UPDATE 2-Pricing changes dent Rogers wireless revenue; profit up

Thu Oct 24, 2013 10:16am EDT
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By Alastair Sharp

TORONTO Oct 24 (Reuters) - Rogers Communications Inc said on Thursday third-quarter revenue slipped at its wireless unit, the company's biggest business, due to pricing revisions, even as its profit squeaked past expectations.

Canada's largest wireless company, which has some 9.5 million mobile customers, said revenue was crimped by new, lower-priced roaming plans, while phone sales also dropped and fewer people signed up for service.

Rogers, also one of the country's biggest cable television and Internet providers, added 64,000 net postpaid wireless subscribers, significantly fewer than expected and down from 76,000 a year earlier.

This is a closely watched measure because postpaid customers sign multi-year contracts and typically pay much more each month than prepaid subscribers.

At that pace, Rogers could cede more of its leading market share to rivals Telus Corp and BCE Inc's Bell, which share a national wireless network. Both are due to report quarterly earnings next month.

"Rogers Wireless is still underperforming and we expect much better from Bell Mobility and Telus Mobility," Canaccord Genuity analyst Dvai Ghose wrote in a note to clients.

Rogers' chief executive, Nadir Mohamed, who is due to leave his post soon, said the slower wireless growth was likely linked to the timing of premium device launches and moves by Canada's telecom regulator to enforce maximum two-year contracts. This has forced operators to adjust pricing from their typical three-year contracts.   Continued...