MTN - Africa's largest cellphone operator - has joined the video-on-demand (VOD) space, but it will face an uphill battle to persuade the television viewing public to take advantage of its service in a dominated market.
MTN yesterday unveiled FrontRow, which will cost subscribers from R179 a month, or R399 a month including 10 gigs of data. The first content offering from a mobile operator promises subscribers "thousands" of movies and series episodes. Yet, the streaming, subscription only, service comes up against the likes of Times Media's Vidi, and Altech's Node.
Offerings can be watched via a browser, or an Android app, while an iOS app is in the works, says MTN. The operator initially expected to reveal its VOD service by the end of November, but testing of equipment required for the service is took longer than had been anticipated.
Launch offer
On the Web site, MTN notes the current price is a launch offer and, while users can connect up to five devices at the same time, they can only stream off one unit at a time. The service will allow users to connect to MTN's 3G or long-term evolution network via a device and watch movies or series episodes via a handset, and subscribers can also plug devices into a TV, MTN explains.
After the initial three-month launch period, the subscription price moves up to R199, or R499 for the data bundle. As part of the launch, the first 1 000 customers will get the first month free, but will still have to fork out for data costs.
After subscription, users can watch "thousands of films and TV series" as much as they like, as long as they are up to date with their subscriptions, notes MTN. However, new movies are only added about three months after release on the big screen.
For an extra R15 a movie, FrontRow subscribers can access FrontRow Premiere, which provides access to the "latest blockbuster films and more". This option gives subscribers two days to watch the entertainment of their choice.
However, once a subscriber depletes their data bundle, the normal data rate kicks in, says MTN. "You can then buy either another MTN FrontRow data bundle or a standard MTN Internet bundle. The MTN FrontRow data bundles don't have an associated out-of-bundle rate." FrontRow data bundles are only valid for 30 days and cannot be carried over.
Busy sector
Yet, IT veteran Adrian Schofield says MTN will have an uphill battle persuading those who are already using subscription TV services to move over. There are already a number of players in the market, including DStv - with about five million users - and new entrants such as Times Media's Vidi and Altech's Node offering.
In addition, MobileTV is set for launch soon via Sentech's satellite platform, and app makers such as Tuluntulu have entered the fray.
Schofield adds MTN will also come up against international offerings, such as YouTube and Netflix - which can be accessed in SA via a proxy - as well as other over-the-top (OTT) players. He notes most mobile operators have come out against OTT apps as these services eat into their bandwidth.
Moreover, notes Schofield, the bundle will not last long as streaming is data intensive, although the service could add to MTN's revenue. Operators have been battling dwindling top line income as voice use stagnates and data has yet to fill the gap. "One movie and you're done...no matter how they compress it."
Schofield adds the lack of network stability in SA is also a challenge, as consumers continue to complain about dropped calls and a lack of reception. However, he notes, operators have no choice but to move into the content sphere.
Vodacom has also been looking into providing content and, ITWeb understands, has been in talks with a provider. Operators will face many challenges to prove the worth of content services, notes Schofield.
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