Cable TV packs passé in Canada, report finds

U.S-based on-demand video streaming service Netflix, Inc., added 900,000 Canadian subscribers last year amid an accelerating shift away from traditional cable and satellite TV packages, a new report says. The Convergence Consulting Group on Monday said about 95,000 fewer households were paying for TV from cable, satellite and telecom providers at the end of 2014, while Canadians ditched 13,000 linear TV subscriptions in 2013.

The report forecast a further decline of 97,000 in 2015, contrasting the number with annual growth in 2011, when TV subscriber additions averaged 220,000.

As of the end of 2014, the group estimates that 3.09 million Canadian households, or 21.6 per cent, did not have a traditional linear TV subscription, up from 2.85 million in 2013.

At the same time, Toronto-based Convergence estimates that Netflix Canada, which launched in the country in 2010, pushed its subscriber base to 3.9 million at the end of 2014.

Convergence president Bram Eiley said the annual review of online and traditional TV in the U.S. and Canada estimates revenue for Netflix Canada last year at $317 million and spending on Canadian programming of $150 million.

Netflix, which is exempt from regulation and taxation in Canada under a new-media provision, will generate $413 million in revenue in Canada in 2015 and end the year with 4.7 million subscribers, Convergence forecasts.

It estimates Netflix will have six million Netflix Canada subscribers, net of households using international versions, with more than $600 million in revenue by the end of 2017.

The study also found more Canadians are becoming comfortable watching content through other Internet platforms, whether it’s through the web platforms of TV channels or illegal downloads.