Rogers CEO: Canada Does Not Need a Fourth Wireless Carrier
Earlier today Rogers released its 2013 second quarter financials to reveal $3.2 billion in total revenue for its wireless, cable and media divisions. Its wireless segment added 98,000 wireless postpaid subscribers (for a total of 9,418,000 overall users) and an adjusted operating profit of $821 million, growth of 3 percent compared to the year ago quarter. Blended average revenue per user (ARPU) increased slightly to $59.30, up 20 cents from a year ago. Sounds like a decent second quarter for the company.
With that being said, Rogers CEO Nadir Mohamed told analysts today (via The Star) he doesn’t believe Canada needs a fourth wireless carrier, which the Federal government is pushing for.
“I’ve never seen how a four-player market can work in a country like Canada,” Mohamed said, noting Canada’s “geographic expanse.”
In particular, Mohamed echoes what TELUS CEO Darren Entwistle said a while ago: Verizon is getting special treatment compared to Canadian incumbents, should the U.S. wireless giant enter our country:
“What we’re absolutely against is a tilted or stacked playing field where you have a massive incumbent U.S. carrier that would be given favourable treatment, and frankly better treatment than Canadian incumbents,” Mohamed said Wednesday.
Mohamed says due to our large geography, four wireless carriers is just not sustainable, let alone having three, which he stated is the norm globally for the number of carriers in one country:
“I’ve never thought of it as a sustainable model. If you think of what has happened in Canada consistently over a period of time, it has been proven out that in this country it’s difficult enough, frankly, to work with three players.”
The CEO also said if Verizon were to enter Canada, urban markets would benefit more compared to rural markets.
Nadir Mohamed is set to retire from the company in January 2014 and will be entitled to a $18.5 million retirement package; he is currently part of the process in finding a replacement for Rogers.
What do you think? Does Canada need a fourth wireless carrier or not? Reading the comments from the recently announced two-year term pricing plans from our incumbents, it appears we do.