Cable / Telecom News

Rogers banking on IPTV to start reversing video erosion in 2017

Guy Laurence by David Leyes.jpg

Three key wireless drivers are “video, video and video”

TORONTO – It was a quarter of good news at Rogers Communications as wireless subscriber additions – and media results – beat expectations for the three months ended June 30, 2016.

While its cable division’s revenue and profit were flat compared to Q2 2015, the company did lose 104,000 customers over the 12 months, not surprising given the heavy promotional activity from the likes of Bell Fibe taking customers as well as some cord-cutting.

As we have reported in the past, however, help is on the way in the form of Rogers IPTV service, which it is now testing with select employees. “We expect to introduce IPTV at the very end of this year and this will give us the service we need to start winning back video customers,” Rogers CEO Guy Laurence told financial analysts in a conference call this morning. The service will go public “in the dying days of the year. We'll put it out there with the public to check everything works and then we'll scale it through 2017,” he added.

“We are confident we can start to make a turnaround in cable in 2017.”

However, while this project has taken much longer than those inside Rogers had hoped, Laurence – who gave a sneak peek of the service to Bay Streeters last month – said it will launch when he decides it’s ready.

“We will launch it when it’s ready and we have said… we’re targeting the end of this year and again, if I’m not happy with it, we’ll put it back a few weeks or a month or whatever it takes,” he told reporters in a conference call with journalists Thursday morning.

It’s not a simple product to bring to market because of the different skill sets required. This isn’t regular RF cable. The technology doing the delivery is different and so hundreds of technicians will have to be trained to make it work while thousands of customer service reps will need to know the user interface backwards and forwards.

“I would say the user interface tends to look more like the kind of services that they consume via the Internet.” – Guy Laurence, Rogers

While the company has been tight lipped on what it might look like and Laurence wouldn’t divulge any details, consumers can likely expect a far better, quicker, more attractive user guide, a much smaller set top box and advanced features like cloud-DVR. “I would say the user interface tends to look more like the kind of services that they (millennials) consume via the Internet, but we’re not banking on bringing cord cutters back,” added Laurence, “but I also wouldn’t rule out some of them seeing the advantages of the new product, either.”

WHILE VIDEO IS behind the IPTV push, the same thing is driving wireless growth, too, he said. Consuming more and more video with bigger wireless data plans has powered growth in the company’s largest division..

When asked by one of the analysts if the Pokémon Go craze was stressing the wireless network or causing more data consumption, Laurence poked a hole in that theory noting the game doesn’t really use a lot of data at this point.

“The real wireless use case… is video,” explained Laurence. “There are three use cases – video, video and video… if you look on your Facebook stream, pretty much every other post is now a video and therefore, especially with auto-play, it means that the real base growth is coming through from that kind of service. And whilst it's always interesting to see these things like Pokémon Go erupt, it shouldn’t alter your models right now.”

File photo by David Leyes, Toronto.