OTTAWA-GATINEAU – Competition continues to grow for Canadian companies in the telecommunications industry, the CRTC says in its 2007 telecom monitoring report.
Total revenues for the industry as a whole grew in 2006 by 4.5% to $36.1 billion, while EBITDA rose 5.3% to $13.1 billion.
But the big story is the continuing bite that competitors are taking out of the traditional telcos’ business. Competitors grabbed an additional 3% market share, rising to 38% of total revenues in 2006, the report says. Competitors’ revenues rose 12% from the year before to $13.7 billion, mainly because of cablecos recording an impressive 17% growth.
The number of competitor phone lines, essentially from cablecos, grew by a whopping 89% residentially and by 13% for business lines.
Cell phone and high-speed Internet penetration also grew: more than two-thirds (66.8%) of Canadian households now have cellular service, while 6 out of 10 (60%) now have broadband, up from 51% in 2005. Canada still has the top high-speed penetration rate among G8 nations, the report says.
“As we rely more and more on market forces, and only regulate where necessary, the CRTC Telecommunications Monitoring Report is one of the important tools that allows us to assess whether the Canadian Telecommunications Policy objectives are being met,” said CRTC Chair Konrad von Finckenstein in a release. “This year’s report tells us that competitors are making inroads in local telephone markets. In fact, competition has increased to the extent that it has accelerated the deregulation of certain markets, which will benefit consumers.”
Other highlights from the telecom report:
• The number of mobile phone subscribers rose 10% in 2006 while the number of residential subscribers to high-speed Internet services increased by 16%.
• Internet and cellular telephone services accounted for 50% of all telecom revenues in 2006, a jump from 45% over the previous year.
• The cellular telephone market remained the largest and fastest growing sector in the telecom industry as revenues grew by 15%, from $11.0 billion in 2005 to $12.7 billion in 2006. Cellular telephone revenues accounted for 35% of the total telecom revenues, up from 23% in 2005.
• Canada had a landline and cellular telephone penetration rate of 98.6% in 2006.
• Capital expenditures rose from $5.6 billion in 2005 to $6.9 billion in 2006, an increase of 24%.
• In the residential market, competitors held a 14.2% share of local and access lines in 2006, up from 7.6% in 2005. In the business market, their share of local and access lines grew from 14.3% in 2005 to 15.9% in 2006.
• Internet revenues went from $4.5 billion in 2005 to $5 billion in 2006, an increase of 9.4%. Broadband’s availability increased from 92% of Canadian households in 2005 to 93% in 2006.
The full 2007 telecom report is here.
