March 4, 2008

Seven Network plays to win in the Australian mobile TV and Internet space

Posted in Articles at 5:22 pm by siddey

For those not following the trials and tribulations of Unwired Australia, the listed ASX wireless internet provider that holds the rights to the Wimax spectrum here, you would have missed the fact that the end of 2007 saw them taken over by listed Australian media cash-box, Seven Network Limited (ASX:SEV). In case you’re wondering why a predominantly media based group would want to buy a wireless Internet Service Provider, here’s a little bit of background on Seven to help fill in the gaps.

1. Seven Network used to be in the cable television arena until their sports network C7 was an unceremonious financial flop back in 2005 due to a number of mitigating circumstances, most of which were the subject of a long-running anti-competitive based legal case against their primary competitor at the time.

2. Foxtel is the current dominant cable TV provider in Australia (yep – that’s right, Seven’s nemesis!), comprising part ownership from – Telstra, Newscorp and Consolidated Media Holdings.

2. Seven Network recently sold around a half-share of their media assets to US based investment group KKR and are now armed with $2.5b cash.

3. They’ve invested heavily to-date in expanding their Internet asset portfolio (content providers, strategic partnerships, e.g. Yahoo!7 ) including technology company Engin which currently provides cable internet-based voip services but is rapidly appearing as becoming the primary vehicle by which Seven will deliver Tivo and IPTV capabilities in the near-term.

4. What do you do when the dominant cable TV player also has a majority holding from the dominant player in Australia’s cable, wireless internet and mobile phone market?

Answer: You buy your own, almost profitable wireless internet provider, expand their network and use the Wimax spectrum to trounce your competitors with subsidised wireless IPTV and roaming mobile Internet services.

Revenge is sweet, so they say. 🙂

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1 Comment »

  1. “Seven Network plays to win in the Australian mobile TV and
    Internet space Geographically challenged” was in fact
    a really good blog, . I hope you keep creating
    and I’m going to continue to keep following! Thank you -Scott


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