By Claire Reilly

More the 300,000 Australian homes are accessing their TV over broadband, opting for IPTV services such as Optus FetchTV and Telstra TBox over traditional subscription services such as Foxtel and Austar.

A new study released yesterday by telecommunications analysts Telsyte shows that 1 in 10 subscription television services is delivered over broadband, with this figure expected to rise to 1 in 3 by 2015.

Services such as Optus FetchTV offer users flexible viewing of free-to-air TV as well as additional pay-per-view content, new television shows and new release movies. According to the director of Optus digital media, Austin R. Bryan, Optus’ Fetch service “redefines conventional TV viewing, bringing choice and control to all consumers.

“There has been an explosive growth in the popularity of connected devices over the past few years, and there’s a huge demand for content,” he said.

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The author of the Telsyte study, Chris Coughlan, said the rollout of the national broadband network was changing the role of traditional subscription service providers, and also changing the way consumers engaged with television.

“Foxtel faces a dilemma as distribution over the NBN requires it to become a retail service provider supplying broadband access, something that its majority shareholder, Telstra, might be reticent to allow,” said Coughlan.

“It also faces challenges with regard to margin erosion if it follows suit with cut-down offerings” he said.

“Based on both on interviews with industry executive and a comprehensive survey of Australian consumers, Telsyte’s research found that IPTV offers are well places to meet the main objections people have with subscription TV, that is ‘too expensive’ and that ‘free to air is good enough’.

“Telsyte has determined the total subscription TV industry in Australia generates around $2.7 billion for service providers. While most of this revenue goes to the two largest operators Foxtel and Austar, there are emerging credible services over broadband...that are supplementing the mature satellite and cable markets.”