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Convergence Predicts 1.64 Million Subs for New Entrants by End of 2014

September 14, 2014 - Written By Cory McNutt

Canada’s Government has a mission to increase wireless mobile competition, hoping to lower prices and increase customer service.  The Government would like to see a fourth large carrier emerge to combat the Big Three – Rogers, Bell and TELUS.  The Government wants this new fourth carrier, but they want someone to come in and buy up the newer, smaller, entrants and expand one of them…as long as your are not one of the Big Three. The Convergence Consulting Group does an annual report called “Impact of New Entrants” – they considered EastLink, Mobilicity, Videotron and Wind Mobile the new entrants.  The report predicts that by the end of 2014, these four carriers will have 5.8-percent – 1.64 million – of all Canadian wireless subscribers.

The numbers are way below what Convergence had originally projected for 2014, in fact, their forecast is 600,000 lower than last year’s report predicted.  Convergence explains that when they make predictions they have to make a few assumptions, one of which was the “outcome of the 700 MHz Auction and the potential merger or sale of Independent New Entrants.”  For instance, Public Mobile – a former ‘new entrant’ – was acquired by Telus, so those former Telus subscribers were no longer included in the totals this year, throwing their projections off. Moving from the new entrants, Convergence has good news for the Big Three – Bell, Rogers and Telus – and predicts that they will enjoy a 13-percent growth in revenue increase from data usage alone.  This increase will help account for 49-percent of their 2014 revenue…this is data growth revenue…not bad.

Another big area investors like to look at is the Average Revenue Per User (ARPU) and Convergence says that it will continue to grow by about the same as it did in 2013 – 1.2-percent.  A few other facts they threw out to our source – the Canadian wireless smartphone penetration with hit 71-percent by the end of 2014, which is a 6-percent increase from 2013.  It is amazing when you think about almost three-quarters of the Canadian population own a smartphone. Please look us up on our Google+ Page and let us know what you think of Canada’s wireless industry – would you like to see another large carrier go up against the Big Three – do you think it would cause prices to become more competitive…as always, we would love to hear from you.