(Montreal) The president and chief executive officer of BCE expects that the coverage of the Canadian fiber optic of the company will cap, after the federal government announced that it would not intervene in a controversial regulatory decision concerning the access of wholesale to the Internet services.
Mirko Bibic said on Thursday that Bell had already deployed its fiber optic internet network at around 8 million households, but that the company does not plan to increase this number at the moment. This is a significant reduction compared to its previous objective of reaching 9 million households, a figure which was then revised to 8.3 million before being still lowered.
These decisions follow the framework implemented by the Canadian Radio and Telecommunications Council (CRTC) allowing other Internet suppliers to sell fiber optic services to their customers, using networks built by holding companies such as Bell, for fees.
Bell was particularly irritated by a provision that allows the largest Internet suppliers in Canada – Bell, Telus and Rogers Communications – to resell Internet services on existing fiber networks built by others, provided they do it outside their main regions of service.
Arguing that this discourages large suppliers from investing in their own infrastructure, Bell has reduced its investment plans this year by 500 million.
The Minister of Industry, Mélanie Joly, said on Wednesday that Ottawa would not overthrow the CRTC policy following a federal examination.
“We are disappointed with the government’s decision to maintain CRTC’s decision,” said Bibic during an interview. At this stage, we simply urge the government and the CRTC to ensure that network manufacturers are fully compensated for significant construction costs and the risk of considerable investment that we take during construction. »»
Under the CRTC rules, any new optical fiber infrastructure built by large telecommunications companies cannot be made available to competitors before five years. The regulatory body said that its framework established an effective balance between competition and investment needs.
In his decision, Mme Joly said that CRTC policy “immediately made it possible to increase competition on existing networks”.
Telus began to offer an internet fiber optic service in Ontario and Quebec last November as part of the wholesale regime and announced its intention to extend its offer to the Atlantic provinces.
Bell argued that such access to its network should not be offered to its greatest competitors.
“Imagine spending billions of dollars to generate a return, then that a regulatory body tells you that you have to give up this asset to someone else so that he can draw a return,” said Bibic. When you present things like that, people start to look at you and say: “Really? It makes no sense.” »»
If Telus welcomed the decision of Mme Joly, other companies have sounded the alarm. Rogers spokesperson Sarah Schmidt described this decision as a “dismaying voltage compared to her position in principle adopted less than a year ago”, referring to an OTTAWA prescription asking the CRTC to re-examine whether the three large suppliers should be authorized to act as wholesalers.
At the time, Ottawa had expressed concerns about the viability of small Internet access providers as a spare solutions in the regulatory framework.
Growth potential in the United States
While the deployment of the Bell fiber optic network in Canada has stalled, the company sees growth potential south of the border after having concluded an agreement of 5 billion last week for the acquisition of the Internet service provider by American fiber Zipy Fiber.
This acquisition extends the coverage of the Bell optical fiber network in the United States of 1.4 million service points.
“The American optical fiber market is very attractive, and that is why we are delighted to have concluded the agreement last Friday,” said Bibic to analysts at a call conference on Thursday, while BCE, a parent company of Bell, published its second quarter results.
“The deployment of fiber optics in the United States is behind that of Canada, we know. Only about 50 % of American households are equipped with optical fiber, which means that the opportunity is considerable when we start to deploy the fiber, “he added.
BCE has also revised its forecasts up to reflect the agreement. It now provides for growth in turnover from 0 to 2 % in 2025, compared to old forecasts which tapped on a loss of 3 % to an increase of 1 %.
An increased profit
Bell Canada’s parent company said its net profit attributable to ordinary shareholders was 579 million, or $ 0.63 per share, in the second quarter.
This result is compared to a profit of 537 million, or $ 0.59 per share, a year earlier.
Operating income for the closed quarter on June 30 totaled 6.08 billion, compared to around 6 billion a year earlier.
On an adjusted basis, ECB indicates that it has made a profit of $ 0.63 per share, down compared to an adjusted profit of $ 0.78 per share in the same quarter last year.
Analysts expected an adjusted benefit of $ 0.71 per share on average, according to estimates compiled by LSEG Data & Analytics.
BCE recorded a net gain of 44,547 subscribers to postpayed mobile telephony in the second quarter, compared to 78,500 net activations during the same period a year earlier. The company has once again invoked a “less active market”, a slowdown in demographic growth due to federal immigration policies and its own concentration on “loading of higher added value” to explain this drop.
The company indicated that the unsubscription rate was 1.06 %, down 0.12 % compared to the previous year. This is the first quarter of improvement over twelve months since 2022.
Average BCE user income for mobile telephony was $ 57.61, down 0.7 % compared to $ 58.04 a year ago. The company explained that this decrease was attributable to the pressures exerted by competition and discounts, the drop in income related to the excess use of data, customers increasingly subscribing to unlimited or high capacity data packages, and the decrease in roaming income due to the decrease in trips to the United States.
