TV is dead? Yeah, right

We can see the numbers as well as anyone. Each quarterly report shows cable companies are losing television subscribers.

Many people are migrating to IPTV services offered by telephone companies, which are aggressively marketing an alternative to cable, even though what they are providing is essentially a different type of cable with a few more Bells (pun intended) and whistles.

The novelty factor could wear off soon with cable providers stepping up their own game; Cogeco last year began offering TiVo (subs only), Rogers is planning its own IPTV service and Shaw intends on utilizing Comcast’s X1 platform for its TV customers.

Still, many people are leaving “television” services altogether. Boon Dog Professional Services issued a report last month showing that Canada’s publicly traded providers of TV service — even when factoring in the growth of IPTV — lost a combined 153,000 customers during the first three quarters of 2015. That was seven times higher than it was a year earlier.

The numbers could escalate further next year. In fact, this might be a structural trend that becomes more pronounced in future years, considering the fact that younger people are the ones less likely to subscribe to TV service.

Then again, some research indicates many of people who forgo any kind of TV service will give it a try next year when new regulations kick in that ensure cheaper starter packages and more choice over the channels they get.

During the CRTC’s Let’s Talk TV hearing in 2014, Rogers’ regulatory vice-president Ken Engelhart said that the TV system, as we know it, could survive another two years or another two decades — but make no mistake, its days are numbered.

Engelhart was not saying the practice of watching some kind of story, sporting event, informational program or live entertainment on an electronic screen with sound is dying. Rather, he was talking about the way video content is delivered to your home. He feels the closed connections between homes and their TV service providers will eventually be replaced by a distribution model that involves the Internet.

The popularity of online streaming services such as Netflix, and efforts by major Canadian media/telecom companies to compete by offering services like Shomi and CraveTV, are likely indications of where things are going.

We’ve also witnessed some jarring changes with over-the-air TV operations, most recently at CHCH and CTV. You might view this as another sign that the boob-tube business is going belly up, but you would be mistaken. The business model behind conventional TV, where advertising is relied on for virtually all of the revenue, is broken.

But we must keep in mind that people still spend a great deal of their lives watching screens for entertainment. It just seems more of it is being done online. One can understand why the Internet is an appealing way for companies to get TV content to people. Businesses can avoid mandated Canadian-content quotas and all kinds of other hoops the CRTC makes companies jump through for the privilege of a broadcasting licence.

Yet, some people would rather watch content on the living-room TV than a tablet or computer, and they don’t feel like trying to figure out what gadget will get an Internet signal to the main set. Traditional TV subscriptions hold some appeal for these people. Many providers, such as Bell, Telus, Rogers and Cogeco, now help you connect the TV right to Netflix through the set-top box. Yet, the real and perceived hassle of connecting Internet to televisions, especially as more of them become “smart” TVs, should lessen in future years.

The plumbing behind the infrastructure might change, but we will remain a TV-obsessed culture. Look at the evidence. Great inventions like the Internet come along and what do we do with it? We find a way to use it for TV. Even the latest buzz about virtual reality is how it can be used to access TV content.

People will — for the duration of my lifetime and many generations into the future — continue to be entertained by electronically generated images that tell a story, inform or provide some form of entertainment, whether it’s on a movie screen, a television set, computer, smartphone, tablet or maybe even a 3D hologram.

The baskets that have been used to collect money from this cultural habit are no longer working, and the eggs that have been placed in these baskets are cracking. The trick now is to find new baskets that work.

Derek Abma is editor of The Wire Report. He can be reached at dabma@thewirereport.ca.

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Job opening

Editor, The Wire Report
The Hill Times
Location: Ottawa, Ontario
Posted: December 12, 2015
Salary:

The successful candidate will report, edit and direct coverage of the telecommunications (phone, wireless, cable and Internet) and media (broadcasting, radio, etc.) sectors for our subscription website, which is tailored toward readers involved in these sectors. Among the hot topics we cover are competition in the wireless sector, how the TV Industry is adjusting to things like Netflix and coming CRTC regulations giving customers more choice over the channels they get, and cutting-edge technology such as the Internet of Things and wearables.

