Like other telcos, Telus wants VOD licence for its planned digital TV service

Telus Corp. hopes to offer video-on-demand (VOD) when it launches its digital television service over broadband possibly later this year. As the telco awaits the CRTC’s decision on its licence applications to provide digital TV service in British Columbia and Alberta (CCR, March 13/03, Sept. 26/02), its VOD application has been gazetted and is slated to be considered at a June 16 public hearing in Edmonton (CCR Update, April 16/03). Mark Pezarro, Telus’ VP of broadband applications, tells Canadian Communications Reports that it’s possible that VOD could launch at the same time as the telco’s TV service. "If we get a positive decision from the commission, we hope to be offering the service later in the year," he says. "We think VOD is an important element, and we think it’s something that customers will appreciate. It’s certainly something that our cable competitors will offer, so it’s something we’d very much like to be able to offer our customers." Telus has applied for a national VOD licence, which it says it will deploy initially on a stand-alone basis on its own TV services in British Columbia and Alberta. But it also sees potential in offering the VOD service in conjunction with other broadcast distributors and has thus applied for a national licence. Pezarro says no distributors have expressed an interest to date in working with Telus on VOD, but notes "it’s an option that we would like to explore if there is interest out there." In its application to the CRTC, filed in August 2002 and gazetted by the CRTC on April 10 (Broadcasting Notice of Public Hearing 2003-4), Telus projects VOD revenue of $75,137 in year one of its licence, increasing to $20.6 million by year seven. Its operating and promotional expenses are expected to be high, however, with the company anticipating spending $1 million in the first year of operation and increasing that amount to about $10.6 million in year seven. After two years of losses, Telus projects earning a profit of $596,287 by year three. The projections are based on average monthly VOD buy rates of 0.19 titles in year one, with the number rising to 0.74 by year seven. It projects having 20,445 customers to its digital TV service in year one, with that number ballooning to 452,882 in year seven. Telus states in its application that its "initial target audience will be the same customer base served by Telus BDU (broadcast distribution undertaking) licence." The company gives no indication on how much it will charge for VOD titles, saying only that prices will vary "according to the category and genre of programming as well as market forces." Telus’ VOD application is the first by a telco to be gazetted. SaskTel has told CCR that it has also applied for a VOD licence, and Manitoba Telecom Services Inc. (MTS) last month indicated that it was in the process of filing its own application. Like SaskTel and MTS, which have already launched their TV services, Telus says negotiations with Shaw for the carriage of pay-per-view aren’t going well (CCR, March 27/03). "We’ve had some initial discussions (with Shaw), and so far they haven’t been particularly fruitful," Pezarro notes.

Like other telcos, Telus wants VOD licence for its planned digital TV service

News | 04/25/2003 4:00 am EDT

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