Canada’s Largest Cable TV Providers Team Up To Rival Netflix and Other Streaming Services

Canada’s two largest cable television providers – Shaw and Rogers – have come together to develop a Netflix competitor. Between each company, they have lost about 200,000 subscribers in the last year.

In the latest quarterly report from Rogers, the company lost 111,000 television subscriptions in the last year. That equates to around five percent of their customers. During this same time period, Shaw said it lost 82,000 customers or about four percent of the company’s total subscriber base.  Shaw Direct, a satellite TV service, said it lost 6,600 customers itself.

If the numbers that Rogers and Shaw are experiencing is typical, it means that about one in 20 homes in Canada ditch cable TV.

Both companies have managed to offset a bit of their losses by working together and gaining Internet subscribers. Shaw saw 71,000 stand-alone Internet customers while Rogers saw an increase of 51,000 new Internet subscribers. Stand-alone means people obtained Internet service but not cable.

Rogers’ earnings were below the expectations – a slide of 28 percent compared to a year earlier of the same quarter. Revenue for cable dropped one percent. Shaw, however, saw a 64 percent increase in its profits, partially because of the lower expenses. Due to price changes, it also had a 2.3 percent increase in cable revenue.

This earnings report is a prime example that cord-cutting is having on the industry. According to Canada’s telecom watchdog CRTC, 2013 is the first year in which there was a significant drop in cable subscriptions for the country.

And, there’s no doubt that Rogers and Shaw has taken notice. They have come together to develop Shomi, which is a video-streaming service that’s meant to gain the attention of people putting their attention on Netflix, Amazon and other popular streaming services.

Despite being competitors, Shomi and Netflix is already content partners. CityTV, which is owned by Rogers said it made a deal with Netflix to carry “Between”, a Canadian Sci-Fi thriller.  Broadcasters – CBS and HBO, for example – are also looking at getting into the streaming business by offering their material through a streaming service that sidesteps cable providers.


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