Will Internet steal SingTel's EPL lunch?

SINGAPORE - Starhub has raised an eyebrow at SingTel's new English Premier League (EPL) package, even as analysts predict that the red- hued operator will come off black-and-blue for its pricing strategy.

"The price increase for our competitor's EPL package runs against economic reasoning since the cross- carriage allows a larger base of customers to watch the EPL. With the economies of scale, the EPL package price should come down, instead of going up," StarHub told The Business Times on Monday.

It also noted that it had no control over the EPL pricing, and would be unveiling details of its own offerings soon.

Last Friday, mio TV unveiled a standalone EPL package which offers solely EPL content, in time for the season's kickoff on Aug 17. Priced at $59.90, the standalone deal is nearly twice the price of previous packages that had included the league's matches.

This will be available on mio TV and cross-carried on StarHub's platform. StarHub subscribers will receive the EPL matches over the StarHub platform, but the standalone subscription fee will go to SingTel.

In response to StarHub's comments, SingTel said: "When our competitors were required to cross-carry the Euro 2012, subscription prices increased significantly. They would know that making the matches available on another platform involves significant costs such as cross-carriage fees paid to the competitor, network and manpower costs."

The cross-carriage fees are what SingTel has to pay StarHub as compensation for using the latter's platform.

"It is also harder to build the same relationships with customers on another platform and, as a result, we will not be able to subsidise the standalone subscription," SingTel added.

Last Friday, mio TV also revealed another kind of EPL deal for its own subscribers: a bundled one which throws in another 70-odd channels for only $5-10 more, alongside the EPL content.

While the idea might have been to tip the balance in mio TV's favour in households where there are two set-top boxes, this is a tug-of-war that the red camp might lose - given how football fans still remember the service disruptions that plagued its broadcast of last year's EPL finals.

"Most people will gravitate towards the fact that StarHub has the more stable platform. If you look at somebody who has two set-top boxes, they will be quite tempted to get rid of one. And chances are, the clincher for that would be the stability of the platform," Maybank Kim Eng Research's Gregory Yap told BT.

In this scenario, subscribers will retain only the StarHub set-top box and pay SingTel for just the standalone package, delivered over the StarHub platform.

Even so, another analyst with a local house believes that the standalone package will be a non-starter, given how unattractive it looks relative to its bundled cousins.

"Only an irrational person will subscribe to it," the analyst said.

This gulf in value between the standalone and bundled deals was made more apparent last week when SingTel's top executive, Allen Lew, said that mio TV will pass on the cross-carriage fees and rights acquisition costs to subscribers who buy the standalone package.

Given how the bundled and standalone packages both appear unappealing in their respective ways, the third option of streaming EPL content for free or a small fee on the Internet might be a forerunner for TV viewers now, the analyst with the local house reckoned.

"With a slight delay, you can get EPL content from the Internet. So, (SingTel) is basically driving viewers from real-time TV to the Internet. And that is something that will invariably happen, with these tactics," he said.

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