Friday, 11 April 2014


Kim Eng on 10 Apr 2014

  • M1 may be on the verge of securing a key condition for its Pay TV service MiBox to take off. Reiterate BUY.
  • MiBox is reported to have almost 10,000 subscribers, which M1 needs to cross-carry exclusive content from other telcos.
  • This could jump-start its Pay TV service and bring in new users to its network.
What’s New
The Business Times reported today that M1 may be close to the 10,000 MiBox subscribers it needs to be able to cross-carry exclusive TV content such as the BPL and World Cup. In our 2014 telco strategy report early this year, we flagged this as a wild card that, if it succeeds, could jump-start M1's fledgling Pay TV service and bring in new users for its mobile and broadband services.

What’s Our View
It looks like M1 is aiming to cross-carry mainly exclusive content from the other two telcos with very little content that it purchases itself, which it cannot afford to buy given its small size. You could call this a freeloader strategy but that does not mean it will not be a good deal for price-sensitive consumers because the service is priced rather low (SGD8.56 for M1 subscribers and SGD12.84 for everyone else), which makes it the most inexpensive way to watch BPL, World Cup or any other exclusive content from StarHub and mioTV in future. It costs SGD26.75 and SGD29.90 for an entry-level family combo from StarHub and SingTel, respectively.
It was also reported that 67% of the MiBox subscribers are not existing subscribers of StarHub or mioTV, information the Business Times obtained not from M1 but from its set-top box provider Vodoke. This is very interesting. It would appear at first that M1’s Pay TV strategy is targeted at a niche market, namely, sports fans. But we think this segment of users could be growing as more become indifferent to linear TV (ie, schedule-based) and plug into on-demand TV (ie, anytime and interactive) made possible by fast Internet connections and content providers such as Hulu or NetFlix.

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