Canadian Telcos See Profit Surge

Operating profit in Canada's wireless industry increased by 67.1% compared with the same period a year earlier to just over CA$1 billion (US$909 million) in the fourth quarter of 2006, substantially more than the CA$675 (US$614) million posted by the traditional wireline segment reports the government agency, Statistics Canada. This increase in operating profit was attributable to the wireless industry's increase in revenues (16.2% over the fourth quarter of 2005 to CA$3.4 (US$3.1) billion in 2006), while holding down the increase in costs during the same period to 2.8%.

The agency reports that there were 55.1 mobile subscribers per 100 inhabitants at the end of 2006, almost identical to the 55.3 traditional wireline access lines per 100 inhabitants. This convergence in usage rates has been ongoing since the introduction of cellular service in Canada. For example, at the end of the first quarter of 1999, there were 18.7 wireless subscribers per 100 inhabitants, whereas there were 64.4 traditional wireline access lines per 100 inhabitants.

The number of wireless subscribers increased 8.4% to just over 18 million in the fourth quarter of 2006. The operating revenue per subscriber also increased at the end of 2006, climbing 7.2% to approximately $190 per subscriber compared with $177 in the fourth quarter of 2005. These data suggest that not only has the wireless industry continued to attract more users, but the industry has also managed to increase the usage per subscriber."

Posted to the site on 18th May 2007