UK ISP TalkTalk Looks to Buy Blinkbox Movie and TV Streaming Service

Low cost broadband ISP TalkTalk seems keen to build on their existing YouView (IPTV) based TV platform and part of that on-going effort now looks set to include the possible acquisition of Blinkbox from supermarket giant Tesco, which has been suffering from a mountain of financial trouble. Meanwhile Vodafone’s early interest has waned.

The Internet-based Blinkbox video streaming (Video on Demand) service has, perhaps surprisingly to some, been around for considerably longer than most of its modern rivals after first launching into existence during 2007. In many ways it was ahead of its time, offering movies and TV shows for either a one-time online purchase or rental viewing.

Tesco eventually took ownership of Blinkbox for £3m in 2011. Since then the supermarket giant has added Blinkbox Books through the £4.5m acquisition of digital book service Modcast and they later paid £10.8m to gobble music streaming service WE7, which was turned into Blinkbox Music.

But Blinkbox has been a far from perfect service and suffered with the advent of pay-monthly style “unlimited streaming” solutions from the likes of Netflix, NOW TV, Amazon Prime Instant Video and others that ultimately appeared to attract considerably more interest. Blinkbox also dragged its feet over the addition of HD quality video streams, which was only fairly recently introduced and thus handed their rivals another win.

As a result of all this it’s perhaps little surprise to find that last year’s annual accounts showed a combined post-tax loss of £24.7m on total revenues of just £3.5m. In other words, it’s hardly the most attractive proposition on the market and yet, according to the FT, TalkTalk is now a “frontrunner” to gobble it up.

We’re not at all convinced that this would be the best move for TalkTalk, although it’s likely that the ISP would only pay a very small price because of the Blinkbox’s traumatic financial predicament. Not so long ago Vodafone had also been sniffing around the service (they need a TV solution for their planned spring 2015 consumer broadband launch), but their interest appears to have cooled.

The new CEO of Tesco, Dave Lewis, will next week reveal how he intends to fix the supermarket and that could include mention of Blinkbox’s sale. But the talks are currently still on-going and we’re also unclear what Blinkbox could give TalkTalk that would make it worthy of a purchase. The ISP has already managed to construct a fairly reasonable TV solution, although perhaps Blinkbox’s existing content licences or technology might prove useful.