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July 29 (BusinessDesk) – The $3.4 billion Sky-Vodafone New Zealand transaction the Commerce Commission rejected in 2017 was the most difficult of the vertical mergers former chair Mark Berry had to consider.

Source: Sky-Vodafone merger decision challenging – Berry | Scoop News

Would the Commerce Commission make the same decision today?

It could go either way.

One of the reasons the deal was turned down was Sky’s iron grip on sporting rights. Since 2017 Spark has entered the market with Spark Sport, yet aside from this year’s Rugby World Cup, it doesn’t have rights to any of the major NZ sporting codes.

Sky has gone from owning 100 percent of the sport market to something less than that. Yet it’s market presence remains substantial. It would be hard to argue things have changed enough to alter the merger decision. This could change if Spark Sport achieves lift-off.

Spark, you may recall, was one of the main objectors to the Sky-Vodafone merger. Its lobbying paid off.

2degrees featured prominently in Mark Berry’s deliberations:

“There was particularly a concern about what the future of that market would look like if we let this merger go ahead, and if that kind of effect happened – with customers being taken away from 2 Degrees such that it would no longer have the incentive or the ability to invest and compete.”

Former Commerce Commission chair Mark Berry

It’s worth reminding yourself that in some ways 2degrees is a talisman for mobile telecommunications market competitiveness. While 2degrees is a force, the market can be seen to be working. The company’s position is no strong today.

One other change since 2017 is that Vodafone now looks to be in a stronger position since its part-acquisition by Infratil. This would play into any Sky merger decision in a subtle way.

Infratil also owns a substantial share in Trustpower, the fourth largest internet service provider. It has told the Commerce Commission that Trustpower and Vodafone would remain separate.

There has to be some concern about this. Since the acquisition Trustpower has joined with Vodafone and Vocus’s unbundled fibre campaign. That could be a coincidence.

Yet given Trustpower’s strength in building bundles of services around broadband, the possibility that company might have preferred access to Sky content would set off all kinds of alarms at the Commerce Commission.

Sky TV has rebooted its streaming sports service with Sky Sport Now. It’s a new app for phones, computers and tablets offering 12 dedicated sports channels. It will replace Sky’s Fanpass from August 1.

At the same time Sky will start broadcasting a dedicated sports news channel. It will have local news and have local presenters. It will also pull material from around the world. This includes bulletins from Fox Sports News Australia and Sky Sports News UK.

The revamped streaming app will have dedicated channels for rugby, golf, cricket and football. Sky will add two ESPN channels and the new sports news channel to the mix. There will also be pop-up channels for major sporting events.

Better everything, high definition

Sky CEO Martin Stewart Sky Sport Now is the first evidence of the company’s new focus on online streaming.

Well yes. It’s also the first evidence that Sky is fighting back against Spark Sport. For months it has looked as if it had no answers, nothing practical to respond with.

The new app addresses one of the weaknesses of the old four channel Sky Fanpass by giving users access to replays and on demand content. There will also be links to statistics on games and individual athletes.

Pricing for Sky Sport Now includes a weekly $20 pass and a monthly $50 pass. Customers who sign up for a year pay $40 a month.

Sky Now competes with Spark

Elsewhere Stewart told Chris Keall at the New Zealand Herald Sky will be a more aggressive bidder when buying sports rights. He says: “If someone outbids us, they’re going to go broke”.

Of course he is talking about Spark Sport.

This is where things get interesting. In round numbers Spark’s revenue is about four times Sky’s. It has relatively little debt, which means it can access cheap money to invest in new products and services.

So, on one level Spark appears to be a formidable opponent. In theory, it could easily outbid Sky for key sporting rights.

Asymmetry

Yet Sport is only a small part of Spark’s business and it most definitely not the main game. Apart from anything else, Spark is about to embark on building a 5G mobile network. This could cost the thick end of a billion dollars over the next decade. There are other calls on its funds. Spark is multi-faceted business.

Investors might not be happy if Spark gets into a high stakes bidding war with Sky over sport.

Sport is central to Sky’s business. That’s likely to be even more the case in future as seemingly unstoppable streaming services like Netflix chip away at the other parts of its business.

Sky doesn’t have much of a future without access to a solid cross section of popular sport programming.

Virtual signalling

By signalling its willingness to outbid Spark for key sports codes, Sky is warning its rival’s investors that the costs could escalate. It is in effect asking if they have a stomach for the fight ahead.

This is not mere posturing. Spark has already blinked with other products that were part of its move into digital services.

