Rogers dives into 4K video, gigabit Internet

Rogers Communications Inc. on Monday announced it is moving forward with two different kinds of technology — 4K video and gigabit-speed Internet — though one commentator says the success of either of these initiatives is uncertain. Rogers CEO Guy Laurence said during a live-streamed press conference from Rogers Centre in Toronto — home of the Blue Jays baseball team — that 40 per cent of television sets sold in Canada this holiday season will be 4K. "This is going to be a 4K Christmas," Laurence said. A problem up until now, he said, was finding the 4K content and networking infrastructure capable of serving the 4K sets. Laurence said Rogers will make 4K set top boxes available for sale before the end of the year, the price of which will be announced at a later date. As well, it will start producing 4K sports content, including about 20 National Hockey League games starting early in the new year and all home Blue Jays games for the 2016 season — or more than 100 sporting events in total. Rogers' involvement in 4K, Rogers said in a press release, also includes a new deal to secure 4K content from Netflix Inc., which involves a direct link to Netflix' servers and a Netflix app being included on "select cable set-top boxes and Android devices from Rogers." As well, Rogers said Shomi, the streaming service it owns with Shaw Communications Inc., will have more than 100 hours 4K programming available next year. All this amounts to "the largest commitment to 4K broadcasting in the world," Laurence said. He added that a technology called high-dynamic range (HDR) — which he said "pops the colours so dramatically on the screen that you actually feel like you're ... right next to the athlete as you're watching the action" — will also be incorporated into the 4K video quality Rogers is offering. Laurence said owning the Blue Jays and its stadium, operating the Sportsnet specialty channel and being a TV- and Internet-service provider puts it in a better position than most to offer 4K content to consumers. "We own the team, we have the stadium, we have the production team, we have Sportsnet, we control the boxes, we control the infrastructure of what goes into people's homes," he said. "So we can control the end-to-end experience for the consumer in a way that most companies in the whole of North America and beyond cannot. ... If you get a disconnect between what the broadcaster wants and what the cable company's willing to provide, that's when you get that disconnect. That doesn't happen here because we're all on the same management team." Besides owning the Blue Jays and, though its stake in Maple Leaf Sports & Entertainment (MLSE) Ltd., a portion of the Toronto Maple Leafs hockey team, Rogers is also heading into the second season of a 12-year rights deal with the NHL that is costing it $5.2 billion. Laurence said the company would comply with regulations in making its 4K content available to other TV-service providers capable of transmitting it. Quebecor Inc.'s Videotron announced in August that it is releasing a 4K set-top box. Rogers said gigabit Internet service will become available in Toronto and some surrounding areas this year, and will expand to all of Rogers’ cable footprint of more than four million homes in Ontario and Atlantic Canada by the end of 2016. It said in its release that such a service is "perfect for streaming 4K." Rogers said gigabit Internet service with no data caps will be sold for $149.99 a month. A Rogers official said in an email before the official announcement that Internet data usage has grown 700 per cent since 2009, and is expected to grow another 400 per cent in the next four years. Laurence on Monday said half of that traffic is from streaming video, and that proportion is growing. "The reality is that consumers are activating more devices to their WiFi at home, and those devices themselves are all consuming more and more Internet," Laurence said. "However, if you want to use these devices concurrently — if you've got Dad watching the sport, you've got the kids watching films at the same time in another room — then you need bandwidth and you need higher speeds, and that's what we're going to provide." Gregory Taylor, an assistant professor of mass communications at the University of Calgary, said there is a clear relationship between Rogers' newly announced gigabit Internet and its 4K video. "If you're streaming things in 4K, you need to have speeds and capacities that are really high," he said in a phone interview. However, Taylor said demand for both 4K and gigabit Internet is by no means a "slam dunk" for Rogers. "I've looked at 4K and it's nice, but you've got to remember just two years ago the big push was for 3D TVs, and that flopped," he said. Taylor said the "wow factor" of moving from standard definition to high definition was likely greater than it is for moving from regular HD to 4K. He added that most of the HD TV sets that people bought in recent years are still in working condition, making him wonder what the current demand is for 4K sets and related programming. With regard to gigabit Internet, Taylor said: "We've had areas of the world where gigabit speeds are available and people don't want them. But, on the other hand, you could argue you're future proofing if you do this." Cogeco Cable Inc. CEO Louis Audet recently told an investors' conference that there is "no demand" for gigabit Internet right now, so Cogeco is not yet putting resources into creating this kind of service. Other major service providers, including BCE Inc. and Quebecor, have recently announced plans to offer gigabit Internet speeds. Telus Corp. said Friday that it will invest $1 billion in Vancouver over the next five years to make its fibre network in the city "gigabit-enabled." A Rogers official said that because of "technology choices" it has made, it can upgrade to gigabit Internet at a "fraction of the cost" of telephone incumbents. Scotia Capital telecom analyst Jeff Fan pointed to that advantage in a research note in August, in which he said that cable companies can build out the next generation of broadband infrastructure, called DOCSIS (data-over-cable interface specifications) 3.1, for about one-tenth the cost per customer of what telcos have to pay for fibre-to-the-home. Quebecor has said it is currently using DOCSIS 3.0 to test gigabit service in Montreal, and will upgrade to DOCSIS 3.1 next year, which is capable of faster speeds. Neither Rogers nor Quebecor have disclosed how much they are spending to upgrade their Internet to gigabit speeds. Bell said it will spend $1.1 billion to upgrade its network in Toronto, a similar amount to what Telus said it will invest in Vancouver. — With reporting by Derek Abma at dabma@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca and Shruti Shekar at sshekar@thewirereport.ca

Rogers dives into 4K video, gigabit Internet

News | October 2, 2015

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