Google TV could face fight for content rights in Canada

Google Inc. launched its latest product, Google TV, in the U.S. this month in a bid to integrate keyword search, aggregation and Internet access into television viewing—a move that is expected to set new precedents for the television user experience. But the new service is also expected to set up a fight over content rights if major Canadian programming owners try to protect their programming from access by third-party, digital distributors. Some observers expect the company to have more difficulty securing content access rights in Canada than in the U.S. “Those programs are being licensed for conventional broadcast in Canada and the broadcasters are scooping up the Internet rights in the process,” Michael Geist, law professor and Canada research chair of Internet and e-commerce law at the University of Ottawa, wrote in an email to The Wire Report. “You don't have the same phenomenon in the U.S.” Google TV offers full Internet access through the Google Chrome browser and lets consumers use search to find their favourite TV shows or online content--on their TVs. The search aggregator combines search results from public websites, subscription services like Netflix, and programming from regular cable or satellite television feeds, into a single window on television sets. The platform takes the company’s popular Android operating system--found on on mobile phones and the Chrome browser--into people’s living rooms through specially built Sony televisions or a Google TV set-top box by Logitech. In the U.S., Google struck a deal with Dish Network Corp. to give the satellite provider’s 14.3 million customers access to the Google TV platform. It went into effect with Google TV’s U.S. launch on Oct. 17. The deal will allow Dish customers to find programs—through the Internet or Dish Network programming—using keywords rather than their television guides. Google has also partnered with online content providers like Turner Broadcasting to give users access to services that are not available through traditional cable or satellite packages. Turner has optimized many of its program websites for Google TV, including websites for TBS, TNT, CNN, Cartoon Network and Adult Swim. Google TV also allows subscribers to access the popular Netflix service to stream their movies and television shows on their televisions. Erin Fors, a spokeswoman for Google, told The Wire Report in an email that Google TV will launch internationally next year, but that the company has not yet announced in which markets. In a phone interview, Geist predicted that rights to online content will become more valuable over time and that content owners could negotiate online rights separately from traditional broadcasting rights. “What you’ll see is that those licensing into the Canadian market are not willing to essentially throw in Internet rights as part of the package,” he said. “If we start seeing walled gardens established, that can raise some real concerns over the ability of some other providers to compete." Canada’s largest communications companies have moved increasingly toward vertical integration between the distribution and creation of content. Most recently, Bell Canada Enterprises Inc. announced plans to acquire full ownership of CTV Inc. On Sept. 21, 2010, the first day of CRTC hearings to review Shaw Communications Inc.’s $2-billion purchase of Canwest Global Communications Corp.’s broadcasting assets, Brad Shaw, Shaw’s executive vice-president, said vertical integration would help Shaw compete against international “over-the-top” television players like Google. “Vertical integration is critical to competing with over-the-top applications offering unregulated, on-demand viewing alternatives to Canadians across various platforms, including broadband and mobile devices,” Brad Shaw told the commission. “Google's market cap is over $150 billion alone,” he added. “These companies own and have sufficient bargaining power to licence rights in the world's most popular content.” Shaw said strong, vertically integrated Canadian companies will be well-positioned to acquire content rights for all platforms in the face of competition from Google and other multinationals. Google TV will allow users to download Android applications expected to enhance the TV experience. The NBA, for example, has created a Google TV application called NBA Game Time that permits users to follow real-time NBA game scores while watching a program. But Google will not open the Android application store for Google TV until next year. Right now, there are a limited number of applications available for Google TV from partners such as the NBA. “I think what we’ll see is much better user experiences than what the industry has come up with so far,” Trevor Doerksen, CEO of MoboVivo, a Canadian company that helps media companies manage and monetize video on wired and wireless devices, said in an interview. Doerksen said that innovations in how people watch television could be as important as the content they watch. “That competition at the user experience level is going to be perhaps even more interesting than competition at the content level,” Doerksen said. James McQuivey, an analyst with Forrester Research Inc., wrote in a report this summer that he expects Google TV to be successful. “We think that Google TV is going to work,” McQuivey wrote. “But there’s one inconvenient snag. If you pay close attention to how Google sold the idea of Google TV, it’s not clear that the firm understands what it means to bring the Internet to the TV.” McQuivey said Google will need to put the television experience and video content ahead of the traditional Internet experience. “Our biggest proof comes from the millions of people who connect a PC to the TV today,” McQuivey wrote. “Our data shows that the top behaviors that people engage in with a TV-connected PC are clearly video and media-related.” A Forrester poll found that 70 per cent of people who connect their PCs to their TVs do so to watch video content on a larger screen. In an interview, Duncan Stewart, director of research for technology, media and telecom at Deloitte Canada, likened the competition between over-the-top television services to the war between VHS and Betamax in the 1980s, saying that many consumers will want to wait for a clear winner before they commit to a product. He said he does not foresee a service like Google TV being successful in Canada for another couple of years. “We’ve got data from around the world that shows people still overwhelmingly watch linear ,” Stewart said. jmigneault@thewirereport.ca

Google TV could face fight for content rights in Canada

News | 10/20/2010 10:11 pm EDT

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