Vodafone abandons its pay-TV plans

With broadband struggling, probably best not to enter another saturated market.


In a fairly predictable move, Vodafone has said it's all but deserted plans to launch a pay-TV service in the UK. The company has barely touched on its televisual ambitions since announcing in spring 2015 that it expected to have something ready before the end of that year. As The Telegraph reports, the project was beset by development delays and difficulty hashing out a deal to carry BT's sports channels. Vodafone CEO Vittorio Colao said that although the pay-TV service was now at a stage where it could be launched "within weeks," the company has decided to put its plans on indefinite hiatus.

While Vodafone has offered pay-TV services in other European countries it operates in for many years, it now seems unlikely that it'll ever join the UK's not-so-exclusive quad-play club. For one, it's probably best not to enter a crowded market when your latest quarterly financial report (published yesterday) shows an overall decline in revenue, core mobile business included. Vodafone also knows all too well the effects of being late to the party. Since fully returning to the home broadband racket in October 2015, the company has only managed to get 129,000 households on its books, which amounts to a tiny market share compared to established providers like Sky, Virgin Media, BT and TalkTalk.

Take that list above, add in EE, and you're looking at all the UK providers in the quad-play club. Membership has grown significantly over the past few years, with all now offering the full monty of TV, broadband, mobile and landline services. Not only can a customer get everything they need from one provider, but they have less incentive to shop around as they are typically treated to attractive discounts upon pledging their exclusive loyalty. By design, competition is getting tougher (or easier if you're the one locking people into quad-play packages).

You don't really need to be a CEO, then, to conclude that if you're struggling to sign up broadband customers, launching a pay-TV service will be just as much of an uphill battle -- let alone trying to convert quad-players onto a different all-in-one package.

Update: Slightly less definitive statement from Vodafone: "Our focus in the UK is on broadband, where we're seeing good growth, driven by our industry leading decision to scrap line rental. We will look at launching TV in the UK when we deem it necessary and commercially appropriate."