THERE ARE TWO Canadian TV carriers who offer Netflix to their customers directly via their advanced television set top boxes: Cogeco Cable and Telus Optik TV.
After seeing a recent demo of Optik TV’s impressive capabilities and living with the Cogeco TiVo system for several months, it’s become impossible to imagine what all the other carriers could possibly be waiting for. Offering Netflix to existing customers this way is an utter slam dunk.
While my wife was once ambivalent about our cable subscription and asked repeatedly if it was worth what we pay, I’d have to move into my car if I ever tried to get rid of our TiVo system – and most of her enthusiasm (mine, too) has to do with the seamlessness of its Netflix integration. Prior to making the switch, from the “regular” Cogeco digital cable system and its Pace DVRs, we viewed Netflix through our Apple TV box, or our Boxee, our laptops or tablets – and even via the Cartt.ca Chromecast.
They all work, but they’re all a little clunky by comparison to TiVo. The Apple TV box seemed to constantly need updating and there was a several step process to get the other devices in sync with our not-so-smart TVs. The Cogeco-TiVo user interface is not as good as Optik’s, but with Netflix integrated on the set top we can search for content across the cable channels, Cogeco VOD and Netflix (and YouTube, too) with one single remote. There’s no jumping from menu to menu or input to input, or device to device; we simply use this one piece of easy-to-use technology which is actually tied into all three of our TVs, extending Netflix (and any DVR’d content) to each of our big screens. It's even easier than having Netflix directly tied to a smart TV.
It’s not cheap, but the Cogeco-TiVo platform it is now the “stickiest” piece of technology we use. In fact, we have not turned on the Apple TV even once since getting the TiVo box – which also means when we rent certain movies, we have now resumed getting them from Cogeco’s VOD library instead of iTunes.
“If you don’t embrace change, then customers will find other ways to get what they want.” – Louis Audet, Cogeco
And don’t just take the O’Brien family’s word for it. At the TD Securities Telecom and Media investors conference Wednesday, Telus president of consumer and business solutions David Fuller sang the praises of having Netflix on his company’s IPTV box, noting the churn among households who use Netflix is “far lower” than the rest of the company’s TV base.
Among Optik TV customers, Netflix is showing a 46-48% penetration rate (where nationally, the penetration is thought to be about 30-35%) and it’s “snappier and faster than even AppleTV – and customers can get it on any TV in their house,” he said. Plus, the folks subscribing to Netflix love all video. “The vast majority of those interested in OTT are also interested in pay TV,” Fuller added.
Cogeco CEO Louis Audet spoke at the same conference and added: “If you don’t embrace change, then customers will find other ways to get what they want.” He didn’t release any numbers, but he added that his TiVo customers who use Netflix “typically take bigger video packages and not smaller video packages, which is interesting,” and they will often upgrade their Internet packages, as well.
“Our view is that this will keep customers with us,” Audet added.
So, why isn’t the rest of the industry on board already? Sure, neither Cogeco nor Telus own their own TV content and it’s thought that the vertically integrated companies Bell, Rogers and Shaw don’t want Netflix too close lest it impact sales or viewership of the likes of Bravo or Crave or shomi or Food Network.
But given the early, very positive, experiences of making OTT content more seamless and easier to access for customers (turning them into happy viewers), continuing to hold Netflix out of cable channel lineups just no longer makes sense.
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