Forum Archive Index - January 2001

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

>  
>I purchased some SKY late last year at $2.80 about the
>time that Telstra Saturn and TVNZ signed their MOU.
>
>One of my reasons for purchasing is that I am of the belief 
>that NZ cannot sustain 2 digital TV suppliers and therefore SKY
>will need to be brought on board some time so that its set top
>boxes can be used for the transmission of the Telstra 
>Saturn/TVNZ service (should this eventuate).  I was interested to 
>read when back home at Christmas a response by a senior TVNZ. 
>What are your or other chatters thoughts on this?
>
I think, Charlie, that two digital TV suppliers are very much 
sustainable.   In the mid 1980s when Ansett arrived in New Zealand 
the catch cry was that there is no room for two domestic airlines.   
Yet the idea of one domestic airline, now the market has expanded so 
much, seems an absurdity now.  

I predict that in the evolving and growing 'digital communications' 
sector, we will have Telstra/Saturn on one side of the ring squaring 
off against Telecom/INL/Sky in the opposite corner.  And if you think 
that SKY TV with all the cricket and rugby sewn up and as the 
incumbent 'market leader' is going to be easily rolled, think again.

I think that there may well be some competitive 'mud slinging', but 
in the end people will settle for no more than one box on top of 
their existing TV set.   I think consumer pressure will make sure 
that any transmission network is shared.   To use the airline 
analogy, consumers wouldn't tolerate Qantas NZ and Air NZ splitting 
the skies between them and each airline only flying in their own 
'half'.   This time the government will legislate and we will have 
one network with at least two 'TV wave' carriers, and maybe a few 
'niche' ones too.  There is no reason that you can't have two (or 
more) financially independent teams on the same playing field

TVNZ isn't going to be sold off, but isn't going to be fed the cash 
to do any bidding for anything else either, so I think you can rule 
them out of the equation.

As I understand it, Sky TV makes no money as yet, so the question 
must be asked 'is it a good investment'?    To me INL seems a less 
risky way of climbing aboard this particular train, and perhaps 
buying into the whole operation by buying Telecom is less risky 
again....or would be if Telecom didn't have a huge cash issue 
(which they haven't announced yet) coming up.   

That Telecom cash issue is speculation on my part. But with banks 
going shy on this sector and their rumoured Japanese partner in the 
conquest of Australian 'telecommunicationspace' perhaps having second 
thoughts, I see no way out other than a cash issue for Telecom NZ.   
So I'd be looking to enter this sector at the cheapest point, through 
the Telecom cash issue ,rather than gambling on SKY TV directly.
SNOOPY

PS And now Charlie, since I have given you such a long and detailed 
answer, perhaps you would do something for me?  Please stop posting 
exclusively in HTML!   I think your posts are good enough to stand on 
their own without any dubious textural enhancements.



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