However, content deals are something of a struggle
TORONTO – Iristel plays in many sandboxes in Canadian telecom.
As a national voice over IP CLEC, it’s a wholesale voice and broadband data supplier (with clients such as TekSavvy, Distributel and Magic Jack). It’s a retail voice and broadband provider to residential and business customers and also a wireless provider.
However, there has been a missing component to the bundle it offers retail customers: Television. Soon, however, that missing bit will be ready for launch, as soon as it can get more content deals signed, that is.
The look and feel of Iristel TV’s user interface (built by its business partner Nextologies) is pretty slick. It has all the bells and whistles one would expect from a TV service with an intuitive guide, VOD and cloud DVR, but despite the screen cap you see of what it will look like, Iristel is still missing the key component: Content.
While its executives don’t want to rattle cages too loudly by naming names (publicly burning bridges in this industry, especially with companies bigger than you, is a no-no) or appeal for regulatory help, Iristel senior vice-president of sales and marketing Rob Khoury told Cartt.ca Iristel TV likely would have launched by now if content owners weren’t so slow in responding to their requests, or insisting on contracts which are needlessly complex.
The main Canadian content owners are stuck in an old way of doing things, says Iristel CEO Samer Bishay. “There are already enough obstacles to do the business itself. And on top of that they add this layer of, oh, you've got to sign all these separate agreements, too,” he explained.
Without distribution agreements from all of the primary content providers who own the most popular channels, it can’t launch. There’s a parallel on the telecom side, Bishay (pictured) added. “Let's say I'm launching (telecom services) in Barrie. What you have to do is find every CLEC (competitive local exchange carrier) operating in Barrie and get them to sign a document to agree to an interconnection,” he explained. “But if one guy delays, you're not able to do business with that one company, so guess what? You can't launch your phone numbers if one company's not going to allow routing to your exchange.”
“It has to be bundled because there's really no money on that level of just a TV layer.” – Samer Bishay, Iristel
“So one guy could sit on it for six months” and your business just languishes. “How does that make any sense? It ties into the whole conundrum with just what we're facing in general,” said Bishay, who added it might be more beneficial if there were standardized pan-industry bulk content agreements which would speed things along.
When Iristel TV launches, it will come to market in a different way than most BDUs, insofar as it will be an add-on to broadband packages sold by either Iristel or one of its agent partners – and it will not come with a set top box or any other hardware. It will be delivered as an app to smart TVs and other devices like Amazon Fire Sticks and AppleTVs.
“It has to be bundled (with broadband) because there's really no money on that level of just a TV layer,” says Bishay.
“Depending on regions, we'll come out in the market either free with high-speed Internet over a certain duration of time for as long as you have the high speed, we'll include a skinny TV product with it,” added Khoury.
“We're looking really to bundle in with other services to give us a little bit more buzz and to get a bit more sticky, and then we'll come up with a premium product, which will have the full breadth of stations or channels that'll be also aggressively priced and as best we can. We're just going to keep it really simple and not do an a-la-carte or too many types of channel lineups,” he continued.
Bishay and Khoury say Iristel TV’s full offering will have 180 to 200 channels, with the most popular ones as well as a large number of ethnic services. “I think there's more money there, more than the regular prime time stuff,” said Bishay.
While offering TV doesn’t work without the bundle of other services, Bishay also envisions a much more flexible video offer in the future for Iristel TV customers. “This is a stepping-stone for us. It's not so much to have the linear TV concept because that's obsolete… except for sports, probably and news. It's a stepping stone to eventually be able to do on-demand linear TV,” he said.
“Eventually, we want to be able to go back to the content providers and convince them that's the model we need to build a platform around and I think that's a direction I want to drive it.” – Bishay
On-demand linear would see Iristel TV customers be able to turn the TV spigot on and off at will and only pay for their linear TV as they need it, where a customer would day “today I want to watch this channel because it has some show that I really want to see… But I want to pay just for the one day,” he explained. Customers who go away for a while would be able to switch off their TV service for those days and save some money on their subscription while they’re gone.
“Eventually, we want to be able to go back to the content providers and convince them that's the model we need to build a platform around and I think that's a direction I want to drive it.”
It's hard to shatter consumer inertia to earn a place in their hearts, though, for many reasons. “We did a big study… with an interesting stat. The number one reason why people do not switch their telephone provider, mainly wireless, is because of the time it takes to call and try to have a number ported,” said Bishay.
It’s the same when it comes to a television subscription, he believes. People are happy enough with what they have and only switch for big reasons like a move, or a malfunction. “I'm guilty of that because the only reason I called and cancelled my Rogers TV was because the cable box died one day. I came to turn it on and it didn't work. That's when I made the call. But I wanted to cancel it for a year, but I just said, ‘Tomorrow, tomorrow’.”
When Iristel TV launches in Toronto, Montreal, Eastern Quebec and Newfoundland later this year, Bishay is hoping enough consumers will make that tomorrow, today – as long as it can get the content it needs as soon as possible.
