Results tagged “videotron” from IP Communications and Technology

Statistics Canada is reporting that Canadian cable operators are continuing to lure away residential phone customers away from Bell Canada and Telus. In a publication released yesterday, Canada's national statistics agency reports that as of August 31, 2006, the cable operators, led by Videotron, Rogers, Shaw and Cogeco, had 927,463 telephone customers. That is four times more clients than they had a year earlier.

Many of the incumbents' customers are lured away by attractive bundling options offered by the cable operators. While the rate of growth has slowed, the cable operators continue to chip away at the incumbents' customer base. As the rate of growth slows, I anticipate that the cable operators will enhance their service offering and begin to offer more aggressive pricing.

In my view, Bell and Telus have limited options:

1. They could just ignore the competitive threat if they believe that the bulk of the damage has already been done. I'm confident that this option is not viewed as a viable option by either of the incumbents.

2. With the regulatory handcuffs removed, they can begin to lower prices. While we are likely to see price reductions by all players, playing the pricing game is not in their best interest.

3. Innovate! In my view, increased innovation is the most significant consumer benefit of increased competition; not reduced prices. By offering enhanced telephony offerings and integrating mobility, Internet and television features, Bell and Telus can stem the flow of customers to their competitors without slashing their telephony profit margins.

Rick McCharles
Telecom Consultant, Toronto
RIC Services
 
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