The Editor of The Wire Report will lead a staff of two other journalists, assign stories and write them first-hand. This will include an assortment of breaking news and features, long and short.

The Wire Report is based in downtown Ottawa, a short walk from Parliament Hill. We are a division of Hill Times Publishing, which also operates The Hill Times, Embassy, The Lobby Monitor and Parliament Now.

Qualifications

The ideal candidate will have a university degree or college diploma in journalism, and experience in providing news coverage of business, government, courts and/or regulatory bodies, and have spent some time editing and managing other journalists. The successful candidate would, over time, be expected build up a network of sources in business, government and among relevant organizations who can provide tips and insight to help us stay a step ahead of the competition in coverage of telecom and media matters.

Please send your resume and clippings – plus cover letter stating you found this job on Jeff Gaulin`s Journalism Job Board – to:

Asha Hingorani at ahingorani@parliamentnow.ca

Or by mail:

The Hill Times
69 Sparks
Ottawa , ON
K1P 5A5

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TV issues could land on new MPs’ desks

You wouldn’t have known it from the election campaign, but issues related to telecommunications and media stand to figure prominently in the decision-making of parliamentarians in the coming term.

In the area of television, the CRTC has already decided that, starting next year, customers of cable, satellite and IPTV services will have the right to pick each channel one-by-one beyond a very basic package costing no more $25 a month. This is in contrast to past convention where packages were forced upon consumers containing dozens of channels they would never watch.

Many stations will not survive this change because not enough people will choose to subscribe to them, and this will create some job losses and business failures in the domestic -TV industry.

Another TV-related issue is the migration of consumers toward Internet-based video sources like Netflix and away from conventional TV-subscriptions.

The government doesn’t have to worry about big TV-service providers like Rogers, Shaw and Bell, even though they will lobby and/or litigate for any break they can get. These companies will take care of themselves, largely by exploiting the increasingly important Internet side of their businesses.

What politicians have to consider, however, is the extent to which government regulation should support the creation of Canadian TV programming and films. Currently, major TV-service providers have to contribute five per cent of their gross revenues toward the development of Canadian video content. In recent years, this regulation has generated almost $500 million annually.

However, this requirement only applies to the traditional TV industry, not the Internet operations of the same service providers or the companies that provide content over the Internet, like Netflix.

Early in the election campaign, the hated concept of a Netflix tax was discussed, with none of the three main parties wanting to be in any way aligned with such an idea.

But if current trends hold, Internet-based TV services — which do not have to contribute to Canadian content or adhere to Canadian content quotes — will become a bigger business, and subscription-TV services will become smaller, meaning less support for Canadian productions.

In the near future, House members might have to decide whether they need to tweak contribution rules to apply to newer sources of home-viewing entertainment — in other words, consider a Netflix tax — or whether to let those in the TV-content industry succeed or fail on their own merits.

Similar reasoning can be applied to deciding what to do with the CBC in the coming years. Decision-makers are going to have to determine, at some point, whether the public interest is served by prioritizing the CBC in government spending decisions.

Another issue that’s going to come up is the Internet of Things. Such innovation stands to create more personal convenience and business productivity. It also creates many more links between people’s personal space and the outside world, and facilitates the collection of exponentially more data about people’s personal habits that can be used by private enterprises and government.

The NDP made brief mention of this technology and its impact on privacy in its election platform, and the Office of the Privacy Commissioner is slated to release a report on the matter in the near term.

The Internet of Things and how it relates to privacy still falls short of being a typical kitchen-table issue. However, as this technology becomes more common, all it will take are a few highly publicized instances of baby monitors being hacked or household temperature-control systems being tampered with before MPs start getting phone calls.

There are other issues, of course. Both wired and wireless access to the Internet will become even more essential in people’s lives, and government will have to decide how far it should go in ensuring that private-sector access providers are dealing with the public in a fair manner. And there’s also the matter of people in rural areas and the North not getting the same level of connectivity to the Internet at reasonable prices as those in more populated areas.

