Netflix isn't the only company planning to launch a new streaming-video service in Canada in 2010. Zip.ca, whose Canadian DVD mail-rental service is very similar to Netflix's U.S. DVD rental service, plans to launch its own streaming-video service in calendar 2010, in time for the holiday season.

In July, Netflix said it planned to bring its streaming-video service to Canada this year. That means the Netflix apps present on many flat panels and Blu-ray players will now have a purpose in Canada. With Zip.ca's announcement it appears Canadian consumers will a choice of streaming-video serves this year.

Zip.ca has been working on the service for well over a year. In June 2009, Zip.ca signed an agreement with Sonic Solutions that would allow the Canadian company to offer a streaming-video service powered by Roxio CinemaNow that would deliver movies and TV shows to PCs. "We've been working since then to conclude hardware and studio deals," Zip.ca CEO Scott Richards told Marketnews in an exclusive interview. "We've announced that this fall is when we'll be streaming."

Richards said important details need to be finalized before the launch. These include deals with studios for content, and deals with hardware manufacturers to embed Zip.ca client software on products such as flat-panel TVs, Blu-ray players and set-top boxes. Richards said it will be possible for manufacturers to add Zip.ca support to existing products via firmware updates.

Richards would not confirm the cost or nature of the service, but did hint that it might involve a hybrid with his company's disc-rental business. Zip.ca has been operating for seven years, and now has an 85,000-title catalog. "We're going to add streaming capability to our catalog," Richards stated. "Some movies will come by mail, because they're not in our streaming catalog. This is the only way for consumers to get both selection and convenience. The only thing they should be worried about is what they want to watch." Online streaming will allow Zip.ca to compete with bricks-and-mortar video stores on new releases, while offering a much richer back catalog, he elaborated

For streaming, movie studios favour sale as opposed to rental: a business model they call video on-demand electronic sell-through. That means that consumers would be purchasing streamed content. Content could either be stored on a hard drive in the subscriber's device itself, or online in the "cloud."

"We believe in the concept of a digital locker," Richards said. "We don't think consumers should have to bit on which hardware will be available in a few years." While Zip.ca's streaming service will be strictly a Canadian offering, consumers will be able to access Zip.ca's cloud services anywhere they can get an Internet connection.

Any broadband connection will be fast enough for video streaming, Richards said. Bit caps are a bigger issue than download speed, Richards says. Users will hit the caps on typical entry-level high-speed services after six to 10 movies, he explained.

Article Tags:  zip.ca, netflix, video streaming, roxio, CinemaNow, Sonic Solutions, Scott Richards