Some Internet tier upgrades due to bandwidth, not speed: Cope

Some subscribers are climbing Internet service tiers not necessarily for increased speed, but to obtain unlimited bandwidth, George Cope, BCE Inc.’s president and chief executive officer, said Thursday on a second-quarter earnings conference call with analysts. Cope made the comments while fielding a question on what speeds Bell’s new subscribers are taking. Cope said Bell still sees “huge demand at 50 still in our base,” and suggested competitors’ offers of unlimited Internet at higher tiers might be reason for the increasing popularity of higher-speed offerings. “So that would drive customers toward that particular tier, not necessarily driven by the speed,” he said. The comments come exactly two weeks after Guy Laurence, Rogers Communications Inc.’s president and chief executive officer, said that his company needs to focus on the “need for speed” and get consumers to a baseline of 100 Mbps before they begin scaling to its gigabit service. Desmond Lau, a telecom analyst at Veritas Investment Research Corporation in Toronto, said Internet bandwidth usage has increased by 46 per cent over the last five years, so "it's true binge users may care about bandwidth more than speed." CRTC data seems to show that speeds have been climbing higher than bandwidth. Lau said that “the weighted average advertised download speed increased from 12.6MB to 15.5MB to 21.2MB from 2012, 2013 and 2014, respectively,” while weighted average bandwidth limits “increased from 103GB to 118GB over the same time period.” Capping how much Internet consumers can use in a month before overcharges has been a subject of recent debate in the industry, with advocacy groups calling for the CRTC to focus its upcoming hearing on differential pricing practices on data caps instead. Cope made the comments while also unveiling two new Bell products to be released this month: a fully wireless IPTV service, which Bell is calling a world-first, and the Home Hub 3000 Modem, which will provide capability beyond 1 Gbps. He added that Bell projects the average number of devices per modem will increase from three to 12. Bell reported revenues of $5.34 billion and net earnings of $830 million, for the three-month-period ended June 30, an increase of 0.3 per cent and two per cent, respectively, over the same period last year. “There’s no doubt, where we have IPTV and where we have fibre is where we have the best market share growth for us,” Cope said. Cope said 2.6 million premises currently have access to its fibre-to-the-premises (FTTP) service, with a goal of increasing that to three million by the end of the year. Bell finished the quarter with a total of 8.3 million wireless subscribers, up 1.9 per cent, 3.4 million high-speed Internet subscribers, up 3.1 per cent, and 2.8 million television subscribers, up 2.8 per cent, all compared to the same quarter last year. For the quarter, the wireless division gained 2.2 per cent over the second quarter of last year, posting revenues of $1.735 billion while wireline revenues took a hit of 2.1 per cent, falling to $3 billion. Wireless blended average revenue per user (ARPU) increased 2.9 per cent to $64.32, bolstered by more two-year contracts, higher post-paid smartphone subscriber mix and increased data usage, according to Bell’s news release. Meanwhile, Bell Media posted revenues of $779 million, a 5.3 per cent gain over the comparable period last year, on the strength of increased subscriber revenues from The Movie Network, Crave TV and TV Everywhere Go products, the company said. — With reporting by Ahmad Hathout at ahathout@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Some Internet tier upgrades due to bandwidth, not speed: Cope

News | August 4, 2016

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Some Internet tier upgrades due to bandwidth, not speed: Cope

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