BIOS: Technology Means Business

British Sky Broadcasting (aka BSkyB, or Sky) has unveiled plans for a new service that will allow customers to download movies and sports coverage over the Internet to a computer. The service will be available to top-tier subscribers, those who regularly view Sky World, Sky Sports World and Sky Movies World, allowing them to download Sky Movies and Sky Sports content on demand to their PC as part of their existing subscription. Unfortunately, Sports coverage will consist of highlights, interviews and news, but not whole games or matches.

The movie service will offer a mix of 200 new and old films from the Sky Movies channels. You'll also be able to view interviews, programme clips and Sky Sports News bulletins. Subscribers will need a computer with a broadband connection, which Sky is not planning to offer. Sky has yet to confirm whether or not you will then be able to transfer the footage to a portable device, but it's well known that the company has plans to release an entertainment-based mobile product.

The services will be viewable on a TV set but you will require a compatible PC and a broadband connection. Not only does the move give Sky a stronger position in the booming area of broadband content, but it will be a blow to the cable companies' hopes of challenging its dominant position in the market with the addition of VoD (video-on-demand) services, as well as posing yet another challenge to traditional TV spot advertising. It will take around 2 hours for the system to download an average-length Hollywood movie.

Bearing in mind only 200 films are involved, it's possible that Sky is only sticking its toe in the water to get some experience. There have a been a lot of articles suggesting that the phone line could end up carrying huge amounts of TV content - and that Satellite will be an outdated technology. We doubt it is as simple as that but the company wants to diversify and attack its competitors on their home ground. Now, if Sky and BT got together, that would provide interesting.

If nothing else, the announcement shows that Sky is a forward looking company and has decided to react to the threat from cheap postal DVD rentals and other things. However, it is surprising that some people are convinced that new technology will defeat Sky. The company obviously has people looking at future trends, and only the naive would expect things to remain the same forever. And given the position which Sky has reached, we don't think it can be wholly run by short-sighted idiots.

James Murdoch, Sky's chief executive, sees the broadband service as a means of achieving his goal of increasing Sky's subscriber total from the current 7.7m to 10m by 2010.