Nine and Fairfax will both invest $50 million each in the StreamCo joint venture. Privately, execs have suggested the video streaming platform will commission its own programming, not just churn out Nine content.
The play is touted as a Netflix style move. The US streaming platform's success came in part from its self-commissioned House of Cards property, which it famously decided to make off the back of subscriber data.
Announcements on the data underpinning the platform are yet to be made. But what is known is that although StreamCo will broadcast Nine content, it will also make its own deals with other content producers. That will at times mean the platform is a competitor to Nine and Fairfax.
Sources close to the company say that StreamCo is not poised to become the subscription video on demand (SVOD) arm of Nine Entertainment Company, and the network is still committed to its JumpIn platform across desktop, mobile and tablet.
A number of content deals will be revealed ahead of the launch, some of which will come from Nine's new program schedule.
The SVOD service is expected to launch in the first half of 2015.
Local and international program content from TV series, film, kids content and documentaries will be available to subscribers who pay a fixed fee. There will be no minimum term commitment and content will be available across internet connected TVs, tablets, desktops and mobile for what Nine is calling a “low price”.
Both Fairfax and Nine's marketing clout will be leveraged to boost the StreamCo launch and the $50 million apiece from both parties includes a significant marketing and advertising budget, although that will leverage the platforms of both parties.
StreamCo is headed by CEO Mike Sneesby and will operated independently of both Nine and Fairfax.
NEC CEO David Gyngell and Fairfax CEO Greg Hywood will be on the board.
Gyngell said: “I am excited about working with one of Australia’s iconic media companies on this ground breaking opportunity. The combination of our two businesses will provide the joint venture with unprecedented distribution and awareness. I look forward to building one of Australia’s greatest new media businesses.”
Hywood added: “We’re delighted to join Nine in developing a compelling subscription video service. SVOD is a proven business model overseas, and we look forward to offering this service to our subscribers, and indeed all Australians. Fairfax will continue to seek innovative ways to engage and expand our audiences, and this is an opportunity to create value through participating in the next wave of media evolution. Nine is a fantastic partner and we look forward to working with them on StreamCo.”
Sneesby, StreamCo's CEO said: “Having two of Australia’s pre-eminent media companies as StreamCo’s shareholders strengthens the base of our experience, whilst providing an amazing marketing and promotional platform for our new service. I look forward to revealing more details about our offering in the near future.”
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