Stan feel the need to remind of what I signed up for back in January with my $10 a month?

Netflix had just announced its pricing structure for Australia, featuring a “basic” package for $8.99 a month which doesn’t allow you to stream on multiple screens or stream in HD. To stream on two devices in HD, you need to purchase the “standard” package for $11.99 or the “premium” package for $14.99 for four screens. Message received, Stan.

But the battle for my loyalty and affection (and the loyalty and affection of Australian viewers) has only just begun. The prestige of the Netflix brand (to which 36 per cent of US households subscribe) will undoubtedly have a huge impact as the services and audiences align over the next year, but it won’t necessarily eclipse all other players – Australian audiences have a very different relationship to TV services than their US counterparts.

For almost two decades, Foxtel has been the only major player in Australia’s relatively small pay-TV market, but with more reliable internet speeds viewers have, over the last several years, started to demand services comparable to what’s on offer elsewhere in the world. Foxtel has adjusted its business model substantially – including a recent price slash – to remain competitive in a market that now has real competition. But it’s about to face its biggest test.

The new streaming services are designed to be as cost-effective and convenient as possible, removing the temptation to illegally download.

While the local launch of US streaming giant Netflix had been rumoured for years, it was actually Foxtel that made the first major move into the on-demand streaming space with Prestoin March 2014. Its initial offering was small, to say the least, and included only movies for $19.99 a month.

Of course, anybody who was familiar with Netflix’s movies and television package for $7.99 understood just how much Australian customers were being slugged and by August the cost was slashed to $9.99 a month. And then in January, with both Netflix and Stan on the horizon, Presto introduced television to its service (but for an additional $4.99 a month).

While Presto has access to much of Foxtel’s local and international content (including some of HBO’s high-profile series, including Girls), Stan picked up the Australian rights to Better Call Saul, a decent library of local content and Amazon Prime’s Transparent. Netflix is launching with high-profile Netflix original series including Orange is the New Black and House of Cards.

The current shift is a natural progression away from broadcast to a more viewer-friendly on-demand system, but it can also be understood as the international TV industry’s first attempt to tackle piracy in Australia and wean a small but devoted marketplace off its growing appetite for torrents and illegal streaming sites.

Australia famously led the world in illegally downloading the last series of Game of Thrones (below) when Foxtel held the exclusive rights, preventing iTunes or other services from selling the series until it had finished airing on Foxtel. The new streaming services are designed to be as cost-effective and convenient as possible, removing the temptation to illegally download.

Game-of-Thrones-Netflix

So which of the three is best, as a consumer? Well, at this point it’s pretty difficult to say and depends entirely on what specific content you personally want. They’re all relatively comparable in terms of price, all have decent libraries (although still substantially smaller than Netflix US), which we’re promised will continue to grow, and they all work with similar technology (although the Netflix service is, according to tech experts, more reliable and its interface more intuitive).

What is certain is that it will all come down to the content available, and the balance will continue to shift as rights are negotiated and re-negotiated.

While we’re used to our free-to-air TV networks competing against each other for the rights to lucrative international properties, the competition between streaming services could be even more ferocious because a single must-see series could be enough to attract viewers to a particular service (and away from another).

The situation is slightly different from the US, where Netflix dominates the streaming market. So, given the competition, will consumers be the ultimate winners?

It’s still early days in the brave new world of streaming, but the offerings are already a substantial step up on what was available a few years ago – if you’re a TV addict, you may find yourself signing up to multiple services, but it will still work out cheaper than Foxtel. (Of course, if you’re a sports buff, it will still be a while yet before you can bid Foxtel farewell.)

But within the next few years, other services could launch (or Quickflix could become a bigger player) and change the balance almost immediately. There’s the possibility that HBO could look at slowly moving away from distributing its rights to local services and launch HBO Go in Australia, putting another major cat amongst the pigeons.

Who knows what will happen or who will come out on top? Thank god none of the services have lock-in contracts.

This article was first published on The Daily Review.

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