Sky Network deal with TVNZ to boost audiences for TV6 and 7

Thursday 26th March 2009

Television New Zealand, the state-owned broadcaster, reached an agreement with Sky Network Television that will expose its minority stations, TV6 and TV7 to the pay-TV company's approximately 600,000 set-top box users.

Launched at the same time as TVNZ's joint venture digital Freeview offering, the government-funded TVs 6 and 7 were used initially to differentiate and make more appealing the free-to-air digital service, which offers 14 channels to Sky's more than 100 channels. They are part of a wider push by broadcasters to move viewers off analogue and onto digital viewing platforms.

Sky reaches more than two million New Zealanders through its approximately 760,000 subscribers, none of whom can currently receive TVs 6 or 7 through Sky. The change will be a major boost in the potential audience for the two channels, which are part of TVNZ's "digital and emerging business" group, along with Freeview. This part of the TVNZ business was untouched in the recent restructuring because of its assumed growth potential.

Some 123,000 Freeview receivers were installed at June 2008, representing 7.8% of New Zealand homes. Shares of Sky Network climbed 4.1% to NZ$4.08 and have declined 17% in the past 12 months.

The Freeview joint venture with TV3's Mediaworks, Maori TV and Radio New Zealand began operating in the first quarter of the last financial year, and around 6% of potential users were Freeview subscribers.

TV6 and 7 will become available on Sky from July 1, while TV1 and 2 will now be available in High Definition broadcast from Sky.

The two networks had a carriage contract for TV1 and TV2 which was scheduled to expire at the end of 2011. The new agreement extends arrangements to 2020 and beyond.

By Jonathan Underhill

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