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    Rogers Wireless gains subscribers in fourth quarter
    Up 14 per cent over last year
Colour-screen handsets popular


    Toronto Star  

Strong sales of mobile phones in the last three months of 2003, boosted by the popularity of colour-screen handsets, helped Rogers Wireless Communications Inc. ring in a happy new year.

The Toronto-based mobile phone provider said yesterday it gained 172,600 new subscribers during the fourth quarter of last year, up 14 per cent from the previous year.

Of those gains, 166,200 subscriptions were for higher-valued post-paid accounts, a jump of 31 per cent compared with last year's post-paid figures.

" Our focus has been for the last several quarters on the post-paid customers, and you can certainly see that," said John Gossling, chief financial officer for the company.

Net additions for the year were 381,400, bringing the company's total subscriber count to 3.79 million. Customer churn — which measures the loss of customers to a company — fell to 1.99, breaking below the "2" barrier for the first time in the digital cellular era. Lower churn is an indication of stronger customer loyalty.

Gossling said colour phones and family calling plans were popular in the quarter, which included the busy holiday shopping season. About two-thirds of phone and device sales related to colour-screen products.

While rivals Bell Mobility and Telus Mobility heavily marketed digital-camera phones during the holidays, Rogers focused its attention on selling more phone plans to families and emphasizing colour screens, even though it has several camera phones in its product lineup.

" I think the impact of camera phones was relatively small," Gossling said. "It's a premium handset, not a mass (market) item."

Brian Sharwood, a telecom analyst with SeaBoard Group in Toronto, said Rogers likely spent less money than its main rivals did acquiring customers in the quarter because it didn't have to subsidize the sale of expensive camera phones.

Sharwood called the quarter's subscription results "solid" numbers. " If the bottom line falls nicely for them, it could be a very strong quarter for Rogers."

More interesting, he added, will be subscriber numbers from Montreal-based Microcell Telecommunications Inc., provider of the Fido service.

The company launched its CityFido plan in Vancouver last quarter in a bid to lure local phone business away from Burnaby, B.C.-based Telus Corp.

Sharwood said the expectation is that Microcell is doing well with the service and could report significant growth in the most recent quarter. But a predatory campaign launched by Telus Mobility, Bell and Rogers during the period could counter any gains.

Offering guidance for 2004, Rogers Wireless said it expects an operating profit of between $810 million and $835 million and between 350,000 and 400,000 new subscribers for the year. Capital expenditures will remain flat at between $400 million and $425 million.

Rogers Communications Inc., parent of the wireless unit, also reported it gained 35,400 high-speed cable users in the fourth quarter, down 22 per cent from the previous year. Gains for the year were down nearly 6 per cent compared with 2002, but total subscriptions grew 23.6 per cent to 790,500.

The company added 8.5 per cent fewer basic cable customers in the quarter but saw the sale of digital TV service grow by 36 per cent over the same period in the previous year with a gain of 50,800 subscribers.

The cable business expects revenue of between $1.91 billion and $1.95 billion in 2004, and an operating profit before management fees in the area of $710 million and $730 million.

It also estimates it will gain 120,000 to 150,000 new high-speed Internet customers and 100,000 to 120,000 new digital cable subscribers in the new year.



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Thursday, 04 June 2020

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