BCE Inc Earnings Call Nuggets: Wireless Usage, Fibe

On Thursday, BCE Inc (NYSE:BCE) reported its first quarter earnings and discussed the following topics in its earnings conference call. Take a look.

Wireless Usage

Maher Yaghi – Desjardins Bank: I just wanted to ask you on Wireless side, I was quite surprised by seeing your usage per subscriber going up from 256 minutes to 285 million in the quarter. Can you maybe talk a little bit about what’s driving this higher usage in Wireless? On the ARPU, of the 4.2% increase in ARPU, how much of that is because of your prepaid has declined year-over-year? I mean just trying to understand what’s driving this increase. Is it mainly on the back of postpaid ARPU increases or the mix is helping the ARPU increase?

George Cope – President and CEO: On the usage, it really would be the growth in our overall postpaid base and also the continued growth we are seeing on the business side and winning back some market share business we’d have lost a number of years ago and we didn’t have things like global roaming, et cetera. So I think that’s driving. In terms of our overall ARPU, we’re as you know, trying to now report the mixed ARPU only but to help answer the question for the analyst, both our postpaid and prepaid ARPU were up year-over-year, but at the same time because we’re doing more postpaid the overall mix has helped as well. To give you a little more color, you saw our data revenue growth, our voice ARPU was down about 4.9% a year and data growth you’ll see on what we’ve reported. So hopefully that will help all the analysts to get a sense of what – where we were in total.

Fibe 

Phillip Huang – UBS: I wanted to touch on something that George mentioned earlier. Given your Fibe TV footprint is still rapidly expanding, can you maybe talk a bit about when we could look forward to a reversal of the diluted effects to ARPU and margins from the current six-months acquisition (primarily) on Fibe? I believe in Telus’ you said – they had said it would be around 500,000 subscriber mark. I am just wondering if that’s rough similar benchmark that we should use.

George Cope – President and CEO: I can’t really comment on to what a competitor would have said, what I would say. One of the things we did change, we’ve tried to go from 12 months promotions to six months promotions and the real reason we’re doing that is we’re finding and I think people would get it from a customer perspective. After 12 months it feels much less like a promotion and more like a rate plan. So it becomes a much more expensive at the call center in terms of customer calling in a month 13 because in fairness they forgot they had a 12-month promotion. So we’re trying to front-end load as much of the discounts in a six-month basis, a little more like the Wireless model. The Wireless has never had 12-month type of promotion before. So that’s what we’ve been trying to do. In terms of the ARPU flow-through, we definitely will see a maturing of the IPTV base after the six months and that helps but it’s a growth to your point of IPTV subs. The pace of that, of course, has some impact, but overall the most important part for us in the quarter is in the territories where we had IPTV, we were actually RGU positive for the quarter and we see the footprint growth as we said we’re going to go from the 2 million to the 3.3 million at the end of this year. All that we think bodes well for us in terms of getting the Wireline as we go through that continual challenge Wireline as a way to help moderate that with the growth on the IPTV. Hopefully that’s helpful.