Tele2 Netherlands adds 10K IPTV Subscribers

Tele2 Netherlands added 10 thousand IPTV subscribers in 2Q08, giving it a total of 247 thousand. This is less than the 12 thousand that it added in 1Q08.

It appears that Tele2's IPTV service is flattening. The Netherlands has a very strong cable provider and IPTV has been struggling there.

Tele2 Netherlands at 237K IPTV Subscribers

Tele2 Netherlands reported that it added 12 thousand IPTV subscribers in 1Q08 giving it a total of 237 thousand. The company added 24 thousand IPTV subscribers in 4Q07.

Tele2 continues to move forward with its IPTV service. It will be interesting to see how the rest of 2008 shapes up for the company since it has lost its exclusive rights to the Dutch football broadcasts.

Tele2 at 225K IPTV Subscribers in The Netherlands

Tele2 in the Netherlands (formerly Versatel) added 24 thousand IPTV capable subscribers in 4Q07 giving it a total of 225 thousand at the end of the year.

Tele2 is continuing to grow its IPTV service in a very competitive market in The Netherlands. Things may become more difficult for Tele2 in 2008. The renogotiation of the football TV rights may cause it to lose a key advantage.

IPTV Market in The Netherlands

While I was in Amsterdam, I met with KPN as well as Versatel to discuss the IPTV market in The Netherlands. My previous post discusses Versatel's offerings and strategies. I also recently did a post discussing KPN's strategies.

The Netherlands is dominated by cable with more than 6 million of its 7 million homes subscribing to the service. The cable service costs 16 euros per month. There are about 1.2 million digital subscribers in The Netherlands.

KPN stated that it believes that it is a battle with cable for each home. It believes that by 2010, 70 percent of homes will choose either a telco or the cable company to provide all voice, data, and video services to the home.

Digital Terrestrial is becoming a significant factor in the Netherlands and accounted for over half of the conversions to digital television in 3Q07. KPN offers a digital terrestrial service for 6.95 euros per month for the first set-top box and 3 euros per month for additional set-top boxes. Its digitial terrestrial offering is generally intended for the TV sets in the home that are not connected to the cable service.

Both KPN and Versatel offer services competitive with cable at 14.95 euros per month. They also share the same football programming, which is produced and broadcast by Versatel and broadcast by KPN as well under license from Versatel.

The IPTV providers in The Netherlands have to overcome strong, established competition from cable providers. It is interesting that KPN and Versatel seem to be cooperating with each other to some degree to establish IPTV. I think this is a smart approach. The more that they can establish an IPTV brand in that country, the more business there will be for both of them.

Tele2 Netherlands

When I was in Amsterdam last week, I met with Tele2, which was formerly known as Versatel in The Netherlands. It now has 200 thousand Tele2 Vision IPTV capable subscribers out of its 281 thousand broadband subscribers. It offers three packages:

• The Visionbox plan has no recurring monthly fees and provides access to Tele2's on demand services. This plan is targeted at cable subscribers that want access to Tele2's on demand sports and entertainment services.
• The Vision Silver plan is offered at 7.95 euros per month and includes 20 broadcast channels as well as its on demand sports and entertainment services. It also expects that this service will supplement cable services in the subscriber's home.
• The Vision Gold plan is offered at 14.95 euros per month and includes 41 broadcast channels as well as its on demand sports and entertainment services. It also includes the first six months of its football services for free. It expects that this service will be a replacement for cable services.

Tele2 now offers interactive services that are being used to market and sell mobile telephone and banking services. Its has found that 18 percent of its viewers clicked into the mobile interactive service and that 10 percent convert to mobile subscription. It will be introducing branded channels with the Grolsch brewery.

Tele2 has experienced strong growth with its broadband service recently. It had 6 percent broadband subscriber growth in 3Q07.

Tele2 has had good growth with its IPTV service that has been driven by a strong football offering. It is facing strong cable competition and will have to continue to develop creative approaches to the market to fuel further growth.