Quickflix hits 'pause' button on ASX
Updated: movies online to PS3
Quickflix, Australia’s answer to Netflix, has entered into a trading halt pending a "significant announcement" regarding a partnership agreement for its digital movie streaming service.
Quickflix has been building momentum in recent months, raising $AU4.7 million and acquiring Telstra’s snail mail DVD and Blu-ray library asset, BigPond Movies, in July.
The ASX listed company has also been busily acquiring a cabal of former Telstra Media executive brains trust including Justin Milne as Quickflix deputy chairman, former Telstra Media GM business development and content acquisition Andrew Lambert as executive VP at Quickflix and former director of Telstra Media, Chris Taylor who was appointed CEO of Quickflix in July.
Recently Quickflix also announced the first of its digital distribution partnerships with an agreement to launch its upcoming movie streaming service on the Sony Bravia platform of internet connected TVs and devices.
In its first significant marketing burst, last week the company announced that it would be rolling out its first national advertising campaign with Belgiovane Williams Mackay (BWM) – Milne’s favoured agency while at Telstra - and media agency Foundation.
Quickflix has been poised to move its online rental model to a digital streaming platform for some time but appears to finally have the right team and partnerships in place to meet market expectations.
The Quickflix executive team has been in the US in recent months talking to potential technology partners and investors but have not given away in clues as to who the significant technology partner will be.
Speculation has been circling for months - but yet to be confirmed or denied by the Quickflix executive team - that Netflix will emerge as a significant investor and technology partner with Quickflix as part of its current global expansion drive.
Earlier this month, Netflix chief content officer Ted Sarandos told an audience at broadcasting show Mipcom in Cannes, that the company was actively looking at expanding into markets that had a hungry appetite for streaming video and were underserviced by other propositions. It has already launched in Canada and Brazil and will be expanding widely through 42 Latin American markets and the Caribbean in coming months.
In the year to June, Quickflix delivered more than 3.2 million DVD and Blu-ray discs to Australian households from distribution centres. According to its Annual report, released yesterday, paying subscribers have increased by 78 percent for the year with total subscribers exceeding 82,000 and revenue was up by 53 percent to $AU10.9 million for the year. The online movie rental company is still targeting a million customers within five years.
Quickflix chairman Stephen Langsford recently told Boardroom Radio that the one stop Quickflix service currently offers the largest range of movies and TV series in Australia that is available via one website, with one interface allowing consumers the choice of rental, DVD, BlueRay or streaming. “The Quickflix service will soon be available through a whole host of internet connected devices from TV screen to blue ray players to other devices and that’s very exciting,” he said.
“While we have a close watching brief on international markets such as the US, UK and Europe and the dynamics behind each market are different. In Australia, we have a market place where we have consumers that love renting movies and a relatively low penetration of Pay TV - 35 percent versus that of the US at 90 percent. And broadly we have a less competitive market in Australia and one that is largely underserviced.” ®
Update - Not Netflix after all: Quickflix will begin streaming its subscription movie service via PlayStation3 later this year. The move is the first part of Quickflix’s transformation from a DVD rental to digital streaming provider. The deal is an extension of the agreement signed with Sony in July to begin streaming content via the Sony Bravia connected TV platform.
Quickflix CEO Chris Taylor said “over 1.3 million Australian consumers who own an internet connectable PlayStation 3 will have access to Quickflix’s on demand movie streaming service.”
The Quickflix movie streaming service on PlayStation 3 will offer unlimited viewing of movies, operating side by side with its existing online DVD and Blu-Ray rental by mail Service. ®