Rogers says NHL fans will benefit from wireless spectrum purchase
The Rogers Communications headquarters in Toronto. (Aaron Vincent Elkaim / THE CANADIAN PRESS)
The Canadian Press
Published Thursday, April 3, 2014 4:46PM EDT
MONTREAL - Rogers Communications is betting consumers -- especially NHL hockey fans -- will be watching more video on their tablets and smartphones with its recent $3.3-billion purchase of wireless spectrum.
The Toronto telecom company said Thursday the new spectrum will help it better handle increased traffic on its network, and will complement its 12-year deal with the NHL for the national broadcast rights to all games, including the playoffs and the Stanley Cup final, on all of its platforms in both English and French.
Rogers said the additional spectrum will allow more consumers to be on its network at the same time watching a hockey game on their mobile devices.
"Mobile video consumption tends to be around big events and often times, those are sporting events and there's no bigger sporting in this country than hockey," said David Purdy, senior vice-president of content at Rogers (TSX:RCI.B)
"So it will allow for us to manage what we think is going to be an incredible, explosive growth in terms of the consumption of mobile video."
Last November, Rogers scored a $5.2-billion blockbuster deal with the National Hockey League, a coup against telecom rival Bell and its TSN sports channel.
Bell (TSX:BCE) has long been a leader in offering mobile television to its customers, but now, Rogers can offer all NHL and professional baseball content, as the owner of the Toronto Blue Jays.
Telecom analyst Greg MacDonald of Macquarie Capital Canada said the question is how much consumers will want to pay to stream live sports.
However, Rogers does expect that live sports will add to much monthly revenue per customer, he said.
"But I don't think the market is going to see a conclusion on this within the next year," said MacDonald, the firm's managing director and head of research.
Rogers was able to successfully bid on paired blocks of 700 megahertz spectrum and won 22 licences across the country, except in the Yukon, Northwest Territories and Nunavut. It compared the spectrum -- needed to make cellphone networks operate -- to having more lanes on a highway.
The recent spectrum auction in January raised a record $5.27 billion for the federal government.
However, the auction failed to immediately entice a fourth national player into the Canadian wireless market to provide more competition.
Some of the telecom companies are starting to roll out plans for the spectrum which is considered ideal both for rural areas and dense urban cities.
Telus (TSX:T) spent just over $1.14 billion for 30 licenses, while Bell spent $565.7 million for 31 licenses and says it will start deploying the spectrum in rural and remote areas right away.