GATINEAU – The broadband video portal Rogers Communications will launch later this year will not only be a boon to Canadians looking for high quality broadband video, it will dramatically reduce the heavy transport and promotional costs for Canadian broadcasters which are making their content available online, company officials said today.
Cartt.ca has previously reported on Rogers’ planned portal but Rogers Cable’s vice-president and general manager, television, David Purdy, put some more meat on the bones in front of the CRTC’s broadcasting in new media panel this morning in Gatineau.
“Today, over-the-air broadcasters distribute much of their content free online. They do this to keep their viewers happy and loyal. Viewers who have missed their favourite episode want a chance to catch up, but they are not willing to pay for the privilege,” said Purdy in prefacing his explanation of Rogers’ plans. “The business case is difficult because online advertising revenues are low, and it costs serious money to transmit programming online. With traditional broadcasting, the costs are fixed and do not depend on the size of the audience. With Internet broadcasting, the more viewers who watch the content, the higher the cost. A very popular show can be very expensive to air online.”
Purdy said the new portal won’t just be a wide open video site but will instead be built off of his company’s existing billing relationship with customers but won’t matter which ISP they use. That will mean, for example, a Rogers basic cable customer would be able to gain access to the broadband content their basic channels choose to make available on the Rogers portal – even if they use Bell Sympatico as their ISP.
If a cable customer has more channels in their existing tiers, content from those brands will be made available to them via the Rogers portal.
“The service will reduce distribution and promotion costs for all programming services,” added Purdy. “Rogers will provide them with the servers and Internet access they need at a greatly reduced cost. This will improve the business case for all Canadian programmers – be they over-the-air broadcasters or pay and specialty services – to put their content online.
The cable and wireless company will also make their video on demand content available through what the alliterative commissioners began calling “the Purdy Portal” this morning.
This model would preserve the cable subscription model and eliminate the need for specialty and pay channel owners and other content providers to decide what to place on line, since with this portal, everything can go because the content will just be going to paying customers anyway.
Instead of worrying when an “over-the-top” TV provider will claim the broadband space in Canada, Rogers has chosen to occupy that space itself.
“Canadian pay and specialty services will be able to put their programming online knowing that it will only be viewed by customers who have paid to watch their linear television service. The online service will therefore not compete with their linear television service,” Purdy continued. “Indeed, it will give increased value to Rogers Cable customers. These viewers will be able to watch their favourite shows when they want, where they want, at no additional cost… This service will improve the value of the traditional TV platform and reduce churn. This, in turn, will keep viewers connected to the Canadian broadcasting system.”
And Purdy, who has been meeting with many companies, hopes the whole industry will buy-in. “The wider this is adopted by the industry, the more likely we can hold on to that dual revenue stream,” he said, referring to the subscription and ad revenue earned by specialty channels.
“This is just an extension of your linear TV offering.”
– Greg O’Brien
