Telecom's trial of video on demand, JetVideo, should lead to a rethink in the way the telco bills customers for traffic, says Telecom group marketing manager for consumer, Sandra Geange.
JetVideo allows users to download streaming video over their DSL connections to the PC, and Geange says the cost structure cannot be traffic based.
"We will have to look at the whole JetStream billing model before we launch this product commercially."
An average movie is about 2GB, so a user on a JetStream 1000 account (which gives users the first 1GB free), for example, would be in the red by $1000 after the first movie without using the account for anything else.
The three-month trial involves about 100 households in Auckland, Wellington, Christchurch and Taranaki. Ninety of the homes will have JetVideo to the PC, while the remainder will trial set-top boxes that let them watch the movies on their TV.
"That's really where we're aiming - video to the TV is much more compelling than video to the PC," says Geange.
Intertainer Asia will provide content. Intertainer Asia senior vice president Tony Manton says the company isn't concerned by Intertainer US' collapse in recent weeks.
"They had a difficult market proposition in that they were competing with an established cable TV market," he says.
Manton says Intertainer Asia is already in several markets, including Hong Kong and Singapore, offering video on demand to both PCs and set-top boxes.
Intertainer has ties with various content providers, including Warner Brothers, Universal Studios and MGM.
Telecom says participants in the trial need to have full-speed JetStream rather than the speed limited JetStream Starter and that the connections must be capable of at least 1.5MBit/s.
For the duration of the trial, users will be able to watch the movies for free although they will be asked what price they would be willing to pay for each movie.