Vidéotron Ltée has unveiled a new weapon in the increasingly fierce fight for Quebec television viewers – a cable box that makes it easier for viewers to find their favourite shows.
While the cable giant and its rival BCE Inc. have been battling for subscribers for years, a recent burst of innovation has accelerated the competition and led to a slew of new services that aren't yet widely available in the rest of the country.
Their networks, once intended to handle a single form of communication, are now being leveraged to offer Internet, television and phone services at once. Billions of dollars are at stake as the companies try to sign customers to long-term contracts that take advantage of all their different product lines.
"This is about keeping some existing subscribers to our satellite services, home phone subscribers or Internet," said Nicolas Poitras, vice-president of marketing at Bell Canada, a unit of BCE. "But it's more about adding net new subscribers by offering something that isn't similar to anything else being offered anywhere in the country."
The two companies are also competing fiercely for the content that makes the fibre and cable connections valuable. Vidéotron's parent company Quebecor Inc. has specialty channels such as TVA and a vast newspaper empire, while BCE has CTV and recently announced a $3.8-billion deal to buy Montreal-based Astral Media Inc. and its television and radio stations.
"The coming together of Bell and Astral puts us now head-to-head with our competitors in the marketplace," BCE chief executive officer George Cope said when the deal was announced on March 16.
BCE covered Montreal in fibre-optic cable last year, extending connections to every house in the city in an unprecedented Canadian network upgrade that saw Internet speeds skyrocket and television offerings multiply. It followed with Quebec City earlier this month, investing $225-million to bring fibre into every home in the city.
Vidéotron, meanwhile, has spent the past three years designing a new interface for its cable subscribers. It unveiled the new features and a new set-top box Tuesday, saying that the interface is about "bringing the iTunes experience" to someone trying to find their favourite show on their home television.
"We didn't see anyone else in the world doing what we wanted," says Vidéotron chief executive officer Robert Dépatie. "We wanted to put an iTunes look on your TV. Our search engine is three times faster. It is intelligent. And for this, you will pay less."
BCE doesn't release subscriber information for Quebec. Vidéotron had 1.8 million cable television customers at the end of its last reporting period, including 1.4 million subscribers to its digital service.
Its new box will allow those customers to download movies faster, find things more easily and use Apple-like apps on their television screens. Five hundred Vidéotron employees contributed to the project, which is now available across the province, a key differentiator for the cable company.
"Yes, Bell has deployed fibre," Mr. Dépatie said. "But they are not everywhere. [Our improved offering]is available in 99 per cent of the territory. There's no need for a full installation – you just go to the store and plug it in."
Nonetheless, BCE insists the Vidéotron offering is just "putting makeup on an existing service," because the technology still runs on traditional cable that is nowhere near as fast as fibre.
"They can talk about their new colours and new guides because they can't talk about recording four shows at the same time or using Twitter and Facebook on the television," said Bell's Mr. Poitras. "I guess that's all they can show because that's all they have."
HOW THE SERVICES STACK UP
ILLICO TV NEXT GENERATION
What it is: An improved cable box that allows for more interactivity through a simplified user interface.
How it works: Plug and play on existing cable network.
What it offers: A new design allows pay-per-view viewers to browse movies by their posters, a search bar that is three times faster than before, one-touch recording, and on-screen apps for things like weather.
What it is: A television service from Bell Canada that doesn't rely on a satellite dish.
How it works: Bell has run fibre-optic connections directly to houses in Montreal and Quebec, connecting them to a high-speed Internet network that can deliver television, phone and Web browsing.
What it offers: Because of the fibre connection, Bell is the only company that offers a central PVR that works on every TV in the house. Because it's on a network, it can also offer services such as Facebook and Twitter.