Even more telecom and media issues are bound to confront this next session of Parliament, many of them seemingly coming out of nowhere. MPs would be well advised to appreciate the newness of it and govern carefully.

Derek Abma is editor of The Wire Report. He can be reached at dabma@thewirereport.ca.

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Story of IoT remains unwritten

A group of individuals, most with some kind of connection the technology industry, got together this week in an old industrial building near downtown Ottawa to talk about the Internet of Things (IoT).

The conference, called IoT613, was held in a setting not typical for events catering to white-collar, tech-industry types. The floors and walls were concrete, telling of a past somehow related to warehousing or construction with little to do with computers, software or mobile technology.

It was in a place called the City Centre building, yet this is a spot that has lost its economic prominence in recent decades. It’s a less-than-inviting environment, particularly for a pedestrian with a lack of sidewalks to and around the building. The conference itself was entered from an unobvious area at the back of the building, so organizers were outside to guide people to where they needed to go.

Yet, this is in a district city planners see big things for. With a downtown light-rail system being built as we speak, in three years this spot will serve as the intersection of Ottawa’s two LRTs, with the current north-south route already there. Millions of square feet of office and condominium space is expected to be built here in the coming years, largely as a result of the advantages its status as a premiere transit hub will bring.

Parallels might be drawn between this small part of Ottawa and the promising but uncertain future that awaits IoT.

Some speakers at the event, such as Emeka Nwafor, a senior director with Intel subsidiary Wind River, told attendees that IoT has been with us for many years, but it’s just recently that people gave it a name.

Nonetheless, he said various things are coming together, such as declining costs for things like bandwidth, processing technology and sensors, that make this the ideal time to get involved in this market space.

“Some people think it’s hype,” Nwafor said of IoT. “It’s not. It’s reality.”

He provided an easy-to-understand definition for what IoT is, being a collection of devices that have their own IP addresses that can communicate with other machines that also have IP addresses. It’s being used for a variety of functions  (subs only) right now, including the tracking of vehicles, collection of data in restaurants and retail operations, and helping people automate utilities at home.

Yet a panel discussion at this event about the future of IoT illustrated how predicting exactly how this form of technology will play out in the years ahead is a fool’s game.

“I think that anybody that says the future is predictable is full of shit,” said Rob Woodbridge, moderator of the discussion and a host of video segments on Untether.tv, a website that explores issues of mobile technology.

For example, he noted how people could not have predicted 10 or 20 years ago that smartphones would become the primary screen most people interact with today.

He asked panel members if they foresee a “tipping point” for when IoT becomes a common thing in people’s lives or when the masses finally “get it.”

Edward Ocampo-Gooding, a developer at Shopify, replied: “I don’t know how important it is to distinguish whether we’re at that tipping point yet. I think that it’s just going to slowly creep into our lives and just become a ubiquitous thing, and we’re probably not going to even notice it.”

There was some discussion of whether dominant operating systems or protocols would emerge for IoT to simplify things for developers and consumers alike, much like iOS and Android have done for mobile devices.

It was acknowledged that many of the products and services out there are attempts to capitalize on the novelty of IoT rather than offer true value.

For example, Ocampo-Gooding recalled a Kickstarter campaign he came across where someone was trying to sell reusable laundry detergent that came with a WiFi chip, resulting in the user being electronically notified when the laundry cycle was over plus other analytics about the wash.

In an exchange later in the panel discussion, Ocampo-Gooding was put off when an audience member asked if such gimmicky products were hurting the overall credibility of IoT.

“People are going to make weird stuff. Sometimes people are going to consider it an art form. That’s OK,” he replied.

He later elaborated: “I think it’s really easy to be cynical about new things. I think it’s really easy to point at the kid in your class that’s wearing his hat in a funny way and we’re like, ‘Look at that weirdo.’