The company is looking for partners to share the risk with its Lightbox service. You can take it as read Spark would sell Lightbox at the drop of a hat if there was a realistic offer. Spark also recently closed its Morepork security business.

Digital services like Spark Sport may not be as central to the company’s long-term plans as it has previously said.

There’s another clue for Spark watchers following the Sport project’s progress. Spark is now giving away its Rugby World Cup service to customers signing long-term contracts. This can be read as devaluing the brand, or it could be read as using sport to support the main business.

Room for two?

There can room for two New Zealand streaming sports companies if they can both get the mix right.

Spark doesn’t have enough in its current line-up to be a must-buy service. The Rugby World Cup is a one-off. English Premier League is a niche, albeit a fanatical one with an audience willing to pay.

It needs a long-running, popular, season-long competition, not just a few weeks of a cup tournament.

In effect, Spark needs main rights to at least one of Rugby Union, Rugby League and Cricket. Seeing as you asked, Netball is almost as important, but it can’t carry a channel on its own.

Sky, on the other hand, can’t afford to lose any of these major codes.

The long tail

This is not to say the other sporting codes don’t matter. There is a long tail. It helps to think of the big codes as being like anchor tenants in a shopping mall. They bring in the majority of punters who then stay on for the other options.

The acid test for Spark, indeed the acid test for New Zealand streaming sport is the Rugby World Cup. As Jeff Latch mentioned at Spark’s recent press conference, there will be unhappy people no matter how well Spark performs.

If the RWC is a triumph, Spark Sport can ask investors to loosen the purse strings building a bigger brand. If it’s a disaster, the project will be seen as a brief flirtation. Spark’s next move will be damage limitation and probably a face-saving exit from sport streaming.

Most likely the verdict will be somewhere between these two extremes. For some New Zealanders this will be more of a nail-biter than any action on the pitch.

A persuasive look at the many reasons why you should have your own website, and some of the benefits it will bring you.

Source: Why I Have a Website and You Should Too · Jamie Tanna | Software (Quality) Engineer

Jamie Tanna’s post lists many good reasons to have a website. It’s written from his point of view as a software engineer, many of the reasons translate directly to other trades and professions.

A powerful reason is to own your own little patch of the online world, what used to be called cyberspace. As Tanna says it can be many things, a hub where people contact you, an outlet for your writing and other creative work, or a sophisticated curriculum vitae.

Now you may be thinking you can do all these things on Facebook, Twitter, Medium or Linkedin. That’s true up to a point.

Yet you don’t own those spaces. You are part of someone else’s business model. You don’t have control over how they look, you can’t even be sure they will be there in the long term. After all, there were people who thought the same about  Geocities, Google+ or MySpace in the past.

Creating your own site takes time, effort and maybe a little money. It doesn’t have to take a lot of any of these things. You’ll need to pay for a domain name… that’s roughly $20 a year. If you are hard-pressed financially there are free options with companies like WordPress. You can get a basic WordPress site up in an hour or so.

You don’t need to be a writer to own your own website. If you post things to Facebook or Twitter, use your site instead (or as well as). It could be a place for photography.

One thing you will find is that a website gives you more of a voice than you’ll get on other people’s sites.

 

 

Research company Gartner predicts that by the end of 2021, 70 percent of large enterprises will rely solely on the internet for their wide area network connectivity for small and remote branch offices. This is twice the number of enterprises who connected this way in 2017.

A report, How to Use the Internet for Cloud Connectivity Without Performance Disasters, by Australian-based analysts Bjarne Munch and Padraig Byrne says: “We are now seeing enterprises introducing an internet-first strategy for their WANs. This will also incorporate consumer-grade internet services, where possible.”

In other words, where they can companies are dropping expensive WAN products and jumping on to services like New Zealand’s UFB.

In some cases they use the same consumer services as residential users, in other cases, they use slightly more expensive business-class fibre services. The main difference between the two is the lack of contention on business services, although this isn’t a problem for users in New Zealand.

Business-class fibre services also usually come with better support.

As the name of the Gartner report suggests, the focus here is using the internet to connect to cloud services.

There are many nuances for businesses wanting to get the best performance from an internet service provider. For New Zealand companies one potential problem is the lack of alternative routes to cloud services. Another issue to consider is whether the service offers direct peering to the cloud services you require.

One interesting point made by the Gartner analysts is that many companies now want to include wireless broadband in their connectivity mix. Or as Munch and Byrne put it:

“Mobile broadband is increasingly included for truly diverse access designs.”

It’s a great option when companies have employees on the move, but it shouldn’t be a first choice for cloud connectivity. As the report says: “These are generally asymmetric and have unpredictable overbooking.”