Light Reading
Big Canadian MSO is reportedly spending $100 million to roll out Hulu-like OTT service that would compete with Netflix.

Rogers Preps Online Streaming Service

Alan Breznick
1/13/2014
50%
50%

TORONTO -- Seeking to stem the erosion of its cable customer base, Rogers Communications is reportedly planning to launch its own online media streaming service to compete with Netflix across Canada this spring.

Rogers Communications Inc. (Toronto: RCI) is negotiating with most of the major Hollywood studios and rival media groups in Canada for the streaming rights to movies and TV shows, according to various press reports here. As first reported by Cartt.ca (subscription required) late last week, Rogers has already spent more than C$100 million (US$92 million) to build a catalog of on-demand programming for the new streaming service.

Rogers officials have declined to discuss their streaming plans so far. But they've made no secret of their interest in establishing such a service. The company, which was one of the first North American service providers out of the gate with a TV Everywhere service several years ago, has said for months that it's seriously exploring the video streaming market.

Industry sources told Carrt.ca that the new over-the-top (OTT) video service, tentatively called Showmi, will be modeled on Hulu Plus, the premium, ad-supported service run by Hulu LLC . In a blog post on the company's website last month, new Hulu CEO Mike Hopkins boasted that the pay service has now signed up more than 5 million subscribers, up from slightly more than 3 million a year earlier. Largely as a result of Hulu Plus, Hulu surpassed $1 billion in revenue in 2013 (See Hulu Flexes Fresh Muscles.)

With Showmi, Rogers aims to stave off Netflix Inc. (Nasdaq: NFLX), which has made big inroads in Canada since crossing over the US border in September 2010. Although it offers far less content than its US counterpart, Netflix Canada signed up more than 1 million subscribers in its first year and now has an estimated 2 million to 3 million customers in a market with no more than 12 million TV households and close to 90% pay-TV penetration.

Rogers also hopes to stem the growing tide of video "cord-cutters" and "cord-shavers," who have either been eliminating their cable video subscriptions entirely or downgrading to much lower levels of service. Like just about all major North American MSOs, Rogers has been shedding basic cable subscribers for at least the past year, losing 100,000 video customers in the first three quarters of 2013 alone.

Indeed, cord-cutting has become a serious concern for video providers in Canada, just as in the US. In a study released in November, the Convergence Consulting Group estimated that about 400,000 Canadian TV households, or about 3.5% of all TV homes here, have jettisoned their pay-TV subscriptions since 2011.

Likewise, Rogers is looking to attract the growing number of "cord-nevers," mainly younger consumers in their teens and 20s who have never subscribed to pay TV and quite possibly never will because of all the free, or much cheaper, online fare available. Rogers executives have estimated that these consumers already make up nearly half of the Canadians who don't subscribe to a pay service now.

In making this move, Rogers appear to be aping the strategy of Comcast Corp. (Nasdaq: CMCSA, CMCSK) south of the border. Comcast launched its own media streaming service, StreamPix, for its Xfinity TV subscribers, to compete with Netflix. The service costs subscribers up to $4.99 per month. (See Comcast Goes OTT to Target Netflix, Hulu Plus.)

But StreamPix hasn't exactly knocked Netflix for a loop in the US quite yet. Nor has it apparently stemmed Comcast's video subscriber losses all that much. Possibly as a result, Comcast is one of several major US MSOs reportedly negotiating now with Netflix to offer the media streaming king's service to cable subscribers.

— Alan Breznick, Cable/Video Practice Leader, Light Reading

(3)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
albreznick
50%
50%
albreznick,
User Rank: Blogger
1/15/2014 | 12:06:01 PM
Re: Too little,too late?
Sure sounds like it, David. I'm not sure whether Rogers, or just about any MSO, is up to that task. This idea would make a wonderful blog for us, tho. (Hint hint, Nudge nudge)    
David Dines
50%
50%
David Dines,
User Rank: Blogger
1/13/2014 | 5:28:26 PM
Re: Too little,too late?
I do not have the Netflix market share numbers for Canada available so it is hard to know how much of headstart they have.  I would say that Rogers' success is more dependent on their own executiion: the pricing, content library, user interace/ease of discovery, marketing and customer care.  I have noticed that most consumers don't like 1) their cable companies, 2) being nickel and dimed on charges and 3) suprises on their bills.  

Therefore, in order to be a credible competitor to Netflix, MSOs have their work cut out for them.
albreznick
50%
50%
albreznick,
User Rank: Blogger
1/13/2014 | 1:11:33 PM
Too little,too late?
I think this is a good move by Rogers. But I wonder if it's a bit too late. They gave Netflix an awfully big head start in the Canadian market. It might not be possible to cut Netflix off at the pass anymore.
Flash Poll
From The Founder
It's clear to me that the communications industry is divided into two types of people, and only one is living in the real world.
LRTV Custom TV
Distributed Access Architectures – 2

10|21|14   |   8:51:00 AM   |   (0) comments


ARRIS CTO Network Solutions Tom Cloonan discusses why many if not most MSOs will continue with integrated CCAP, while addressing why some are also looking at two futuristic, distributed access architectures: Remote PHY and Remote CCAP.
LRTV Custom TV
Distributed Access Architectures – 1

