Sky’s SoHo Surprise a Low Blow

The biggest surprise about Sky TV’s new HD channel wasn’t its premium content but its premium pricing.

Instead of bundling SoHo with its Platinum Movies package, Sky plans to charge all subscribers an extra $10 a month to receive the HBO-style channel from December.

Talk about making a sow’s ear out of a silk purse!

What on earth was Sky management thinking when it made this outrageous, shortsighted, cynical miscalculation to milk beyond belief the very subscribers who contributed to its annual profit of $120.3 million?

Launching SoHo was a chance for Sky to win over the sceptics and critics of pay-TV by saying, “We’re prepared to provide the kind of intelligent entertainment programming that free-to-air TV won’t.”

It could have been a glorious PR coup, delivering salvation to viewers fed up with FTA networks consigning quality drama to the scrapheap and showing Sky to be a good citizen broadcaster that had more than the bottom line as its benchmark.

Instead, by demanding a separate subscription for SoHo, Sky has jeopardised customer goodwill, heightened concerns about its digital TV dominance and tactical packaging of content, and risked cannibalising subscriptions for its other premium channels.

I certainly will be thinking about whether to continue my Platinum Movies package now that SoHo isn’t being bundled with it.

This has as much to do with affordability as time management: how much TV can I choose to watch in one week?

Adding SoHo to my monthly bill would see it top $150 – which is asking too much of subscribers in these recessionary times, particularly those who have supported Sky from the outset.

Sky has enriched the media landscape immensely, pioneering first digital TV, then PVRs and more recently HD TV, and for the most part given subscribers a good deal.

While sports fans might bemoan Sky gobbling up rights to all the major codes, the upside is far better coverage than FTA TV could have provided.

But early HD adopters have been left wanting, with only a handful of 1080i sport, movie and FTA channels since Sky went HD three years ago.

So have those subscribers desperate for content they can’t access on FTA and who desire more than simply second-tier channels stuffed largely with FTA re-runs (UK TV, Comedy Central, Vibe, The Box, BBC Knowledge) or cable-lite docos and reality TV.

Instead of stiffing these subscribers further, Sky should have made SoHo free to HD ticket holders or anyone with a Platinum package – just as BSkyB does with Sky Atlantic, on which SoHo is modelled, and Foxtel does with Showcase.

SoHo was a fantastic opportunity for Sky to reward HD customer loyalty and attract new subscribers who weren’t interested in its wall-to-wall sports or movies.

The latter strategy should succeed: as a $10 add-on for a basic subscription, SoHo is a bargain — and an example of how Sky needs to make its packages more flexible if it’s to build on its phenomenal 50% household penetration.

But if Sky were as serious about servicing discerning viewers as it claims, it would bundle channels like SoHo, Arts and Rialto in a unique package rather than charging extra for each.

In the case of SoHo, it’s hardly had to fight off competing bids to land HBO product.

Most of HBO’s content is too high-minded for FTA schedules and many of the series Sky has secured for SoHo, some through existing deals with other suppliers, will do double-duty on channels like Prime, The Box and UK TV.

So, given what SoHo offers in prestige and synergies, it’s not as if Sky’s had to pay a high price for the initiative.

Yet, for the time being at least, that’s what it’s demanding of HD subscribers — and it’s not a happy place to be.

 

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11 Responses to “Sky’s SoHo Surprise a Low Blow”

  1. I cut the Sky cord a year ago from this money grabbing lot. Increasing the price every year while only adding crap channels which I didn’t want. If they made an a la carte system of programming available I may go back …

  2. Phil, you are so right. But I disagree with putting SoHo into Platinum Movies package. It should be in the Basic package. After all, it’s on channel 010. Sky’s annual profit of $120.3 million tells me they are milking it. Tell Sky to reward their subscribers who have helped them through tough times when there are a lot of industries struggling.

  3. Sky has no competition in New Zealand, and the current government is not interesting in regulating it. So they’ll continue to charge whatever they like, and play whatever they like, until that situation changes.

  4. I would feel let down by this if I hadn’t already watched all of these shows through other avenues. When will broadcasters learn that people are not interested in watching shows years after they first air, you’re completely removed from the cultural zeitgeist. If they committed to airing new episodes of these HBO shows no later than a week after release, then maybe I could suck up the extra charge but otherwise, no thanks. As far as I can tell, we’ll still be waiting months before new episodes make it to ‘SoHo’.

  5. I was quite excited when I heard about SoHo, and gave serious consideration to signing up to Sky (for the first time in many years). However, when I calculated how much it would cost me to watch these shows, with every extra option adding $10-$20, and with a final $10 cherry on top for SoHo alone, it was getting a little hard to justify. That extra $10 for just one channel really pushed it over the top.

  6. SoHo is just rebranded HBO, which is also a pay per view channel in the US. Why should it be part of the Sky Platinum? That means I have to pay for crap repetitive movie channels to get a channel with good content. $10/Mo is alright for SoHo, and what I expected considering it’s ad-free. I heard SoHo will air shows only like two days or so after airing in the US. If this is the case, I will be getting SoHo. I guess we’ve got the first month to find out.

  7. As a $10 monthly option for Basic subscribers, SoHo is a FANTASTIC deal. But my beef is Sky’s failure to reward the loyalty of its early HD adopters by not bundling SoHo with the HD Movies or Sports packages. By all means offer it as a stand-alone option for Basic subscribers who want SoHo and not the other Premium channels. But Platinum (or Premium) customers should not have to pay extra for it. If BSkyB and Foxtel can include their versions of SoHo in Premium bundles, why not Sky?

  8. I agree with you, Philip. I have been a Sky subsciber paying a premium for HD content for years. The least they could do is heavily discount SoHo to Sky Movies subscribers. I have just cancelled Sky Sport to help pay for SoHo. If the time the movies get to the Sky Movies doesn’t improve, I may give that up as well. I feel that the movies available on pay-per-view and on-demand is about the right timing for the movies to appear on the Sky Movies channels. I signed up for SoHo already for December as a supporter for the content (won’t need to get downloads from my friends).

  9. I agree. The new Soho channel should have been included in the movie package deal currently offered, e.g. Rialto and TCM. It is a shame that Sky does not seem to have new movies introduced each month. Some movies seem to be on for two months and UKTV one of my favourite channels keep screening the same episodes over and over again. I sometimes wonder whether the money I pay is worth it. The sports channel is too expensive for constant replays, and now an extra $9 etc (almost $10) for SoHo is a greedy move. Sky should rethink the Cartoon Network channel they offer because I think it is too violent for young children. Do away with some of the channels for kids and make SoHo inclusive with other HD movie or sport channels.

  10. Nice channel, but pay another $10 per month!! No way. How about $3 or $4 instead.

  11. I love it so ended my movies package and got it instead- upside for me is its half of what I use to pay! Downside for Sky………

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