Shomi came into this world with a whole lot of bravado from Rogers Communications Inc. (TSX:RCI.B)(NYSE:RCI) and Shaw Communications Inc (TSX:SJR.B)(NYSE:SJR), but it’s leaving with its tail between its legs, sporting losses of upwards of $200 million.

Ouch.

Anyone who’s been around television broadcasting and studied the progress of Netflix, Inc. (NASDAQ:NFLX), the U.S.-based video streaming service, should have come to the conclusion back in August 2014 when Shomi hit TVs that it simply wouldn’t fly.

Netflix came to Canada in 2010. By July 2014 it had three million subscribers in the Great White North; today, that number is well over five million. Shomi and Crave (BCE’s streaming service) combined are said to have less than 700,000 subscribers, or about 13% of Netflix’s customer base.

Regardless of how that 700,000 breaks out between the two services, there’s absolutely no possibility that Crave is suddenly going to grab all of Rogers’s Shomi subscribers. At the end of 2015, BCE raised the monthly subscriber fee (for Bell TV subscribers) to $6 from $4–a 50% increase. Otherwise, it’s $7.99 per month. Netflix charges anywhere from $7.99 to $11.99, depending on the level of service chosen.

Crave’s big draw is its HBO and Showtime content, which includes shows like Game of Thrones, Ballers, Veep, Homeland, Ray Donovan, and many others. But in terms of total content, it’s absolutely crushed by Netflix. Michael Geist, one of Canada’s leading legal minds when it comes to the internet, estimated that in 2015 Crave had 403 titles compared to more than 3,700 at Netflix.

When both Rogers and Bell launched their streaming services in 2014, my first thought was, “This is going to cost them a lot of money to come anywhere close to Netflix.” That didn’t happen. Now, it’s up to BCE to decide if it wants to continue the fight–one that’s not going to get any less expensive because Rogers has left the playing field.

So, what’s the verdict? Is it good news or bad news for BCE? I think it’s terrible news.

With Rogers still in the game, BCE could argue that a competitive marketplace existed for video streaming in Canada that was worthy of further investment. Now that Rogers has thrown in the towel, institutional investors are going to be asking some serious questions about Crave’s long-term viability and whether or not further investment is sensible.

Consider Netflix.

It has US$13.2 billion in content obligations–90% of the payments are due within three years. That’s a big nut to carry around, even for Netflix. BCE paid Corus Entertainment Inc. $211 million at the end of last year for the right to roll out The Movie Network and HBO Canada across the country. Is BCE really committed to going down this road, or has it simply been using Crave as a way to boost its premium content?

Now that it’s had the rights to The Movie Network and HBO Canada across the country for almost a year and Shomi has dropped out of the competition, I’m not so sure it has the staying power to keep Crave going.

More importantly, for shareholders, I’m not sure it should. Netflix is starting to show some cracks in its armour, which are reflected in its declining stock price. It’s no longer investors’ shiny new toy. If Netflix can have problems, Crave has no hope of success.

In the immortal words of Sun Tzu… and Bud Fox (Wall Street), “If your enemy is superior, evade him. If angry, irritate him. If equally matched, fight, and if not, split and reevaluate.”

I think it’s time for BCE to reevaluate.

Stock buy alert hits astounding 96% success rate!

The hand-picked investing team inside Stock Advisor Canada recently issued a buy alert for one special type of "bread-and-butter" stock where The Motley Fool U.S. has banked profits on 23 out of 24 recommendations. Frankly, with an astounding 96% success rate that has delivered average returns of 260%, chances are this new pick could deliver life-changing returns as well. Because the team at Stock Advisor Canada fully embraces the same time-tested investing philosophies that have led to countless Motley Fool winners globally. So simply click here to unlock the full details behind this new recommendation and join Stock Advisor Canada.

*96% accuracy includes restaurant stock recommendations from Motley Fool U.S. services Stock Advisor, Rule Breakers, Hidden Gems, Income Investor and Inside Value since each services inception. Returns as of 5/27/16.

NEW! This Stock Could Be Like Buying Amazon In 1997

For only the 5th time in over 14 years, Motley Fool co-founder David Gardner just issued a Buy Recommendation on this recent Canadian IPO.

Stock Advisor Canada’s Chief Investment Adviser, Iain Butler, also recommended this company back in March – and it’s already up a whopping 57%!

Enter your email address below to claim your copy of this brand new report, “Breakthrough IPO Receives Rare Endorsement.”

Fool contributor Will Ashworth has no position in any stocks mentioned. David Gardner owns shares of Netflix. Tom Gardner owns shares of Netflix. The Motley Fool owns shares of Netflix.