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Canadian Cable and Telecom Providers Battle for TV and Phone Customers

7:10 am on April 16, 2007 | Category: Business, Telecom Services, Telephone, Television

Canada’s leading cable operators will gain a large share of the residential telephone market over the next few years, but will in turn begin losing pay-TV subscribers to telecom rivals, according to a recent report from Convergence Consulting Group Ltd.

There’s little doubt that the cable sector will play a big role in the future of telecommunications, as incumbent TV providers like Rogers, Shaw, and Videotron offer â€œdigital phoneâ€ services throughout the country with a growing degree of success.

Convergence estimates that Canadian cable companies will have 2.3 million voice customers by the end of this year, compared to 1.6 million in December 2006. This number will likely reach 3.4 million, or 27% of the local telephone market, by late 2009, the consultancy predicts.

“The cable machine continues rolling along,” commented Convergence president Brahm Eiley, noting that cable presence in the business telephone sector is likely to more than triple over the next three years, reaching 120,000 enterprise customers by the end of 2009.

“Just like in the residential market, there are some disgruntled small-business users,” Eiley explained. He predicted, however, that “telcos will remain dominant in this area” for the foreseeable future.

Beginning in 2008, Convergence predicts that cable operators will have some serious competition on their hands in the video sector, as telecom carriers like MTS, Sasktel, and Telus aggressively expand their digital television services. Bell Canada is also expected to enter this market in the not-so-distant future.

Convergence predicts that incumbent telecom providers will have around 750,000 television subscribers at the end of 2009, representing an overall market share of 6%.

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