Rogers' profits tumble amid new mobile phone competition
Canadian cable and telecom giant reports profits for the three months to Sept. 30 down 24%
TORONTO -- With new mobile phone market entrants intensifying competition, Canadian cable and telecom giant Rogers Communications on Tuesday stumbled as it reported sharply lower third quarter earnings.
Toronto-based Rogers saw profits for the three months to Sept. 30 tumble 24% to $370 million, against earnings of $485 million in 2009.
Total revenue was up 3% to $3.2 billion, with the wireless phone business raising its revenue 4% to $1.82 billion on increased smart phone activations and upgrades.
But the cost of fending off upstart mobile phone competition, including equipment subsidies, reduced Rogers' wireless service margins to 48.3%, off from 51.4% in 2009.
On the cable side, Rogers increased its revenue by 3% to $797 million as it grew its cable TV, Internet access and voice-over-cable phone businesses.
And the media group's radio, TV and publishing division saw its revenue also grow by 3% to $376 million on higher audiences and ad sales for its U.S. primetime series airing on its Citytv over-the-air TV stations, and increased subscriber fees for cable channels.
Rogers also raised its TV subscriber base by 17,000 to just over 2.3 million customers.
To keep its TV subscribers on side, Rogers also recently launched an online video portal, Rogers On Demand Online, and acquired a minority stake in Michael Eisner's web video studio Vuguru in return for controlling Canadian rights to its web-based content.