Retail Giant Tesco Offloads TV And Movie On-Demand Service Blinkbox To Telco TalkTalk

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So much for aping Amazon’s digital strategy. The U.K. retail giant (and supermarket) Tesco has offloaded Blinkbox Movies, its movie and TV on-demand service, to local telco TalkTalk. Terms of the acquisition aren’t being disclosed, though at least one report has pegged the price at £5 million.

Either way, any price needs to be tempered with the fact that the deal also includes Tesco’s 75,000 customer-strong broadband business and 20,000 fixed line customers. Blinkbox Movies, which Tesco took a majority stake back in April 2011, is significantly loss-making after all.

Aside from picking up and servicing Tesco’s broadband customers, which TalkTalk says it is positioned to do using its existing scale, the telco plans to integrate Blinkbox’s tech and team into its existing TV service built on the YouView platform.

Specifically it cites Blinkbox’s technical expertise in “multi-platform, multi-device content delivery”, along with the service’s content relationships. The video and TV on-demand service currently offers 20,000 movies and TV episodes to buy or rent without subscription, available via tablets, games consoles, smart TVs, Blu-ray players, set top boxes and desktop computers.

“TalkTalk TV is already the fastest growing TV platform in the UK with over 1.2 million customers and Blinkbox will help accelerate the development of our platform by delivering a number of key initiatives significantly faster, such as offering a TV app to customers for in and out of home access to paid-for content across a range of devices,” says TalkTalk.

In other words, it’s Blinkbox Movies’ cross-platform — namely, mobile — expertise that TalkTalk is spinning as reason behind picking up the loss-making service. To that end, Adrian Letts, Blinkbox CEO and co-founder will join TalkTalk as Managing Director for TV.

However, at least one question remains: Since Blinkbox Books and Blinkbox Music, Tesco’s e-book and music streaming offerings, both of which are also loss makers, aren’t part of the deal, what fate do they face? For now, the retail giant isn’t saying. But if this really is a u-turn on Tesco’s digital strategy, it wouldn’t be surprising to see the remaining Blinkbox products offloaded or shuttered too.