Rogers CEO Defends Price Hike: Cost of Wireless Plan Still Less than a “Cup of Coffee”

by Istvan Fekete on January 28, 2016

rogers-300x168The price hike we reported earlier is coming, but a bit later than originally expected – at least from Rogers. Telus and Bell have already introduced price rises, because of the falling loonie, which they claim has inflated costs (via the Canadian Press).

Rogers collects, on average, $60 per month from its customers, which is similar to the average price Bell and Telus customers pay. A customer whose bill is at around that amount can expect to pay 8.3% more per month, which is equivalent to an extra $60 payment to Rogers annually.

During the earnings call yesterday, Rogers CEO Guy Laurence defended the carrier’s move to increase prices, since the holiday quarter results looked good: The country’s biggest wireless player has reported $3.45 billion in revenue and $331 million in profits, driven by a 4% increase in wireless revenue.

He also said that competition was the most intense in Canadian history as Rogers compete hard against Bell and Telus for customers who signed two-year contracts following a 2013 CRTC decision to limit cancellation fees.

Laurence also pointed to the higher cost of network equipment as the Canadian dollar continues to fall, which has resulted higher expenses. That is the main reason for raising prices by $5. However, he quickly added that the daily cost of a wireless plan is still less than a “cup of coffee.”

“If you think about how much work it takes to build, run and upgrade a national mobile network, trust me it’s a lot more work than making a cup of coffee,” he said.

Rogers said its wireless expenses had increased by 5% in the holiday quarter and 9% over the year, while its wireless revenues increased by 4% in the quarter and 5% over the year.

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