BCE launching Internet-based TV in summer

Phone company angling for cable customers

TORONTO -- Canadian phone giant BCE promises a knock-down fight with rival cable operators to become the biggest TV provider nationwide.

And the weapon of choice for BCE chief George Cope is Internet-based TV (IPTV), to be launched initially in Toronto and Montreal this summer.

"Our goal is that by 2015, we'll be the largest provider of TV in Canada," Cope told a Canadian Club audience in Toronto.

BCE, which already operates the nationwide Bell TV direct-to-home satellite TV service with 1.9 million subscribers, built an Internet-based network for TV, data and voice in and around Vancouver for its coverage of the recent 2010 Olympic Games.

Now Cope wants to expand that IPTV offering nationwide, not least because condominium towers in major cities often disallow the mounting of exterior dish antenna for satellite TV.

BCE is betting Internet-based TV will drive market access into densely-populated urban markets.

"If you lay the market out, in the core of Toronto and Montreal our market share is less in TV than it is in the suburbs," Cope observed.

IPTV would reverse that market imbalance by taking TV customers from cable toppers Rogers Communications and Groupe Videotron in Toronto and Montreal, respectively, he predicted.

"We're basically targeting to capture share of the TV market from the cable operators," Cope said.

The escalating turf war comes as rival phone and cable giants nationwide increasingly bundle phone, TV and Internet-access products to offer one-stop shopping for consumers.

BCE has its eyes on AT&T's "U-verse" IPTV service stateside to see if features like its HD channel lineup and home DVR eventually connects with residential consumers and returns its investment.

HD is now the norm among Canadian TV services, led by BCE's Bell TV service and rival services from cablers Rogers Communications, Shaw Communications and Groupe Videotron.

To drive their bundled phone, TV and Internet-access offerings, Rogers has acquired TV content from its Citytv TV network, Shaw Communications recently paid $2 billion for Canwest Global Communications Corp.'s TV assets and Groupe Videotron runs the TVA network in Quebec.