The troubled local Netflix competitor Quickflix has announced that its reseller deal with Presto has collapsed.
The agreement was fundamental to the streaming media and DVD library group’s move to restructure and cut its content licensing costs to get closer to elusive profitability
“The conditions precedent to the Foxtel Presto reseller agreement have not been met and that the agreement is therefore terminated,” Quickflix said in a statement.
The company says it’s pursuing other opportunities, including integrating alternative third party channels into its platform.
The deal with Presto was announced in May. For Quickflix, this meant it could continue to offer DVDs on subscription and premium video on demand for an extra fee but gradually drop its general all-you-can-eat streaming content which would have been replaced by Presto’s offering.
The collapse of the deal puts Quickflix in a hard place. It has to find an alternative to Presto or radically change its model.
Quickflix shares are still in a trading halt this week as it pursues a deal offshore. Details have not been released but industry sources say it could be a takeover.
Quickflix has been losing 5000 customers a month since Netflix launched in Australia in late March.
Paying customers declined by 13% to 107,969 in the June quarter, a loss of 15,584. Revenue was down 15% to $4.2 million.