TORONTO - Two of Canada's top telecommunications companies have teamed up to launch a subscription video-on-demand service they say can rival the current industry titan Netflix without cannibalizing their own cable and television-on-demand services.
Called "Shomi," the new service kicks off in November and will initially be available to Rogers and Shaw Internet or TV customers, the companies announced Tuesday at a Toronto news conference.
The service will complement each telecom's existing television programming by giving users access to past seasons of current shows as well as movies and exclusive content, with some original offerings on the horizon, Rogers Media president Keith Pelley said.
Shomi has past-season streaming rights to a host of popular TV shows including "Modern Family," "Sons of Anarchy," "Sleepy Hollow," "Shameless" and "2 Broke Girls."
Users will be able to access 240 TV series and 1,200 movies on tablets, mobile, online and through Xbox 360 as well as set top boxes, the companies said.
The new service comes amid research that shows households are increasingly abandoning traditional TV in favour of online services. In Canada, up to 665,000 households â€” or 5.7 per cent â€” are expected to rely only on Netflix or other online services by the end of the year, according to a study by the Toronto-based Convergence Consulting Group.
While Netflix has operated unchallenged in Canada for years, Pelley said he's not worried about arriving late on the scene, saying their research has shown consumers "can support two, three, even four SVODs (subscription video-on-demand)."
The companies hope to lure viewers by adding curation by experts â€” a human touch akin to what was once found in video stores â€” rather than relying solely on algorithms to suggest movies and shows.
"There's another SVOD out there. (...) I think the user interface that we have is better, I think the content that we have is very compelling to Canadians and I think the curation that we did with our collections is stronger," he told The Canadian Press in an interview.
Both Rogers and Shaw have been striving to engage audiences on other platforms while operating in a constantly evolving industry, said Barbara Williams, senior vice-president of content for Shaw Media.
In the end, content is what drives most consumer decisions, she said.
Pelley said that fight for content will ensure there's room for more than one video-on-demand service in the Canadian market.
"I think it's impossible for one service to have all the content," he said.
Shomi will have 30 per cent Canadian content, and both companies said they are open to working with other distribution partners. "Quite a few titles" will come from the CBC, they said.
The suggested retail price is $8.99 per month, with packaging and bundling options to be announced.
Neither would discuss how much they invested in the venture or in licensing agreements.
The service will remain in beta mode for six months to a year while they fine-tune the platform and update their catalogue, they said.
"We wanted to get it out now, we felt like it was a strong enough product to get out, with great content that will really resonate," Pelley said.
"But at the same time, it will evolve."