AN interesting deal this. Industry sources put the price of BSkyB’s stake in Zeebox at a rich $15m (£9.7m), implying a valuation of $150m for a start-up that was launched just two months ago. Extrapolating a price tag mightn’t be entirely fair, because Sky is also buying the rights to integrate Zeebox’s technology into its own apps, as well as various sales tie-ups. But there’s no getting away from it: this is a pricey deal.
Zeebox, which allows viewers to comment in real time on TV shows using social media such as Twitter and Facebook, is a nice product, which should help ginger up Sky’s interactive features. Sky might have the best content offering in the business, but it has trailed arch-rival Virgin Media in when it comes to interactivity for some time.
The ability to collect a viewer’s real-time response to a particular show could also be valuable to advertisers, who are always on the look out for data that helps them improve their message.
Sky is right to pick Zeebox, a platform that relies on smartphones, tablets and other so-called “companion devices”, for its social media push. This means the viewer can use their iPad or iPhone to comment or rate shows, rather than using an app that appears directly on their TV screen. These so-called on-screen widgets are fiddly, and often difficult to clear with the various rights-holders.
What remains unclear is how widely Sky’s customers will use Zeebox. While people are watching more TV, they are watching more of it at a time of their choosing – not the scheduler’s. A platform like Zeebox assumes we are all watching TV at the same time, and want to discuss it around some virtual water-cooler.
That might be true for some shows, such as ITV blockbuster The X-Factor, as well as big-hitting dramas like Downton Abbey and Sherlock. Indeed the phrase du jour for television executives is “event programming”, which denotes a renaissance in the kind of collective telly experience Britain used to have. That said, linear viewing will constitute a smaller part of what we watch.
Sky is a cash-rich company that can afford to have a flutter on this kind of start-up should it wish. But the founders of Zeebox have extracted a very tidy price.