Ben Shepherd, in his newsletter Three, with what you need to know in marketing and advertising.
This week: Exploring Hubbl, Nine nailing Stan and news subscriptions, $3-4m warchest for Kyle and Jackie O Melbourne invasion.
Inside the new Foxtel Hubbl box and what success looks like post launch
What’s new:
Foxtel launched a new entertainment box last week called Hubbl. It’s similar to Apple TV, the old Telstra TV (which was a rebadged Roku box) and the external Google TV products in that it provides one interface for all of your streaming products and also over the air free TV. The Hubbl box is a rebadged US product called Xumo, which is a Comcast product. Comcast owns Sky in the UK and has launched an integrated TV product (called Glass, which Foxtel will bring here) as well as the lighter box product in the US.
Why it matters:
External platform boxes have been around for over a decade but have become less prominent due to the integration of the same functionality into the TV themselves. We are quickly finding out that controlling the interface is generally the key for controlling the entire platform (see Google for browsers as an example, Apple for mobile) and those who control the interface (Samsing/Tizen, Vizio, Google, Roku) have a lot of leverage around who does and doesn’t achieve visibility on the home screen, and in exchange for this leverage are finding ways to generate a share of ad revenue and subscription revenue for services consumed via the TV. The business model behind a smart TV box is not predicated on the revenue generated from the sale of the hardware, it’s the consistent month-in month-out revenue from the clip of advertising from the services consumed. So for Foxtel this isn’t about becoming a hardware player, it’s about finding a way to get in on the new model of distribution. If it scales, it also gives Foxtel a reasonable chance at trying to piece together a bundle of streaming services and become a retailer of sorts.
Marketer implication:
The largest marketer implication here is the marketing task of getting a box like this into 2m plus households at a sticker price of $99 in a cost of living crisis when the majority of TV’s purchased in the last 5 years already aggregate these services. For Foxtel this adds another marketing challenge on top of sparking Kayo and Binge growth and maintaining levels of fixed line subscriptions. In that sense Foxtel has some of the hardest marketing challenges in Australia, and will be a marketer to watch as hard challenges generally create great work (by necessity)
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