Quebecor hits 1M wireless milestone

Seven years after

launched its mobile network to become the fourth wireless player in Quebec, it has surpassed the 1 million subscriber mark.

The Montreal-based communications and media giant, which offers wireless, cable and internet services under the Vidéotron brand, reported Wednesday that it ended 2017 with 1,024,000 wireless subscribers.

It added 34,000 mobile customers in the three months ending Dec. 31, nearly one-quarter (23 per cent) of the gross additions in the areas where it competes, Vidéotron CEO Manon Brouillette said in a call with analysts. Vidéotron’s wireless market share now sits at 16 per cent, she said. Executives have previously stated a goal of capturing a quarter of the regional wireless market.

Brouillette credited the strong performance to dynamic wireless offerings, pointing to promotions including a two-for-one deal on iPhones and a subscription to Quebecor’s online video-streaming service Club Illico for mobile customers on premium plans.

“Everything we do is to make sure we’re ahead of competition. Every quarter if they meet or match our offer, we bring something different, something new in the market and we will keep doing so,” she said.

Competitors play a “submarine strategy” where they offer promotions directly to customers to keep their tactics confidential, she said.

“They’re very aggressive. Since we rank first in share of gross additions, of course they’re trying to be as active as possible,” she said.

Vidéotron’s numbers indicate customers like the unique Club Illico deal. More than 32,000 customers downloaded the Club Illico mobile app since it launched in mid-November, Brouillette said. Vidéotron expects it will increase average revenue per user in the future as customers use more data.

Quebecor’s overall financial results were in-line with expectations, with lowerthan-expected revenue in the media division and soft numbers for cable television in advance of Quebecor’s internet protocol TV launch with Comcast’s X1 product.

But the wireless results impressed analysts, who praised the different promotions on the call.

Wireless subscriber growth continued its momentum as Vidéotron saw an uptick in average revenue per user, RBC analyst Drew McReynolds wrote in a note to clients.

“Quebecor’s continued strength in wireless is in line with the general strength in the Canadian wireless market in the fourth quarter, but we are pleased to see this excellent performance after BCE reported very strong net additions in the same quarter,” Desjardins analyst Maher Yaghi noted.

Analysts have looked to Vidéotron as a blueprint as

tries to expand its wireless business, Freedom Mobile, to take on the Big Three in British Columbia, Alberta and Ontario.

“Current consensus estimates for Shaw’s wireless subscriber growth suggest a clear symmetry with Quebecor’s wireless growth phase,” Yaghi noted earlier this week.

But he believes Shaw will have to spend more if it wants to match Vidéotron’s success. Bay Street estimates imply Shaw’s capital expenditures will be mostly flat from 2017 to 2020, he wrote, where Quebecor’s capital telecom spending “practically doubled in the early phase of its wireless launch.” candy bars, discovered Ebert was buying genuine Mars products in the U.S. through his company Bemco Cash and Carry, and selling them at a discount in this country.

Mars Canada, based in Bolton, Ont., took its complaint to Federal Court, but the two sides settled when Bemco agreed it would not import or sell the U.S.-made products in Canada. As part of the deal, Bemco also identified its supplier as GPAE Trading Corp., also owned and controlled by Ebert, which agreed to a Mars Canada demand to cease its activities.

However, Mars Canada discovered in 2010 that foreign products bearing its trademarks were again being sold in Canada, this time through another company, but in concert with Bemco and GPAE, court documents show. Mars Canada sued.

Ebert argued the earlier agreements were invalid because they amounted to restraint of trade but Superior Court Justice Frederick Myers granted summary judgment in favour of Mars Canada in November 2016.

The Court of Appeal rejected the appeal, saying Mars Canada had an obvious interest in defending its trademark, and did sustain actual damages given that its sales were cannibalized by the grey market products.