Videotron 4K box seen as cord-cutting prevention

Quebecor Inc.’s Videotron announced Tuesday it will be releasing an ultra-high-definition (UHD) set-top-box for its customers, making it the first Canadian telecom provider to commercially release such technology. Videotron said in a press release that the set-top-box processing speed will be 12 times faster than what is currently available in the market, allowing customers to navigate through content choices four times faster, record eight shows simultaneously, and store about 320 hours of standard HD content or 115 hours of UHD content. Manon Brouillette, CEO of Videotron, said in a phone interview that Videotron is already partnered with TV content providers in order to provide 4K content to customers. “I can’t give a number because it’s a number that’s growing every day," she said. "We have all the contracts with major studios and we are working with them, and as soon as they have UHD titles, we will access them and put them on the platform." She said the set-top-box will be available for customers by the end of this month or early September for $399. Videotron said customers who do not own a UHD TV would be able to purchase the new set-top-box, which will still allow them to browse content more efficiently than the older version of the set-top-box. Gord Hendren, president of Charlton Strategic Research Inc., said in a phone interview that it is a natural progression for telecom providers to give customers better technology to watch 4K content, and initially it will be early adopters who opt for this upgrade. “About 22 per cent of the market are early adopters to technology," he said. "They would be the ones who, I would say, would be most interested in this straight off the top. This is thinking progressively about the consumer. This sort of jumps ahead of the consumer in the world that they live in." Hendren added that "it gives a reason to continue subscribing, not cut the cord.” Duncan Stewart, director of research for technology in Canada at Deloitte Touche Tohmatsu Ltd., said in a phone interview that the new technology is “the way of the future.” He said one thing that telecom providers will look at as the technology develops is how over-the-top (OTT) content will get integrated onto the set-top-box system. “This is a crucial thing," he said. "Netflix already offers 4K and therefore, for those who are really interested in 4K, being able to get it on your set-top-box, over time I think, we’re going to see this as table stakes for all cable, telecom and satellite companies. … If you want to stay in the game against the over-the-top guys, you’re also going to have to support 4K,” Stewart said. He noted that Netflix Inc., by bringing in 4K capabilities, has added another way of attracting subscribers, something that telecom companies need to be aware of. “In terms of distributors, they probably need to offer a 4K set-top-box over the next couple of years, but only for those people who want one,” Stewart said. Brouillette noted that Videotron has its own OTT service, Club Illico. But she said that in order to truly enjoy UHD content over the web, you would need a very fast Internet speed. “UHD content is very heavy, so it takes a lot of capacity as well as speed. … It is also very costly. So we decided to go with our current technology, which is more efficient. You purchase the set-top-box and you can access the OTT,” Brouillette said, noting Club Illico is available over Videotron's set-top boxes. Videotron announced last month that it would soon be launching a gigabit Internet service, joining BCE Inc. as being among the few Canadian providers making such a service available. Barry Kiefl, president of Canadian Media Research Inc., said Videotron could use 4K coverage of NHL hockey to get more buyers for its 4K technology. Quebecor's TVA Group has sub-licensed the rights to French broadcasts of NHL hockey games from Rogers Communications Inc., which struck a 12-year deal worth $5.2 billion with the NHL in 2013. Quebecor has also applied for an expansion NHL franchise in Quebec City. Kiefl said more people might get a 4K set-top-box or television if there were a major sporting event behind it. “I think what will happen is some major event like the Super Bowl or one of the sporting leagues will say they’re going to provide a 4K version of it and it will cause the distribution system, the cable and satellite and streaming services to provide this content, and I think that will get everything moving,” Kiefl said in a phone interview. “Now we’re sort of at the stage of early years of UHD where people are buying the set-top-box, but there’s not a lot of content out there yet.” — With reporting by Shruti Shekar at sshekar@thewirereport.caand editing by Derek Abma at dabma@thewirereport.ca

Videotron 4K box seen as cord-cutting prevention

Broadcast | August 11, 2015

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