Canadian Telco Havoc

Companies get a bad surprise with their overage charges; Telus may have taken a toll on Rogers

Andrew Willis 26 August, 2020 | 1:39AM
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Andrew Willis: Phone companies in North-America have been able to stay afloat through COVID-19 with the help of non-phone offerings, from internet service to sports teams. But that wasn’t enough to replace roaming charges – and the loss of such classic fees took a toll.

For example, as of August, BCE’s wireless billings dropped almost 9% year-over-year, as customers stayed at home, and we expect this to continue throughout the rest of this year. Equity analyst Matthew Dolgin sees losses in the product segment at around 95%, and says stay-at-home orders also affected the sales of cellphones, through losses in foot traffic to physical retail locations.

Altogether these losses add up to about 11% in wireless revenue gone for BCE. But Bell’s competitor, Rogers, really suffered with 13% in wireless revenue gone – combined with losses in its media segments to make a loss of 17%. But then came along Telus.

Wireless losses took a Toll on Telus, but in the midst of the chaos they picked up sixty-one thousand new subscribers. In the same period, Rogers lost…sixty-six thousand…prepaid customers. OuchIf this was a switch, it’s certainly worth noting that those customers then picked up postpaid plans with Telus.

As we look ahead, post-pandemic, we still see Canada’s Big 3 Telcos well on top of the wireless market. And those losses they faced? Considering they’re the few we had to choose from for so long: I’d say they signed up for it.

For Morningstar, I’m Andrew Willis.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
BCE Inc45.18 CAD-3.19Rating
Rogers Communications Inc Shs -B- Non-Voting51.93 CAD-0.36Rating
TELUS Corp21.72 CAD-0.14Rating

About Author

Andrew Willis

Andrew Willis  is Senior Editor at Morningstar Canada. He previously produced content for Fidelity Investments and finance industry events for Euromoney Institutional Investor and has written in the past for Thomson Reuters and CNN. Follow him on Twitter @Andrew_M_Willis.

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