Bell also expects millions of homes to have access to 8-gigabit internet by year-end
By Ahmad Hathout
MONTREAL – Bell CEO Mirko Bibic said today that he looks forward to communicating with new CRTC chair Vicky Eatrides about competition and investments in the industry, as he turned away suggestions that broadband prices are increasing.
Bibic was responding to an analyst question on its fourth quarter 2022 results conference call this morning about comments made by the regulator related to higher broadband prices and the need to reconfigure the wholesale access market to drive competition. Outgoing CRTC chair Ian Scott and Eatrides both expressed that the wholesale access regime – in which third-parties rent space on incumbent networks – is not working to the extent the CRTC expects.
“We are looking forward to sharing our thoughts with the new CRTC leadership on how competitive our industry is,” Bibic said. “In particular, we’re really looking forward to highlighting and reiterating the importance of the massive investments that need to be made in communications networks to drive the country forward.
“Prices are declining – it’s actually undeniable. And communications networks are central to everything we want to accomplish as a country in terms of economic growth and productivity.”
Scott told Cartt in an interview that “broadband rates are creeping up, not down, and that’s a problem.”
Bibic added the country wants fast, reliable, innovative and affordable telecommunications services, but “there’s one common element that underpins all of those and that is investment, and we can’t lose sight of that.”
Those investments proved valuable for the company in the quarter, which said it expects four million homes in its footprint to have access to internet download and upload speeds of 8 gigabits per second by the end of the year.
The projection comes after a year that saw a record sprawl of the company’s fibre route to 854,000 new locations, driving its highest number of new internet subscribers in 16 years at 201,762.
Bibic noted that the company’s strategy is to “reset the benchmark” for what is acceptable internet service, where he said the company’s expenditure plan of driving fibre as far as possible gives it an advantage over cable. He backed this by saying that an increasing number of subscribers are taking up gigabit connections.
“We’re resetting the benchmark for what consumers believe broadband should be,” Bibic said. “That’s a key thing. It’s a competitive differentiator that’s going to last for a few years in my view. Seventy percent of our internet activations [in the quarter] on fibre were on speeds at a gig or above, and 38% of our fibre base is on speeds of a gig and above.”
The wireline segment saw revenue increase by 0.5% to $3.1 billion. New internet subscribers were up 33.3% in the quarter to 63,466 for a total subscriber base of 4,258,570. IPTV subscribers were up 37.7% to 40,209 for a total base of 1,988,181. The company lost 26,000 satellite customers — more than the equivalent period last year — for base of 763,317.
On wireless, the company saw a revenue bump of 7.7% in the quarter to $2.6 billion compared to the same period last year. It increased its postpaid subscribers by 25.1% over the equivalent quarter to 467,294 for a total base of roughly nine million. The company also increased by 13.4% its prepaid additions over the same comparative period for a total base of roughly 880,000. Churn, which is the rate at which subscribers leave, was higher on the postpaid and prepaid side over the comparative period at 1.22% and 5.74% respectively.
Meanwhile, Bell Media revenues were up 4.7% to $889 million compared to the same period last year.
The company’s total revenues were up 3.7% to $6.44 billion in the quarter, attributed to wireless, residential internet and media growth and business wireline data equipment sales. Net earnings were down 13.8% compared to the equivalent quarter last year to $567 million, which was mainly due to declines in advertising demand on the media division’s French-language television properties and increased interest.
Earnings before interest, taxes, depreciation and amortization was up 0.3% in the quarter to $2.4 billion, factoring in the 4.1% increase in the wireless division but offset by declines of 0.6% in wireline and 15.7% in media. Negative factors included inflation contributing to higher fuel and labour costs and increased competition to acquire mobile phone subscribers.
The company also says it is keeping its financial guidance steady despite an expected recession that the company’s chief financial officer Glen LeBlanc said could be “short and shallow…but I could be wrong.”
