IPTV seen cutting into cable, satellite in Canada

Telus maintains hold on market with 56% market share
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While news about IPTV growth in the United States is generally muted (with the exception of new players like Sony and Intel trying to get into the space), things are a little hotter north of the border. A report by IHS Screen Digest Television Intelligence reports "IPTV is rapidly gaining momentum at the expense of incumbent cable and satellite services" in Canada, where OTT is having a tougher time getting a toehold.

The report noted that 9.6 percent of Canadian pay TV subscriptions were with IPTV providers in the third quarter--a 3 percent climb over the 6.6 percent who were signed on to IPTV services in the third quarter of 2011 and a huge jump from the 1.6 percent of Canadians who had IPTV in the third quarter of 2007.

Part of the reason is the availability of IPTV throughout the country as telcos roll out the video service as a complement to existing broadband and voice services and as a way to compete with encroaching cable and OTT offerings.

"Canadian telcos are adding IPTV subscribers at a rapid clip as Telus (Toronto: T.TO) and Bell Canada (NYSE: BCE) engage in the large-scale build-outs of their infrastructure in order to reach more potential customers," Erik Brannon, analyst for television research at IHS, said in a news release. "IPTV will continue to make strong gains in Canada in the coming years, eroding the dominant position held by the cable and satellite services."

The figures seem to back up Brannon's conclusions. Bell Canada's Fibe TV service added 42,973 customers in the quarter and went above the 200,000 total subscriber mark. Bell Canada now owns 18 percent of Canada's IPTV subscribers, ahead of Aliant, SaskTel and Manitoba Telecom, which each had less than 10 percent of the market. Telus continued to dominate with a 56 percent market share.

While IPTV is making inroads, the entire Canadian pay TV industry is holding its own against OTT thanks to "strict data caps and limited OTT options," IHS concluded. That situation could change and become more like the United States, where cord cutters are seemingly snipping both cable and telco wires, "if data caps start to loosen up and broadband subscribers continue to increase," the press release said.

It's worth noting that even with all these new IPTV customers, Netflix has already counted more than 1 million Canadian subscribers.

For more:
- IHS Screen Digest issued this press release

Year in Review 2012: Year-in-Review 2012: IPTV goes, and stays, on an international growth binge

Related articles:
Sony said to be mulling own pay TV service in U.S.
Intel threatening to enter set-top box business

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