A Barclays analyst was surprised to see that Shaw-owned Freedom Mobile (formerly known as Wind Mobile) hasn’t been aggressive with promotions to lure in new subscribers during the past quarter, compared to the Big 3. In a note to investors, analyst Phillip Huang said he expected Shaw would make the most of its lower prices to grow its wireless market share (via Financial Post).
“We are somewhat surprised that Freedom has not turned more aggressive in driving subscriber growth given its inherent advantage with pricing and market share,” analyst Phillip Huang wrote in a Monday note setting the stage for Shaw’s quarterly results next week.
Shaw’s Freedom Mobile currently controls only a small fraction of the wireless market, which Huang puts in the low-to-mid single digits. By comparison, the Big 3 control about 90% of the market. They all launched promos that targeted Freedom’s customers through their brands Fido, Chatr, Public Mobile and Virgin.
Just ahead of Shaw’s quarterly earnings report, Huang estimates that Shaw has attracted 24,000 new subscribers, lower than the 27,000 for the same period a year ago. Analyst consensus is a bit higher, at 28,000.
Shaw’s best promotions were launched in March, which will not be reflected until next quarter’s report, he highlights, as Shaw’s quarters end a month before the incumbents’.
While retaining its $29 price target, Huang believes Shaw cannot effectively compete “head-on against the Big 3 the way Videotron can”. Quebecor-owned Videotron moved into double-digit market share in the fourth quarter, he notes.
