Denied! Sky TV and Vodafone did not unveil a broadband content deal this morning, as your correspondent had hoped - although both sides did make some revealing comments (keep reading).

The pair did announced a deal that will see the telco pay a Sky TV customer’s $15 a month MySkyHDi rental if they have their landline and broadband connection with Vodafone on a $90 (5GB cap) or $100 (20GB) plan.

The deal, which kicks in from December 7, does not include the $10 a month HD Ticket, necessary to receive HD (high definition) versions of Sky TV channels.

The two companies already have a marketing and single billing alliance, which was announced in June, displacing a similar arrangement between Sky TV and Telecom, which is being phased out.

And for several years, Sky TV has provided content for Vodafone’s mobile TV service.

What’s holding back IPTV?
There was a bumper turn-out at the Vodafone-hosted Auckland launch of the new deal this morning, with speculation rife that the two companies would announce an IPTV alliance for delivering movies and TV shows on-demand over an unmetered internet connection - a la Telecom’s alliance with the one-third TVNZ-owned TiVo.

Afterward, NBR asked Sky TV boss John Fellet what was holding IPTV back.

One qualifier is that there have to be around 200,000 MySky boxes in the market to make such a service economic to Sky TV, Mr Fellet said. But with around 70,000 installed each year, that mark is fast approaching.

But other than that, it’s purely up to the internet service providers, said Mr Fellet. If Vodafone (or Orcon or CallPlus) comes to him ready to offer unmetered data (that is, movies and other downloaded content would not count toward a monthly cap), he’s willing to hit the Go button on IPTV.

Irreconcilable difference
It’s unlikely that Vodafone will be one of those ISPs.

“I don’t believe in IPTV,” Vodafone NZ chief executive Russell Stanners told NBR immediately after the launch.

The Vodafone boss said there was some demand for downloadable movies, but he did not see it as a killer app, or a business that his company should be in.

Mr Stanners was also down on unmetered data.

“All data costs something,” said the chief executive.

Any reduction in customer churn (Telecom claims its TiVo alliance could cut defections by 50%) would not make up for the cost of such as service.

Mr Fellet was philosophical, saying the immediate focus had been on getting a bundle together that Vodafone could promote ahead of Christmas.

See Vodafone's pitch for its Sky TV promo here.