Thank you very much.
I believe my presentation materials were part of the problem this morning. I apologize for that. They were just a set of speaker notes.
Thank you, Mr. Chair, and thank you, committee. I am the CEO of MoboVivo. We are an Alberta-based company that enables producers and broadcasters to market and distribute TV shows on mobile phones, laptops, and Internet-connected TVs.
What we do is we allow them to monetize, syndicate, and distribute through multiple sales channels and devices. This background on the company is a brief section of my presentation. I wanted to focus more on what the committee is considering.
Really, this includes social media, or the Web, as the two of those converge, and Internet television, something that we haven't seen a lot of yet but will surely see soon. If you walk into a Best Buy, you'll see one on display. There are mobile apps, of course, and computers.
What our company does is allow people to do what we call “screenshift” to all of those devices, whether they're computers, mobile phones, mobile media players, television media devices, or Internet-connected TVs. This is a particular challenge. There's technology behind it, a nice algorithm that we developed, a patent that we filed, and some things that investors like. So we've focused on that, and we've presented the result of that in various ways that lead to this monetization, syndication, marketing, and distribution of content.
Of course, one of those areas is around mobile apps. It's a very interesting space these days; I can't get enough of them on my new iPad. This is what you start to see with mobile apps: you start to see a very potential future, one that may come very quickly.
That was a little bit about the company. Just for context, we do have offices in Toronto and Halifax as well.
The next section of the presentation is a little bit more dense. I'll go through it quickly. I hope you have both the French and English versions. It's not something that I present to investors; I avoid that kind of density with them. Hopefully you'll be able to parse through this.
The thing that is going on here is that there are lots of devices. Consumers are changing, they're showing a willingness to pay for content, and ad-supported models are weakening every year. The recession that we just went through has really accelerated that point perhaps.
There are a number of data points. Apple is selling a lot of TV shows--I'm sure it's both Canadian and American content--to Canadians and of course worldwide.
Surveys are showing that more and more people are willing to pay to avoid ads. We see that when we go into a video rental store. We see a ton of TV shows on those shelves. It's 49%, up from 30% a few years ago. There are a lot of reasons for this. A lot of people are watching them on more than one device.
I'll skip a couple of data points; you have them in your notes.
I will focus on one data point--unfortunately, it's U.S.--that 73% of Americans watch shows on more than one device. One of the fastest-growing activities on the Internet.... This was a 2008 data point from the Pew Internet usage survey, again a U.S. number. It may even be faster in Canada, I don't know, as we don't have the same kind of coverage on this issue.
At any rate, more than social networks, more than any other thing in 2008, the fastest-growing thing was downloading television--not streaming television, not apps, not social networks, but downloading television. In 2008 there weren't really many apps going on. Downloading television is a very significant activity.
So why is that? I think one of the reasons is that the current broadcast delivery system is being attacked by over-the-top delivery models, meaning not your cable systems coming over the Internet. These are driven by apps. One of the things that is quite possible is that the app that carries a channel with TV shows.... The app that carries CBC or CTV or NFB will replace a TV channel. You won't have to flip the channel very soon. If you go into Best Buy today, and if you have an Internet connection behind your TV, you don't have to flip channels. You just have to launch apps.
Now, not all of those apps exist, and there's not a lot of content there, but this is something very easy to respond to. This is something that within a few years--maybe even 18 months--could be a very popular activity and a way of consuming content.
The timing is, of course, the ultimate question. It's the one my investors ask constantly, and potential investors. Unfortunately, I don't know the answer for them either. It's very unfortunate I don't know the answer for them. I think my job would be a lot easier.
As we look at bundled content, our current cable subscriber model, there is resentment and changing attitudes towards that. We have more of the same shows on multiple channels, things you've probably heard before. We have other pressures like free over-the-air HD. And free over-the-air HD will be higher quality than cable. In fact it's already higher quality. It's delivered at something like a 1080p resolution. Our leading cable providers deliver this same content, with a cost, at 720p. “You just bought a brand new TV and you want it decked out? If you want high quality, you get more for free.” It's that kind of thing.
There's lots of fragmentation going on there, and bundling of content. Again, I think some resentment is about to build as we make our switch to HD.
The ad-dollar drain to the U.S. was mentioned.
I've been listening to some of the proceedings. Something that wasn't mentioned yet, that I'm aware of, is unused rights. The rights to content are not being exploited fully to monetize them fully. This of course affects our company. It affects Canadian consumers, but what it really does is it drives illegal consumption. If you can't get it from a legal source and you want to consume it on your phone or your computer, there's a ready-made illegal source of that content, and it's pretty easy to use and it leaves money on the table.
The lack of clarity around copyright drives that. If the Canadian consumer doesn't know that this activity should be frowned upon.... I don't want to make them feel like criminals, but I would like to make them appreciate the content enough to pay for it.
How do we stifle innovation? It's been mentioned already. If we fall any further behind on broadband speed or penetration or affordability, there are great risks, I believe, to companies like ours and others. They will surely head south, where those situations are easier, and of course the consumer impact will be obvious as well. I made the point about HD content not being supported, and the high wireless costs.
Maybe I'll finish off on this point. It really isn't being possible, for two primary reasons, for a YouTube to emerge in Canada under the current situation. There is not enough venture capital. There is not enough inexpensive broadband.
No matter what we wanted to do, what I wanted to do as an entrepreneur, or what anybody else wanted to do, we couldn't have created YouTube with the venture capital situation and the broadband situation in the country.
I'll leave it there. You have the notes on other things. I hope that's all right.
Thank you.