BCE outshines Rogers with wireless, Internet-TV strength

By Susan Taylor

TORONTO (Reuters) - Canada's big telecom companies want as many high-paying customers as they can get, but some are clearly doing a better job at it than others.

Montreal-based BCE (Toronto:BCE.TO - News), which operates under the Bell brand, made big gains against wireless market leader Rogers Communications (RCIb.TO) in the last three months of 2014, while also winning more landline customers with its Internet television offering, Fibe.

Bell, Canada's largest telecommunications company, added 117,378 postpaid wireless customers, who typically spend more than those who pre-pay for service, it said on Thursday.

Rogers lost 58,000 such customers, it said late last month. The third of Canada's dominant wireless operators, Telus Corp, is due to report next Thursday.

Bell also extended its lead over Rogers in landline Internet connections, adding 34,000 while Rogers shed 4,000.

Bell added 76,000 customers to Fibe, whose signal travels over the same optic cables that deliver Bell's online connectivity. Fibe is helping Bell retain customers who bundle products, Desjardins analyst Maher Yaghi said.

Both Bell and Rogers say they are focused on selling more services to their highest-paying customers while shying away from discounts that may win over more price-conscious users.

An average Bell wireless customer, blending post-paid and pre-paid, was billed C$61.12 a month in the fourth quarter, a 5.5 percent increase from a year ago.

"The results clearly show that Bell is continuing to take wireless subscriber, revenue and cash flow share from Rogers," Canaccord Genuity analyst Dvai Ghose wrote in a note.

The fight for wireless subscribers could heat up as more customers shop for deals during the so-called "double cohort" zone in which three-year deals signed prior to the introduction of a wireless code that bans them expire at the same time as newer two-year contracts come up for renewal.

Bell posted a nearly 10 percent increase in fourth-quarter profit and upped its dividend more than 5 percent, while company forecasts for 1-3 percent revenue growth with adjusted earnings of C$3.28-C$3.38 in 2015 did not surprise.

Net income rose to C$542 million from C$495 million a year earlier. On a per-share basis, net earnings were flat at 64 Canadian cents.

On an adjusted basis, earnings rose to 72 cents from 70 cents. Operating revenue rose 2.7 percent to C$5.53 billion.

Analysts, on average, had expected adjusted earnings of 71 Canadian cents a share on revenue of C$5.46 billion, according to Thomson Reuters I/B/E/S.

($1=$1.24 Canadian)

(Additional reporting by Alastair Sharp in Toronto and Ashutosh Pandey in Bengaluru; Editing by Maju Samuel, Chizu Nomiyama, Peter Galloway and Meredith Mazzilli)