A leading communications expert has given Sky TV a damning verdict after they announced cheaper subscription packages today, saying they are "just moving the deck chairs on the Titanic."
Sky TV's shares have plummeted by over seven per cent today on the news they are modifying their pricing packages to include a cheaper entry point as the number of satellite TV subscribers continues to drop.
Communications and technology expert Paul Brislen told 1 NEWS that they need to change their model to an on demand one in order to stay relevant in today's market.
"Price changes are just moving the deck chairs on the Titanic, they're competing with Netflix and Amazon Prime whose services I can both get for the price of Sky's basic subscription.
"It's kind of inevitable really, they haven't made the move away from a channel model so they are still in that old world way of programming.
"Unless they move to an on demand model that customers want they will continue to slide until they fall off a cliff," Mr Brislen said.
Although Sky's half-yearly report showed a net profit for the year, up 12 per cent to just under $67 million, Mr Brislen isn't convinced of the long term prospects.
"Profits are up slightly but that is because of cost cutting and you really do need a vision that is built around growth and more than just reducing your costs because eventually you will run out of costs to cut and that will be the end of that.
"Shareholders and investors should be starting to ask some very tough questions about what is the plan from here."
Almost 34,000 subscribers cancelled their Sky subscriptions in the year to June, prompting the company to look at other options.
Sky's 'Sky Basic' package, which costs $49.91 per month will now be split into two smaller packages called Sky Starter and Sky Entertainment.
People could then choose Sky Starter for $24.91 per month, which features a more limited range of channels compared to 'Basic'.
This means customers could subscribe to a deal including Sky Sports for $54.81 per month, a cut from the current $79.81 minimum.
Those customers who kept both of the newly-minted packages would now also receive the $9.99 Soho channel for free.
The company has also reported a five per cent drop in overall revenue to $433 million for the six months to December.
Its share price fell over seven per cent after today's announcement.