WIND Mobile Subscribers Top 702,000, But Parent Company Still Looking to Sell

Vimpelcom has announced its Q1 2014 earnings for its Canadian investment WIND Mobile, which saw an increase of 25,916 net subscribers, bringing its total active subscriber base to 702,125. Average revenue per user (ARPU) increased 12 percent compared to the year ago quarter to hit $31, which the company called its ‘best quarter ever’.

WIND Mobile released the following statement on today’s earnings release:

“It’s been a tremendous start to the year for WIND Mobile and we’re very pleased to report that we’ve experienced our best quarter ever. Not only have we surpassed the 700,000 active customer mark, with a 17 per cent growth in subscribers, but our ARPU has grown 12 per cent to $31.00. We have no doubt that 2014 will be a great year for WIND. We have started this year strong thanks to industry firsts including being the first Canadian telecommunications company to offer U.S. unlimited roaming and we will continue to provide Canadians with the value, simplicity and true mobile freedom they have come to expect from WIND Mobile, while we continue our growth as Canada’s fourth national carrier.”

The company says it continues to lead “real unlimited” and “no contract” offers in Canada, helped in party by managed subsidies and what it calls value plus positioning. It also highlighted how it’s the first carrier in the country to offer unlimited U.S. roaming for a $15/month add-on.

WIND Mobile now has 310 retail properties nationwide and has continued to improve its network, which has 1,385 sites on air, with various upgrades.

WIND Mobile Still Looking for an Exit According to VimpelCom

Despite the growth in its Q1 2014, Vimplecom, the parent company of WIND Mobile which is owned by Russian billionaire Mikhail Fridman, still is looking for an exit strategy for its Canadian investment, reports the Financial Post, citing a Bloomberg interview with VimpelCom’s chief executive Jo Lunder:

“What’s going on in Canada, I think, is very simple. We decided not to participate in the 700 auction early in the year because there was no clear path to control. At the same time, we have written off $1.5-billion of investments in Canada over the last couple of years,” he said. “And for that reason… we have no intention really to put any more funding into Canada at this point.”

“For that reason, we are now having different discussions with different players in that market to either sell it or to combine it with others and take a smaller position in a larger entity,”

Lunder also said in the interview VimpelCom may sell WIND Mobile or “swap it for stake in larger operator working in the country,” which confused Dvai Ghose, head of research at Canaccord Genuity, who believes the latter was referring to a potential deal with Quebecor rather than the ‘Big 3’, since the Federal Government would most likely not approve a sale to incumbents. Back in March, VimpelCom took a $0 write down on its Canadian investment.

Ghose also stated WIND’s ARPU of $31 pales in comparison to the $59 average from Rogers, Telus and Bell, which may be attributed to the smaller carrier’s lack of the iPhone and its discount pricing.

Founder and Editor-in-Chief of iPhoneinCanada.ca. Follow me on Twitter, and @iPhoneinCanada, and on Google+.

  • Cyrus

    Why can’t T-mobile come into the Canadian market? That would be amazing!!

  • Fireeast

    I think if quebecor could scoop up the new entrants we could have a serious forth player. I still wonder why the new entrants dont merge. By doing this they can cut costs, share assets and leverage there larger pool of customers.

  • thewinnipegger

    Because of the laws in place make it hard to compete. This is why Vimpelcom wants to sell WIND because even tho the feds allowed them to be in canada they still have a huge restriction of foreign owned companies in the mobile space, I think it’s 10% still.

  • thewinnipegger

    Even tho it’s a great idea i wonder if the debt load of both companies may cripple the combined one. I wonder if WIND ever thought of it.

  • Chrome262

    It doesn’t have the available cash, it could buy Wind, as it has a deal with them for the unlimited US roaming, and probably has a decent relationship with them., I think. But that would be money they don’t have. They are spending billions on improving their infrastructure and coverage. Besides, the way Canada’s market is now, Its hard to get foreign investors interested, as you see in the above comment, even Wind’s owners want out of here. Doesn’t T-Mobile offer a similar deal with unlimited Roaming in Canada?

  • kkritsilas

    I think that the long term end result of all of this will be a buyout or merger of Wind and Videotron/Quebecor. Vimpelcom may want to sell out or merge with somebody, but Industry Canada (IC) will not allow them to merge with any of the Big 3, or more accurately, not allow Wind’s spectrum to be taken over by the Big 3. Same story is playing out with the current Mobilicity bankruptcy. The bankruptcy court may rule in favour of allowing the merger of Mobilicity and Telus, but I’m pretty sure that they cannot force IC to allow Telus to take over Mobilicity’s spectrum (no jurisdiction). Even if they did, when spectrum license renewals come up, IC will just not allow Telus to renew Mobilicity’s spectrum license.

    The only thing that IC will allow is for all of the 1700 spectrum (possibly with the exception of what Shaw has) to be owned by a new entrant. Unless Shaw does a huge about face, which is close to being out of the question as it gets, the only scenario possible is to have a merger of Wind and Videotron/Quebecor. The combination will have somewhere around 1.5M (or more) subscribers, and will make for a viable 4th player, as both Videotron and Wind (very slightly) are profitable. Videotron can retain its brand inside of Quebec, and Wind can be the brand outside of Quebec, trading on its reputation as a good low cost provider. I can see Wind/Videotron having good, usable plans in the $50-55/month range, and all you can eat plans for $75/month. range. Roaming would be easy, as the phones from both companies use the same frequencies, and the networks don’t have much overlap. Mobilicity may or may not be part of this.

    Kostas

  • jay

    i think wind should buying mobileicity and use there network with the wind network they have already and all the customers wind has with mobileicity has could be a huge chance of a fourth player its a huge chance for them but i think its well pay off huge for them do that and buy them out

  • Ari

    I would like to see Shaw make a bid for Wind. Imagine the possibilities. When you combine Wind’s reasonable prices and the free wifi being offered for shaw cable subscribers, you have a credible option versus the big three in large centres like downtown Vancouver which is saturated with Shaw GoWifi hotspots. Now imagine if they offered that wifi to people who don’t have shaw cable but did have Wind service? Imagine if they could get more spectrum to offer better service.

    BTW. I loved using the unlimited data in the US on T-Mobile and AT&T even if it was only 3G speeds. I can only imagine what the 200MB would have cost on the big three.