The Battle for the Canadian Couch Potato

by Gaurav Kheterpal on April 14, 2010

The Convergence Consulting Group has recently released an interesting report on the future of TV, Internet, Telephone and Wireless services in Canada. Labeled as ‘The Battle for the Canadian Couch Potato’, the report suggests that new entrants including the likes of Wind Mobile, Shaw, Public Mobile, Mobilicity, Videotron and EastLink will account for nearly a quarter of Canadian subscriber base by the end of 2014.

Further, the report outlines some staggering facts related to the Canadian wireless industry. For example, despite wireless data’s 36% revenue growth in 2009, total wireless service ARPU declined. The report predicts that the entry of new players will have a strong impact on data and voice pricing which will lower the ARPU further.

IMO, the finding of this report are not surprising at all. The new players are making their presence felt in Canadian telecom space and increasingly putting more pressure on the ‘Big Three’ amidst growing competition. The prices for voice plans have been on a decline since 2008 and the trend is likely to continue till 2014. Here are some other interesting predictions of this report.

* Wireless-only Canadian homes will increase from 8% in 2009 to 19% in 2012

* Telcos will lose up to 52% revenue in residential wireless telephony in 2011 as compared to 28% in 2009

* Cable represented 28% of residential wireless telephone subs in 2009 and it is expected to reach 32% in 2010

* Cable television will drop from 71% share in 2009 to 67% in 2010. Satellite TV will also decline from 25% to 22.5%

The report indicates that convergence, triple play and quad play will be the norm for future communication in Canada. Along with this report for Canada, The Convergence Consulting Group has released a similar report for United States and the predictions for both reports are quiet similar.

As for the wireless market in Canada, I believe that the entry of new players is a blessing in disguise for consumers. It not only helps keep the pricing in check but also introduces innovations such as new billing plans that charge consumers based on when, what kind and how much data they use. It’s an interesting tussle as the Big Three are slowly moving away from unlimited data plans to deal with increased congestion and avoid traffic management. However, newcomers to Canada’s wireless market continue offer unlimited packages to capture market share.

What changes will the Canadian wireless market undergo in the next 4 years? Who will win the coveted Canadian Couch Potato battle – Incumbents or Challengers? I’ll be glad to hear your opinion.

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Written by: Gaurav Kheterpal. www.digitcom.ca. Follow TheTelecomBlog.com by:RSS,Twitter,Identi.ca, or Friendfeed

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