Competition between Canada’s telecoms has intensified in the wake of Rogers Communications Inc.’s RCI-B-T takeover of Shaw Communications Inc., SJR-B-T but some industry analysts predict that the trend could be short-lived.
Rogers launched a suite of new cellphone plans in early May, with discounts available for customers who also purchase internet or television service from the company. Rogers wireless president Phil Hartling said the move aims to capitalize on Rogers’ much larger market for bundled services after its $20-billion acquisition of Shaw’s cable network in Western Canada.
However, the recent pricing moves by Rogers “might not be indicative of sustained aggression,” Mr. Valentini said. Rather, the company might be looking to appease regulators in the aftermath of its hotly contested takeover, or to signal to Quebecor that it needs to “tread carefully and balance profitability,” he wrote.
“The same thing happened with Shaw initially and then over time it petered out,” Mr. Heger said, noting that Shaw was a larger company than Quebecor. For the past several months, Bell has been selling its 1.5-gigabit internet service for $60 a month – significantly less than the $122 it charges on a wholesale basis, Quebecor chief executive officer Pierre Karl Péladeau said during the company’s most recent quarterly earnings call.
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