Let distributors experiment with online, on-demand TV, Bell tells CRTC

BCE Inc. division Bell Media is not concerned about potential competition issues from Quebecor Media Inc.'s new illico Club Unlimited service online as broadcast distributors experiment with online and mobile TV services, Bell said. Bell filed the comments with the CRTC in response to a competition complaint from Astral Media Inc. that said Videotron's new Club Unlimited video-on-demand service, available online, on mobile devices and through Videotron set-top boxes, would “directly compete” with Astral's pay TV service Super Écran because it is available on set-top boxes. Bell, which has filed a proposal with the regulator to acquire Astral for $3.38 billion, said Canadian broadcasters have to win over Canadian consumers by offering their own online, over-the-top platforms, which are currently deregulated. “Made-in-Canada OTT services must be experimented with, and encouraged and supported by the Commission in order to combat the challenges posed by foreign OTT providers, such as Netflix , AppleTV's iTunes, Google 's YouTube Movies, Microsoft 's Zune and Sony 's Crackle, who do not have the same expenditure and exhibition obligations as CRTC licensees,” Bell said in the regulatory filing submitted Monday. Astral said in its complaint that, according to CRTC decision 2011-59, broadcasters cannot offer a video on-demand TV service through a set-top box if it is “directly competitive” with a genre-protected linear or specialty channel. Astral's complaint is not directed at Club Unlimited's availability online or on mobile platforms. Quebecor’s new $10 per month subscription video-on-demand service launched in February and offers a regularly updated catalogue of movies, television series, children’s programs, documentaries, comedy shows and concerts, mostly in French. In a speech March 8 at the Prime Time conference in Ottawa hosted by the Canadian Media Production Association, CRTC Chair Jean-Pierre Blais said the illico over-the-top subscription service—among others such as Rogers Communications Inc.'s Anyplace TV, Shaw Communications Inc.'s Go service—were examples of “experimentation and risk-taking” in the broadcast sector. Bell said it is not concerned about the Videotron Club Unlimited online service though the offering via set-top boxes goes against the commission’s regulations for video on-demand services. Quebecor said in a response filed with the CRTC Monday that the complaint shows Astral's desire to protect and expand a monopoly on pay TV services. Videotron launched Club Unlimited as a response to “aggressive” initiatives by over-the-top services in the Canadian market, such as that of American company Netflix, Quebecor said. Richard Paradis, president of media and consulting firm Groupe CIC in Montreal, said in a phone interview Wednesday that these new online services offered by the TV providers are part of a subscriber retention strategy, as the TV providers require customers to have a monthly television subscription to receive access to their online and mobile TV platforms. “They’re trying to have consumers believe that it’s really an alternative to a foreign, service,” Paradis said. “But at the end of the day, somebody who’s buying Netflix through the web is getting a service for $8,” he said, while TV providers' over-the-top services require the cost of a cable subscription. “There’s a lot of confusion in the marketplace on what’s really an service,” Paradis said. The Wire Report last week reported annual subscriber figures for Canada's largest, publicly traded communications companies, which showed growth in Internet-protocol TV services, thousands of net cable TV losses, and, nationally, an overall tumble in TV subscriber growth. Media Technology Monitor (MTM), a joint-research project between CBC/Radio-Canada and BBM Analytics, also said in a survey released last week that the number of people in Canada who do not have a TV service has doubled over the past three years. Bell said in its CRTC filing that Club Unlimited's feature films alone “overlap” with Astral's Category A service Super Écran, making the two services “directly competitive.” The company said Videotron made it “very clear” that it intends to compete with Super Écran. Quebecor said it studied the commission’s regulations for video on-demand services prior to the launch of Club Unlimited to ensure that it conforms to all aspects of the commission’s regulations for video on-demand services. Quebecor said Astral may have been motivated to file the complaint because Videotron's Club Unlimited launch coincided with the release of Astral's new TMN Go mobile application for Apple Inc. iOS devices. On Feb. 27, Astral said the app would offer more than 1,500 hours of content from The Movie Network, HBO Canada and TMN Encore at no additional charge to customers who subscribe to them through TV packages. “There is reason to question the motivations that have led a business like Astral to file a complaint without regulatory basis a few hours before issuing a press release announcing the launch of its own video streaming service,” Quebecor said. Rogers also said in comments filed Monday that Astral’s complaint is “without merit and should be dismissed” because there is not sufficient evidence that Club Unlimited competes with Super Écran. Astral’s final reply comment is due March 25. —With reporting by Danika Grenier at dgrenier@thewirereport.ca and editing by Simon Doyle at sdoyle@thewirereport.ca

Let distributors experiment with online, on-demand TV, Bell tells CRTC

News | March 20, 2013

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Let distributors experiment with online, on-demand TV, Bell tells CRTC

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