In house video, caps and overage fees for using it...
Canadian cable operator Rogers has constructed what's essentially the dream business model for broadband executives. They're launching a new broadband video portal
that's only available if you sign up for Rogers wireless, TV or broadband service -- avoiding a stand-alone service in order to keep users from canceling regular cable. Rogers has also imposed low caps and high overages and the new service counts against your monthly cap -- meaning Rogers is keeping content revenue in house while socking customers with per-gigabyte overages -- up to $5.00 per gigabyte
-- for actually using an advertised service.
Of course the only way this model works is if customers agree to pay overages, but with limited Canadian competition many users have no choice. The idea also falters if the video service isn't actually any good, and early impressions of the freshly opened beta from users in our forums are hit and miss
Luckily for your bandwidth cap there's no HD option at the moment, and the available content is extremely limited -- as in a few dozen films and mostly older TV shows (CHIPs, anyone?). According to the new Rogers On Demand FAQ, only one person per broadband account can access the new service.
On the other hand it's free to existing customers of any
Rogers service, unlike Comcast's looming "TV Everywhere" effort, which will only be made available to the company's existing TV customers. Obviously the beta is evolving, and according to Rogers additional functionality (like parental controls and access via smartphone) are things that are coming in 2010.
Still, it's hard to get around this idea that users already paying more than enough money for both cable TV and
broadband access face additional, steep per-gigabyte usage fees for using a Rogers service designed to keep them as customers. Any Rogers users care to share their thoughts on the new service in the comment section below?