SkyTV promises a bigger box of tricks by 2008

Sky Television, the listed pay-TV company, will launch its next-generation set-top box in early 2008 and a video-on-demand service for its MySky subscribers in May next year.

The new box would have a hard drive and be capable of carrying high-definition TV data over the internet, chief executive John Fellet said at the company's annual meeting in Auckland yesterday.

IPTV would offer viewers more personalised TV, allowing them to access a range of programming - including archived shows - at a time that suits them. "If you wanted to play a certain episode of Friends from a certain series, this would be a way of doing that," said Fellet.

Details of the new box, including the cost to customers, were yet to be finalised but Fellet allayed fears it would be expensive for Sky TV.

"The consumer pays for everything or the company goes bankrupt," he said.

The company would partner with internet providers to run the service and was trialling a prototype.

Fellet said a second new initiative, video-on-demand, would be launched in May. The service would allow users of its personal video recorder MySky, released last December, to download around 20 movies on demand.

The system would eliminate the need for pay-per-view viewers to start watching a movie at a preset time, which was a "severe weakness" of the service, said Fellet.

Sky TV generated around $1 million a month in revenue from its pay-per-view service.

Fellet said the company still expected a full-year net profit of $80 million to $90 million, up from $60 million last year.

The company had reduced its capital expenditure guidance to around $100 million from the $120-$130 million range because some development at its site had been deferred until the following financial year, he said.

Chairman Peter Macourt, yesterday re-elected as a director, said the company was pleased with the successful launch of the Optus D1 satellite earlier this month.

He said the satellite was expected to become operational by the middle of next month, to replace the current technology, which was "on its last legs".

Shares in Sky TV closed up 9c yesterday at $5.55.