Netflix Chief Executive Officer Reed Hastings speaks during the launch of streaming internet subscription services for movies and television shows to televisions and computers in Canada, at a news conference in Toronto September 22, 2010.MIKE CASSESE
Canada is rapidly becoming a Netflix nation.
A report issued by the Canadian Radio-television and Telecommunications Commission (CRTC) Tuesday showed 10 per cent of Canadian adults subscribed to the online on-demand movie and TV show service as of last fall, up from 6 per cent the previous spring. That amount has jumped even higher since then, industry observers say.
And as Canadians increasingly turn to the Internet service, they are spending more time each week viewing screens and monitors. Those without the service watch roughly 16 hours of regular and Internet TV each week, while those with Netflix watch about 21 hours per week, including TV, Internet TV and more than five hours of Netflix programming combined.
That shift is all part of the rapidly evolving digital world, in which the broadcasting and telecommunications sectors are increasingly being drawn into each others spheres, climaxing in the growing battle over BCE Inc.'s attempted takeover of Astral Media Inc.
"If you add up all the laptops, tablet computers and smartphones used by Canadians [and capable of streaming video online] it will hit 31 million this year," said Kaan Yigit, president of Toronto-based Solutions Research Group. That will exceed the number of television screens in Canada for the first time.
"It's almost like, from a cultural standpoint, video content is wallpaper now. It's the background, it's everywhere."
The growth in Canada of Netflix, which allows users to stream content across multiple devices for a flat monthly fee, is newly captured by the CRTC in its annual Communications Monitoring Report released Tuesday.
But the data for Netflix, which entered Canada two years ago, is already out of date. Mr. Yigit said his firm estimated as many as 17 per cent of online Canadians now either subscribe or are trying out the service.
The CRTC report also shows the usage of communications technology by Canadians continues to evolve at a rapid pace as the industry consolidates in-step. The Canadian wireless phone market – which accounts for about one-third of all revenues from the telecommunications and broadcasting sectors – appears to be approaching maturity.
There were 27.4 million wireless subscribers in 2011, up just 6 per cent from the previous year, according to the CRTC. That's the lowest annual rate of growth in at least a decade.
Data and roaming charges accounted for the lion's share of growth in the $19.1-billion wireless business last year, while basic voice, which peaked at $10.5-billion in revenues in 2008, has begun to decline.
There were 9.4 million subscribers in 2011 who bought two or more "bundled" telecommunications services from a single provider, almost twice the number in 2007. More than one in 10 Canadian households are now wireless only, while the number that subscribe only to land line service has fallen by more than half in the past decade.
Nevertheless, Canadians have far fewer mobile subscriptions – 78 per 100 inhabitants – than most other industrialized countries, including the United States and France, as well as higher monthly mobile revenue per customer, which critics have said is a result of Canada's protected telecom market.
Several dominant telecom services of the not-so-distant past, including land line long-distance, dial-up Internet and payphones, saw continued steady declines in usage over the past five years, while their usurpers – wireless and smart phones, broadband high-speed Internet – more than made up for the losses. And the humble pager, once ubiquitous, still boasted 219,000 subscribers in 2011, down from 1.3 million in 2001.
Overall revenues for the cable, telephone, TV and radio broadcasting and Internet services were $57.4-billion in Canada in 2011, up 3.3 per cent from the previous year. Broadcasting revenues were $15.8-billion, up 5.5 per cent from 2010, while the telecommunications sector posted $41.7-billion in revenues for a 2.5 per cent gain.
Meanwhile, the CRTC data showed several distinct differences between English and French markets: anglophones spend on average 5.1 hours more a week than francophones on the Internet, while the average revenue per mobile phone customer in Quebec is 13 per cent below the national average of $58.
Despite the evolution of digital media, conventional radio continued to hold its own, as revenues, profits – and even weekly radio listenership – grew in 2011 over 2010 levels.
Sean Silcoff