Bell Canada is on the verge of a major effort to get inside Canadian family rooms with the introduction of new Internet-based TV services.The "Bell Entertainment Service" will finally allow the giant telephone company to compete head-to-head with cable TV providers Rogers Communications Inc. and Vidéotron Ltée by offering television signals over the same fibre-optic lines it uses to provide its new Fibe Internet services.

Cable providers account for more then 60 per cent of all of Canada's monthly TV subscribers. The technology used by cable broadcasters has allowed them to offer new services, such as video-on-demand, in recent years that satellite has not been capable of offering.

Bell's new entertainment service will compete with its existing satellite-based link, Bell Satellite, formerly

ExpressVu. More than two million Canadians subscribe to the satellite service.

No one from Bell was available to comment Thursday on the new service.

But Kevin Crull, Bell's president of residential services, told a Toronto newspaper on Wednesday that that company's new TV services will be groundbreaking.

"It's really absolutely the next generation of television," he said.

"It's as big a leap as when we went from black and white TV to colour."

While Bell hasn't been marketing the service openly, the Internet is buzzing with details, including a 23-page manual for customers telling them how to set up the Bell Entertainment Service and the benefits it will provide.

The new TV services will bring high-definition (HD) programming and more than 100 channels, to as many as four TVs in a home. It will also offer customers a "whole-home" personal video recorder (PVR), which will allow viewers to watch programming on all TVs in a house from one DVR, as well as services that have been traditionally offered by cable TV companies, including on-demand programs, online access to schedule the recording of shows and the ability to pause and rewind live television.

Satellite service is a one-way link, and offers none of the new service's interactive features. In addition, satellite receivers require there be no obstructions like high-rise buildings to interrupt the link with satellites.

Like digital cable or satellite, consumers of the new service will need to purchase a set-top box for each TV.

Bell has announced plans to spend $3 billon on network upgrades this year in order to bring its Fibe services, and by extension the Bell Entertainment Service, to millions of Canadian homes. Already the service is available to around three million households, a majority of which are in Toronto and Montreal.

A total of 50,000 customers in those cities subscribe to the entertainment service. In order to receive it, customers must also subscribe to Bell's Fibe 6 Internet service. Prices for the two services bundled together range from around $67 per month, before taxes and other fees, to more than $140 per month depending on the package.

Bell is not yet ready to roll out the product to a large audience, said Tony Olvet, vice-president of communications, segments, mobility and client hardware research domains at IDC Canada.

However, he suggested Bell should accelerate introducing the TV services as competing technologies are being introduced at breakneck speeds.

Apple TV 2, Google TV and Netflix in Canada, which will allow Canadians to watch TV and movies at home over the Internet, will force many people to question whether they even need a monthly cable, satellite or Internet TV subscription.

"That's disruptive to the TV markets and should be something that TV carriers in Canada should be keeping an eye on," said Olvet. "There is a bigger looming issue of eyeballs moving more to web-based services. People, especially younger people, are not subscribing to traditional pay services."

Vince Vittore, a principal analyst with research firm the Yankee Group, said the new Bell service is similar to what AT&T and Verizon now offer in the U.S.

He said the service will pose a direct threat to the dominance of Canadian cable TV companies and could even offer better, and cheaper, services if Bell decides to bundle home phone and other technologies.

"It does represent a threat relatively soon, depending on how fast Bell wants to roll that service out," said Vittore.

He also said that satellite TV service will survive after the Bell Entertainment Service launch. The satellite TV service will continue to provide television to rural residents where cable and high-speed Internet services are difficult to find.
Satellite Internet Servicesource: www.vancouversun.com