Rogers CEO discusses many challenges now facing Canada’s cable industry

John Tory, president and CEO of Rogers Cable Inc., recently spoke about the challenges the cable industry faces in the current environment. Appearing at the Conference Board of Canada 2002 Business Outlook conference this month, he reiterated some key cable concerns, including television signal piracy, over regulation, technological changes and direct-to-home satellite TV competition. Below is an excerpt from his speech. …I am going to try to focus on giving some insights into the challenges we have faced in developing our plans and strategies in the current environment...I start from the premise that long-range planning is more difficult than ever, given the pace of change we are facing in just about every industry. ...Advances in computing and communications technology are dramatically impacting on just about every business, expanding the reach of virtually every company to a global reach, impacting on manufacturing and distribution arrangements and even impacting on the very structure of companies and the levels of management they need, or perhaps more precisely don’t need, in order to get the same job done. …In our case, innovation and greater efficiency are going to be the key to our growth going forward, growth which must be achieved in a former monopoly business which now has multiple competitors. In speaking with our employees at Rogers Cable, we all agree that our number one goal is customer retention. We have a significant presence in the markets we serve, but competition is upon us, some legal and some not…and so retaining our customers will be an important challenge. We must retain them not so much so our business won’t diminish in size, but because they represent the platform, the foundation upon which we must build the suite of new products which will produce the growth of the new decade. …If anything we are going to have to step up the level of our commitment both to innovation and to greater efficiency in the coming months…Our three licensed Canadian competitors, two satellite companies and one wireless cable company, have done a great deal to spur us on to innovate, to cause us to focus on the value equation of the products we sell and to increase our commitment to efficiency and to improved customer service. …From the beginning these companies used a combination of new technology, more favourable packaging and pricing rules, and simply the fact they weren’t cable companies to kick start their growth. As time went on and the so-called low hanging fruit had been picked, they began to spend literally hundreds of dollars per customer to buy market share from us…Ultimately, the decision as to whether to continue with that strategy or not will rest with those companies and their investors, and I am confident that more rational competition will become a financial necessity for them as we go forward. …We also face illegal competition from the increasing numbers of dishes Canadians are choosing to put on their homes, usually in order to receive U.S. programming we are not permitted to distribute. Often times. Canadians think when they hear us complain about the so-called black market satellite dishes that we are opposed to them because we don’t want any competition at all. In fact, our desire is to ensure that we have fair competition, and that we have a competitive environment in which all of the participants are playing by the same rules, and obeying them. …Our vigilance as business leaders is necessary, not to fight television signal piracy, but to try to keep the focus of governments and regulators on the really big issues, and away from the kind of minute regulation which seems to be making a comeback. Several years ago, I think Canadians understood the fact that if government regulation continued to smother businesses of all kinds, then we would be less able to compete in an ever expanding, ever more open market. Consequently, a push was initiated to reduce the regulatory burden, to focus on the things that are really important and to do away with excessive red tape and paperwork. Well, I think a refresher course is probably in order, as we see more and more signs that the regulatory burden is in fact increasing again...

Rogers CEO discusses many challenges now facing Canada’s cable industry

Broadcast | October 10, 2002

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