Sky TV closing down igloo, its low-cost pay TV service that lost millions

Sky TV CEO John Fellet
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Sky TV is closing igloo, formed in 2011 as a joint venture with TVNZ to provide low-cost pay TV.

Igloo's 13 premium channels and pay-per-view, on-demand movies will cease to available from March 31 next year as Sky cleans house ahead of its merger with Vodafone and a transmission contract expires [UPDATE: Sky TV CEO John Fellet says the closure was not motivated by the pending merger].

Subscribers will be offered Sky Basic at $19.95 a month (the same rate as igloo) until July.

TVNZ invested $12.25 million for a 49% share in Igloo in 2012 but reduced its shareholding size to 34% in 2013 before completely exiting the business in June 2014 by selling its remaining shares to Sky for $1.

The state broadcaster took a $3.2 million charge on asset impairments and a $6.3 million charge in 2014.

Sky surveyed igloo users on the possibility of a Super Rugby pass and more online entertainment content but ultimately launched new services Fanpass to attack those markets and igloo languished as a footnote.

Subscriber numbers were never broken out but Sky did acknowledge they never came close to its first-year target of 30,000. The lack of recording capability was one drawback.So was a relative paucity of ondemand content (factors that caused NBR to predict igloo's failure even before it launched).

Sky could upsell frustrated igloo users to MySky. But for TVNZ, it meant the service was a dead-end.

Igloo's closure will free up a modest amount of spectrum. Sky TV corporate comms director Kirsty Way says Sky has yet to decide whether to use the spectrum for itself or try to find a buyer. 

FLASHBACK: igloo CEO Chaz Savage with Sky TV CEO John Fellet (centre) and then TVNZ CEO Rick Ellis at the December 2011 igloo announcement. The service went live in 2012. Savage quit after a year. Ellis joined Telstra in 2012, where he lead an effort to push the telco's T-Box television service into the mainstream. T-Box was axed in late 2014. He is now CEO of Te Papa.

Destined for MOTAT (or maybe just the bin): An igloo set-top box.


15 · Got a question about this story? Leave it in Comments & Questions below.

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15 Comments & Questions

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Well, I'll be a monkey's nephew -- I've been a Sky subscriber from day-one, and I never knew Sky offered such a service. Amazing!

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so it is back to freeview had sky once but cancelled because of all the repeats what other options are there for cheap tv for benificeries

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As written, doomed to fail before launch no matter how much SKY talked it up. Lower price but significantly less inclusions with no value /compelling reason to take it up. The fact that it had its own CEO demonstrates how much spare cash SKY had to throw at it.

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Didn't cost Sky much. The CEO was a sales guy. It already owned the spectrum, plus the content rights (igloo was launched with a subset of Sky channels). 

It was maybe useful as a tool to distract TVNZ for a couple of years, and to give the illusion of a more diverse market during the time before Netflix.

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Obviously the new master Russell CEO of Vodafone has told John Fellet to bite the bullet and can it. A sign of more things to come!?

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The Basic package is worthless, outdated and repeated content in SD that heavily compressed. Might as well watch Youtube, the cat videos are more interesting.

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Anyone wants an igloo for 10 bucks? (I'm serious)

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BREAKING: NBR has located an igloo customer.

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Any other option to get the BBC TV without joining Sky,? "Cheers Kees

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You can use Filmon.tv and watch the Beeb (plus all other UK basic channels) for free in SD for as long as you like on an internet connected device. I watch Match of the Day every weekend on it.

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Hmmm, I like Igloo, yes really due mainly not being tied to a contract, just pay and and use as required since I travel a lot. This is why I didnt go to Sky. I use Netflix which is great value.

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How much will the replacement sky package - cost per month [that replaces the igloo basic rate of $19.95 - per month(charged - now!)]?

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I too like my igloo but Netflix is amazing so guess I just stick with that and youtube..not fan of sky or Vodafone long live spark and Netflix :)

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what will happen to uk tv,choice tv,and Jones tv ?

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igloo tv would still be on air if they had some better channels it took a while for jones to come to igloo they could have operated with the system take one or two channels off replace with others

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