“I totally understand where you’re coming from. … Look at all this gimmicky shit that we’re making. … But I think if we’re going to embrace this, the way to do it is to recognize nobody’s ever going to buy a thing because it has the IoT in it. They’re going to buy it because it’s going to help them do something interesting or make them laugh or something along those lines.”

The key to succeeding in IoT, he said, is simply to “go and build something awesome.”

Getting back to the setting where this conference was held, for someone who just happened to be in the vicinity Thursday or Friday, they would have seen several signs around them saying “IoT.” However, they might have been confused about what it was all about or where to go if they wanted to participate.

Derek Abma is editor of The Wire Report. He can be reached at dabma@thewirereport.ca.

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Election’s coming, let’s talk telecom

There’s going to be a federal election this fall. It’s anyone’s contest to win with three different parties running neck-and-neck in the polls, but nobody wants to talk about what we want to talk about.

Sure, it’s a loss to us at The Wire Report. We’re over here covering these nerdy telecom and media issues, which is fine. But we’d like to join the cool kids in the Parliamentary Press Gallery for a while by providing some election-related coverage. Yes, we would still be addressing nerdy telecom and media issues, but with a little political intrigue thrown in.

Putting aside our own interests, it’s seems that with such a tight contest, parties would want any little advantage they can get. So, if someone from the news media asks you about your plans to deal with telecom and media issues if elected, why not bite? What if that proved to be the thing that got you that extra two or three per cent needed to get over the top?

Yet, we keep hitting a wall whenever we try to find out what the Conservatives, NDP and Liberals have in mind for issues ranging from wireless service, Internet, television, the CBC and other matters.

We’ve been outright ignored by the NDP. The Liberals got back to us with one of those “we’ll look into this” emails, but it went no further. Prime Minister Stephen Harper’s people sent us to the office of Industry Minister James Moore, who is not even running in the next election. For some reason, Moore’s office hasn’t been so quick to get back to us on this.

This comes after a term that saw telecommunications and media being not-so-insignificant parts of the political dialogue at times. Remember the feud (subs only) in 2013 between the government and incumbent wireless carriers, who feared Ottawa was courting Verizon to ride into Canada and shake up the mobile industry?

Then there was that time when the CRTC was trying to conduct a hearing on the TV industry, and the government kept telling them not to even think about trying to tax or regulate foreign video-streaming behemoths like Netflix.

The CRTC this year announced that TV-service providers would have to offer skinny basic packages at no more than $25 a month and the option to customers of picking channels beyond that on a one-by-one basis by the end of next year. Then again, the government had already said this was going to be the deal in its throne speech in 2013.

There has been a fair amount of politicking in these areas in recent years. If I’m trying to get Harper re-elected, I might want to take some time in this pre-election period to trumpet some of the government’s accomplishments and spell out where it goes from here.

If I’m in opposition, I would likely want to point out some flaws in the way things were done and outline how my team would do it differently.

It’s not like the opposition has never thought about these issues before. NDP Leader Tom Mulcair called out the government last fall for statements made during the CRTC hearings on TV, which were deemed by some to be an interference in process. Then earlier this year, Mulcair was promising to reverse cuts at the CBC.

When Marc Garneau was running for the Liberal leadership in 2012, he talked about opening up the telecom market to foreign ownership. He didn’t win the leadership, of course, departing early from this race that was eventually won by Justin Trudeau. We haven’t heard much about this from these guys since.

Perhaps the political types have decided not to concern themselves with a niche publication like ours that’s read by a select group of people with a material interest in these topics, rather than the general public.

But they should consider that many ordinary people have strong feelings on issues like the quality and price of wireless, Internet and TV services, digital privacy and the CBC. Our readers include telecom- and media-industry executives, regulators, lawyers, academics and activists. You might call them thought-leaders, and making an impression on them with your election platforms can have a trickle-down effect on those whose votes you are looking to win in October.

So if Harper, Mulcair, Trudeau and their staffs come around to seeing the importance of sharing their thoughts on telecom and media issues at some point before voting day, we’ll be here with ears wide open.

Derek Abma is editor of The Wire Report. He can be reached at dabma@thewirereport.ca.

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