Canadian incumbent BCE Inc. (Bell Canada) (NYSE/Toronto: BCE) launched a new streaming service earlier this week, aimed at the cord-cutting generation. An alternative to its Fibe TV pay service, the new Alt TV service does not require a set-top box and can be streamed to iOS and Android mobile devices, more recent Apple TV models and web browsers.
Positioned as a low-cost option for potential cord-cutters, it starts at C$14.95 (US$10.99) per month for 30 channels, but allows users to add up to 500 channels -- for a total of C$103 (US$75.72 )per month. But only those signed up for the operators "Unlimited" broadband tier, priced at C$84.95 (US$62.45) per month are eligible for an Alt TV subscription.
The Alt TV service also has some limitations: subscribers have no DVR functions, i.e., they cannot record shows for later viewing or pause or rewind while viewing them. It also allows only two streams to be viewed simultaneously by each subscribing home, less than most OTT streaming services.
Bell is launching Alt TV first in Ontario and Quebec, with Atlantic Canada and Manitoba to follow shortly. It follows the launch of Pik TV, a skinny bundle launched by the other major Canadian telco, Telus Corp. (NYSE: TU; Toronto: T).
Cord-cutting is ramping up in Canada, though not at the pace seen in the US so far. Still, operators are fearful that it will have a significant impact in Canada as well, and are looking for ways to maintain their subscriber relationships. (See Record Subscriber Losses for Canadian Pay-TV Providers and Two-Fifths of US Subscribers to Cut Pay-TV Spend, Finds Study.)
The content options and entry price point for Alt TV seem compelling, but eliminating some of the traditional TV service features -- especially the recording and time-shifting functions -- is perplexing. It will almost certainly frustrate subscribers and drive churn -- or just alienate them before they even sign on. It's difficult to understand this decision as younger viewers (presumably the primary target for this service) are even more likely to value on-demand viewing and control over their TV experience compared with the average TV subscriber.
— Aditya Kishore, Practice Leader, Video Transformation, Telco Transformation