Profits up for Canada's phone, cable firms

Mobile market entrants listed on Globe and Mail list

TORONTO -- Canada's wireless phone war is doing wonders for the bottom line at local phone and cable giants.

The Globe and Mail newspaper, in its latest ranking of Canada's top 1,000 publicly-listed companies by profit, on Friday revealed new mobile market entrants nipping at the heels of incumbent players is raising everyone's game.

BlackBerry maker Research in Motion is the fourth-most-profitable Canadian company, having made $2.45 billion in profits in fiscal 2010, but close behind is phone and satellite TV behemoth BCE Inc. in 10th place with $1.73 billion in profits.

Rogers Communications, another Big 3 cable and mobile phone player, grabbed 15th place with $1.47 billion in earnings in its last fiscal year, followed by western Canadian phone and satellite TV giant Telus in 28th place with $998,000 in earnings.

And Shaw Communications and Quebecor, two traditional cable players latest moving into the mobile phone market, occupy the 40th and 63rd places in the profit-ranking table, respectively.

Canuck broadcasters, by contrast, have mostly posted mounting losses during the current economic downturn, hammered by a TV ad slump and increased competition from niche channels and the Internet.

You have to go to 184th place to find a domestic broadcaster in profit last year, with TVA Group, Quebec's largest sector player, posting $49 million in earnings.

Despite their continuing profitability, Canadian cable and phone giants remain vulnerable to new digital platforms and possible disintermediation.

The result has a host of "TV Everywhere" services launching nationwide, the latest coming from Shaw Communications with its new online video portral, Shaw Video on Demand, and Quebec cable giant Groupe Videotron launching its own on-demand Illico Web service (HR, June 16).

Cable giant Rogers Communications got the Canadian video portal market rolling when it launched Rogers on Demand Online as a beta site in late 2009, followed by a similar "TV Everywhere" offering from Bell TV, and Quebec-based Radio-Canada introducing Tout.TV as an online extension of the French language public broadcast service.

With the emergence of online TV video sites like Hulu, Canadian cable operators especially are providing their subscribers with online access to VOD libraries to dissuade customers from scaling back on cable packages or cutting the cord completely.
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