10|21|14   |   9:01   |   (0) comments


SCTE Sr. Director of Engineering Dean Stoneback discusses the pros and cons of distributed access architecture (DAA) and its various forms, which range from basic Remote PHY to full CMTS functionality in the node.
LRTV Custom TV
The WiFi Road to Riches – 2

10|21|14   |   3:58   |   (0) comments


ARRIS Senior Solution Architect Eli Baruch talks about how MSOs can enable public and community WiFi through 1) outdoor access points, 2) businesses seeking to offer WiFi to customers, and 3) residential WiFi gateway extensions.
LRTV Custom TV
The WiFi Road to Riches – 1

10|21|14   |   10:15   |   (0) comments


SCTE Director of Advanced Technologies Steve Harris discusses WiFi deployments, drivers, challenges and advances, including 802.11ac, carrier-grade WiFi, community WiFi, Hotspot 2.0, Passpoint, WiFi-First and voice-over-WiFi.
LRTV Custom TV
Advantech Accelerates 100G Traffic Handling

10|17|14   |   7:56   |   (0) comments


Paul Stevens from Advantech explains why handling 100GbE needs a whole new platform design approach and how Advantech is addressing the needs of equipment providers and carriers to give them the flexibility and performance they will need for SDN and NFV deployment.
LRTV Huawei Video Resource Center
Holland's Imtech Traffic & Infra Discusses Huawei's ICT Solution and Services

10|16|14   |   4:49   |   (0) comments


Dimitry Theebe is from the business unit at Imtech Traffic & Infra which delivers communications solutions for transportations. His partnershp with Huawei began about a years ago. In this video, Theebe speaks more about this partnership and what he hopes to accomplish with Huawei.
LRTV Huawei Video Resource Center
Huawei's Comprehensive Storage Solutions Vital for SVR

10|16|14   |   6:16   |   (0) comments


SVR Information Technology provides cloud services for academic and special sectors. With Huawei's support, SVR and Yildiz Technical University has established Turkey's largest and most advanced High Performance Computing system. CSO Ismail Cem Aslan talks about what he hopes Huawei's OceanStor storage system will bring for him.
LRTV Huawei Video Resource Center
Mexico's Servitron's Impression of Huawei at CCW 2014

10|16|14   |   6:35   |   (0) comments


Servitron is a network operator in Mexico that has been in the trunking industry for the past 20 years. Its COO, Ing. Ragnar Trillo O., explains at Critical Communications World 2014 that his company has been interested in the long-term evolution of LTE technology and its adoption for TETRA.
LRTV Huawei Video Resource Center
Building a Better Dubai

10|16|14   |   2:06   |   (0) comments


Abdulla Ahmed Al Falasi is the director of commercial affairs, a telecommunications coordinator for the government of Dubai. Their areas of service span across multiple industries, including police, safety, shopping malls and more. In this video, Abdulla talks about his department's work with Huawei.
LRTV Huawei Video Resource Center
Huawei Lights Up Malaysia Partner Maju Nusa

10|16|14   |   1:59   |   (0) comments


Malaysia's Maju Nusa is an enterprise partner to Huawei in networking, route switches and telco equipment. At this year's Critical Communications World in Singapore, CTO Pushpender Singh talks about what Huawei's eLTE solutions mean to his company and for Malaysia.
LRTV Custom TV
Evolving From HFC to FTTH Networks

10|15|14   |   2:19   |   (0) comments


Cisco's Todd McCrum delves into the future of cable's HFC plant, examining how DOCSIS 3.1 and advanced video compression will extend its life and how the IP video transition will usher in GPON and EPON over FTTH.
LRTV Custom TV
Exploring the Future of Cable Access

10|15|14   |   6:23   |   (0) comments


Cisco's Brett Wingo looks at where cable access architectures are heading, discussing the impact of DOCSIS 3.1, CCAP, Remote PHY, SDN, virtualization of cable networks and related technologies.
Upcoming Live Events
October 29, 2014, New York City
November 6, 2014, Santa Clara
November 11, 2014, Atlanta, GA
December 2, 2014, New York City
December 3, 2014, New York City
December 9-10, 2014, Reykjavik, Iceland
June 9-10, 2015, Chicago, IL
Infographics
WhoIsHostingThis.com presents six of the world's most extreme WiFi hotspots, enabling the most epic selfies you can imagine.
Hot Topics
HBO Will Go OTT in 2015
Mari Silbey, Independent Technology Editor, 10/15/2014
Google: Carriers & Cloud Providers Need to Cooperate
Mitch Wagner, West Coast Bureau Chief, Light Reading, 10/16/2014
Could Data Be the New 'Currency'?
Ray Le Maistre, Editor-in-chief, 10/16/2014
iPad Air 2 Lets Users Switch Carriers Any Time
Mitch Wagner, West Coast Bureau Chief, Light Reading, 10/17/2014
CBS Takes OTT Plunge
Mari Silbey, Independent Technology Editor, 10/16/2014
Like Us on Facebook
Twitter Feed