Telstra Corporation Ltd (ASX: TLS) is planning to launch its own streaming media device called Telstra TV, but it could be a dud for the telecommunications giant.
The streaming media sector is already chock-a-block with devices and streaming media giants, but Telstra reportedly wants to offer customers access to Netflix, Presto and Stan for less than $30 per month. The Telstra TV is eventually aiming to support every streaming service available in Australia, including YouTube and many others.
Telstra group managing director for media and marketing Joe Pollard says, "Our target is the entire rest of the market that doesn't currently get pay TV."
Presto is the streaming service offered by a joint venture between Seven West Media Ltd (ASX: SWM) and Foxtel – 50% owned by Telstra, with the other half owned by News Corp (ASX: NWS).
Stan is a joint venture between free-to-air broadcaster Nine Entertainment Co Holdings Ltd (ASX: NEC) and newspaper publisher Fairfax Media Limited (ASX: FXJ).
Telstra TV is a bit of a risky proposition for the telco. If it's successful, it could cannibalise pay-TV Foxtel customers switching to Telstra TV. But Ms Pollard doesn't see it as a direct competitor, rather aiming at non-Foxtel customers.
Telstra's TV is reportedly called the Roku 2, unsurprisingly based on the Roku 2 from US company Roku. It is reportedly one of the easiest, if not the best streaming device on the market, according to News.com.au, with a speedy, easy to use interface and constant updates. In the US, it has become popular with households switching from expensive Pay TV packages, with the Roku 2 sporting hundreds of apps. It comes with its own remote control or use the free Roku app on your smartphone or tablet.
The device will compete against Apple's TV and other hardware devices such as Google's Chromecast and Internet TVs. But with more and more TVs having their own internet connections, having a separate device seems a bit redundant and old fashioned. Apple and Google aren't about to sit back and let Telstra eat their lunch either.
What's more, the Roku 2 doesn't have a TV tuner or the ability to record live TV, which other devices such as FetchTV, Foxtel's boxes and Telstra's T-Box can all do. Telstra's T-Box will be replaced by the Telstra TV, but will continue to be supported, as Ms Pollard told The Australian, "We will not sell any more T-boxes once this device launches but we'll continue to support it with content because the people who have the T-box love it."
Telstra had sold 761,000 T-Boxes as at August 2014, according to ex-CEO David Thodey, but more than half of online customer reviews rated it as a terrible product.
The Telstra TV will launch on September 10, and we'll get to find out the full details of which apps it supports and pricing.
