New streaming services heat up fight for content
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Jan 25, 2015  |  Vote 0    0

New streaming services heat up fight for content

The arrival of Rogers and Shaw’s jointly-owned Shomi service and Bell’s CraveTV demonstrates how far those companies are prepared to go to keep Canadians tied to their existing television ecosystems

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As Canadians are flooded with advertising for new wave of home grown streaming video services, the real battle is happening behind the scenes as these rivals wrestle for new and better content.

The arrival of Rogers and Shaw’s jointly-owned Shomi service and Bell’s CraveTV demonstrates how far those companies are prepared to go to keep Canadian consumers tied to their existing television ecosystems, as well as their determination to prepare for the future if consumers truly embrace these types of services.

“We need to be ready for any eventuality, and we’re taking a step down this on-demand road so that if that’s the way the world goes, we’re going to be in that space,” says Mike Cosentino, senior vice-president of programming for CTV Networks.

“We are recognizing that the on-demand appetite is something that we can’t ignore. We’re going to be in the space so that if it is the wave of the future, we’re going to be entrenched with a product that we feel good about.”

Shomi and CraveTV are referred to in the industry as subscription video-on-demand services (SVOD), and are touted as Netflix-competitors, although both are currently tied to their respective owner’s television operations and are described as complementary services.

CraveTV’s plan is to only be available for existing TV subscribers, although Cosentino says that it has been offered to all TV providers in the country. Shomi is currently still in development or beta mode and is only available to Rogers and Shaw cable and Internet customers, but once that ends, it will be available to all Canadians with Internet service.

These services represent no small investment on the part of the companies. Shaw owns a 50 per cent stake in Shomi and reported an early equity loss of $13 million for their investment in their recent fourth-quarter earnings report.

“We believe it’s a space we have to be into and we certainly want to make sure we’re competitive in that space,” the company’s chief executive Brad Shaw said on a conference call after the earnings.

Both have had splashy launches, and have plans to continue to add content over the next year, and continue to compete to sew up exclusive content.

“Two years ago, there was one player in the market buying SVOD rights, now there are three. Obviously that changes the dynamic and it creates some degree of competition, but we also all have very specific brands and very specific strategies. We’re going to after a certain type of content that we think fits those brands that our customers are going to want,” says Marni Shulman, head of content & programming at Shomi.

One of the benefits for TV fans is that these new platforms provide more shelf space for series that might not have found a home on traditional networks.

“Absolutely, there is a ton of production out there, not only in the U.S. or U.K. and Australia, there’s some great, great content out there. It’s not the type of content that you would typically see on a linear service or that would necessarily find a home on a conventional or traditional linear service,” says Shulman

One needs only to look at the exclusive offerings on the various services. Shomi has Jane the Virgin, which originated on the CW Television network in the U.S. in 2014 but wasn’t initially picked up by a broadcaster here.

Amazon Prime, which is not available in Canada, is a place both Shomi and CraveTV have been competing over content. Shomi is launching the award winning Transparent on Jan. 23, while CraveTV has new crime series Bosch debuting in the next few months.

Both are Amazon originals, and Shomi just announced an exclusive content deal locking up future series from Amazon.

So for those keeping score, Shomi has reached this type of deal with Amazon, BBC Worldwide and Starz.

CraveTV has HBO’s older programming but has also locked up valuable “evergreen content” like Monty Python, Star Trek and Seinfeld. Competition over these exclusive content deals will be what defines these services moving forward.

Netflix is still the elephant in the room, as the company that has popularized streaming video for most people. The company just announced its fourth-quarter earnings last week, touting over 55 million users in over 50 territories in the world.

In August, 2011, the company said it has 1 million users in Canada, but some research has concluded Canadian users could be three times that. Beyond its library of movies and older shows, Netflix has found success with its originals like House of Cards and Orange is the New Black.

One issue that could potentially affect those Canadian subscriber numbers is a recurring suggestion that Netflix will soon crack down on people who use proxy servers or virtual private networks to mask where they are.

Canadian users who do that are able to access content in other countries, like the U.S., which has a larger library. Despite those suggestions Netflix has yet to act.

And the landscape continues to shift underfoot as evidenced recently in the U.S. where Dish Network announced a stand-alone pack of channels, including CNN, ESPN, TBS and more, called SlingTV, which will provide online access to those traditional TV channels in a package $20 (U.S.).

It is specifically aimed at “cord cutters” and “cord-nevers”, the term for young people who don’t have a TV cable plan and probably never will. Announced in early January, it is expected to launch soon and has been touted as the next important step in truly unbundling television into a purely digital future.

Toronto Star

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(1) Comment

By redbaron | JANUARY 26, 2015 03:22 PM
bundled deals are the worst form of marketing possible...these giants are now learning that to compete for market share, they have to start listening to consumers demands and not hold consumers hostage to extortion practices.
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