Rogers Communications executives hailed the early success of the company’s new unlimited mobile tariff, despite a slowdown in subscriber and revenue growth in Q2.
During an earnings call, CEO Joe Natale said the response to the plans has been “overwhelmingly positive”, with 365,000 making the switch in the six weeks since their introduction.
Though the operator expected more higher-tier customers to downgrade to the lower-priced unlimited plans, he noted two-thirds of those who switched so far actually spent more to upgrade.
Data usage among unlimited plan users increased 50 per cent since launch, he added.
Executives also talked up the company’s newly introduced 24- and 36-month device financing options, noting more than half of customers taking up the offers are opting for the latter.
The company added 77,000 post-paid wireless subscribers in the quarter, down from 122,000 net additions in Q2 2018. Revenue growth also slowed, with overall and mobile revenue each increasing just 1 per cent to CAD3.78 billion ($2.9 billion) and CAD2.24 billion, respectively, compared with annual gains of 4 per cent and 7 per cent in Q218.
Net income in the recent quarter, though, was up 10 per cent to CAD591 million.
Natale acknowledged the operator was expecting “short-term moderation” in growth, but said the transition to the new unlimited and device financing plans will yield “superior economics” in the longer term.
The CEO also expressed confidence an investigation by the Canadian Radio-television and Telecommunications Commission into whether the new financing plans from Rogers and its rivals comply with existing regulations, will find them to be “right for consumers” and “aligned with intent and spirit of the wireless code”.
In addition to providing more options for consumers, CFO Anthony Staffieri said the plans will help Rogers reduce the more than CAD2 billion per year it spends on device subsidies and make room for margin growth.Subscribe to our daily newsletter Back