Got told by BT chat today that if I cancel my TV subscription the youview box won't pause, rewind or record and Netflix, Nowtv apps won't work either? Is this correct?
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All YouView standard features work on all boxes at all times, regardless of who sold you your box and whether you're in or out of contract. Finishing a contract doesn't hobble your box, although of course you'll no longer have access to your subscription channels, and as a result will no longer be able to view old recordings off those channels (as they are encrypted and you need to check in with your provider every time you play one). Freeview broadcast recordings obviously are not tied to your subscription like this so are always available to play.
If you have subscription services billed via BT they may also cease - may differ as to when depending upon the T&Cs.
Was your box supplied before December 2019 ?
No April 2020. Would I be able to subscribe to Now TV and Netflix again though and use the app through the box?
When you cancel you have to return the box as it was supplied on loan , hence the question about December 2019. That's when the T&Cs changed to remove outright ownership & replace with loan agreements and return or be charged.
No they've agreed I can keep the box for a small fee
That’s a good deal being allowed to keep the box for a small fee if it was brand new when you got it 18 months ago. I doubt whether they’ll allow that with the new BT Pro TV boxes. Yes you will be able to use the apps on there to take out subscriptions directly with NOW or Netflix. Most current Freeview/Freeview play recorders have hardly any apps for the streaming services.