Advance: DirecTV will give new TV service in Argentina, in the middle of the Telecom vs. Telephone battle

DirecTV is soon to launch its streaming service in Argentina. After having done the same in Colombia and Chile, it is preparing to strengthen itself in a context in which Telecom, its main competitor, continues to focus on Flow; Telefónica already activated Movistar TV to give its first battles in the television business and Claro moves forward with its television service, not without some setbacks.

The move comes after the November 15 began to offer its video service on demand in Colombia and Chile, in a format identical to the one that has been providing since the end of 2016 in the United States with DirecTV Now, as it was baptized your pay TV service in that country.

Coincidence or not, in the context of the convergence process in Argentina, with this new platform the firm will enable its on demand system, including sports broadcasts and the chance to adhere to premium content for an additional payment, in a scheme identical to the one that operates with those signals on traditional pay television.

Also with fiber optic
The advanced DirecTV is not only in terms of streaming, it will be possible to consume from different screens and not only from the living room of the home.

In silence, it is deploying fiber optics in various points of the province of Buenos Aires, such as Esteban Echeverría, Ezeiza, Ituzaingó, La Matanza, San Miguel and Tigre; areas where there is not enough availability of this technology. It will also do the same in localities of Córdoba

This expansion plan of the network is added to the one he has had for more than two years in Godoy Cruz, Mendoza, where he kicked the board with this benefit. Because the Internet connections in that province are so bad, the first one who landed with that possibility in the residential market quickly made a difference.

Movistar, for its part, anticipated that it is building its own fiber network in the departments of Godoy Cruz, Las Heras and the San José neighborhood in Guaymallén. These are three of the main districts that make up the Greater Mendoza and in which almost 60% of the inhabitants of that province are concentrated, where Telecom does not have a presence with Cablevisión.

Today, new fiber optic lines are being deployed in places with high demographic concentration and purchasing power, given the cost of investing in this type of infrastructure. It is a scheme that repeats the development of previous networks.

The new consumptions

The so-called phenomenon of cord cutters - those that are downloaded from the subscription TV service in favor of the OTT - is watched with great attention in countries like the United States and is the reason why the main operators have their own platforms of video streaming on demand.

Competition in the paid television segment will increase dramatically among subscription TV companies, telecommunications operators and OTT service providers that will compete for customers, 84% of the executives of companies in this industry agreed, highlighting to a Dataxis report. That percentage was 82% in 2017. In fact, the horizon is already more than clear for several years.

This transformation not only points to the migration of users from one service to another, but also to a larger change in the billing level and, therefore, in the business model. This aspect is not yet evident in Argentina, but it is present as a basic concern.

The strategy that is being promoted in the United States is now falling to Latin America, where the advent of platforms that respond to this new trend is also growing. It will not be a change of behavior that occurs from one day to the next, but it will take time. But the new proposals point in that direction.

At least that's what John Stankey, CEO of WarnerMedia, the new entertainment division of the company, said: "We are committed to launch an attractive and competitive product. My job is not to build another Netflix, but an interesting offer in terms of content. "

This phenomenon is what, in some way, "inspires" what is happening with DirecTV in the region. In addition, it is still focused on a highly successful strategy for its business, such as the sale of its service in prepaid mode, a model that began some 10 years ago in Venezuela and then came back to the country with good performance, at least in the eyes of the company itself.

A successful prepayment
"In the context in which we currently find ourselves, Prepay is a very attractive product. Halfway between traditional TV and OTT, it has very advantageous features for users: the possibility of accessing content without committing to a monthly subscription, in a flexible and economical way and, at the same time, offering high technology and Premium programming , without the need for a high quality broadband connection, "said the company.

In this regard, he added that "its launch meant a before and after for a large part of the population, since more than 57% of the clients before did not have access to pay TV, either due to geographical or socioeconomic circumstances. We continue betting on the Prepaid product in Latin America and this year especially, in which we launched Prepaid HD with more than 40 additional signals available in high definition. "

In Argentina, the phenomenon of new content consumption occurs in a complementary and perhaps exclusive front, in a market with the highest pay TV penetration rates in the region.

In this sense, the development of new fiber optic networks is crucial, since they are the only ones capable of responding to the demands and quality of service of users who want to consume video through their broadband connections. It is what explains that DirecTV is also immersed in an infrastructure construction project of this type. Although the company at the local level does not tire of asserting that its focus is on content, the characteristics of the Argentine model also lead the main providers to put chips in the distribution networks.

In fact, the main competitors of the country's second largest pay TV operator are embarking on initiatives in that direction: Telecom strengthens its subscription TV network based on GPON technology (fiber optic equivalent in the cable business), Telefónica he does the same in Buenos Aires and Mendoza, and Claro expands in AMBA and Salta. For now, the subsidiary of Carlos Slim's company is not expanding its TV service to new areas.
The strategy is followed even by independent operators and telecommunications cooperatives that bet on fiber optic as a defense against new consumption and with large providers, who have more back to offer services at attractive prices.

For this reason, iPlan deploys its fiber network in the northern area of ââthe Capital and province of Buenos Aires, and SMEs and telecommunications cooperatives do the same in their areas of influence. The cases of Correa Radiovisión in Correa, Santa Fe; of the Cooperativa de Telecomunicaciones de San Martin de los Andes in Neuquén (COTESMA), among the best known, join those already developing similar entities nucleated in both CATEL and COLSECOR.

The truth is that DirecTV, the giant that was missing to join the proposal of TV via streaming, prepares its final touches for the launch of its OTT in Argentina and does so in a scenario of increasingly strong drives between competitors and the demands of the users.

Temas relacionados