BCE Inc. will start building out its 5G network with equipment supplied by Nokia Corp. as it waits for the federal government to decide if Huawei Technologies Co. Ltd gear can be used, the company told investors during its fourth quarterly earnings call Thursday morning.
Bell CEO Mirko Bibic stressed the deal with the Finnish vendor was the first the company would sign, but said its desire to be competitive meant Bell was ready to deploy “initial” 5G service, with “true” 5G to be launched in 2021 following this year’s 3.5 GHz spectrum auction.
“What I’m trying to signal here is we need to be able to work with many equipment suppliers today and in the future and today that includes Nokia, it includes Huawei, it includes [Ericsson AB], it includes [Cisco Systems Inc.],” Bibic said in his first earnings call since replacing George Cope in the top job.
“It’s always prudent to have multiple supply sources and we’re always looking for that flexibility.”
Both Bell and Telus Corp. have relied heavily upon Huawei equipment for previous 3G and 4G LTE network build outs, but it was effectively banned from the sensitive core of the networks under the Canadian Security Establishment’s security review program. Bibic did not comment on a U.K. government decision to allow Huawei to be used in its 5G network roll-out, but ban it from the core of the network.
Bibic said Bell’s initial 5G rollout would be in urban Canada, threatening that the buildout in suburban and rural parts of the country could be impacted by regulatory decisions, including whether mobile virtual network operators (MVNOs) are given mandated access to network infrastructure. The CRTC will hold a public hearing, beginning on Feb. 18 as part of its review into mobile wireless services.
“The first build outs will be in urban areas, so what that means is you wait and see what the decision is going to be before you make any concrete plans to build out in the less dense areas,” Bibic told investors.
“These are all the consequences of regulatory overhang, that’s how you manage it.”
Bibic declined to say by how much Bell’s capital expenditure could be cut as a result of potential adverse regulatory decisions, but said last summer’s cut to its fixed wireless rollout following a CRTC decision to lower wholesale rates for internet service had already showed that investment cuts would follow “negative regulatory decisions”.
Rogers Communications Inc. issued a similar warning about how the regulatory environment could lead to cuts in capital expenditure in its Jan. 22 quarterly earnings call.
Several of the country’s biggest telecoms, including Bell, have appealed the rates decision in the Federal Court of Appeal.
“I hope we don’t have to see [cuts] again – but that’s just the way it works,” Bibic said in response to a question from Desjardins financial analyst Maher Yaghi. Bibic said he had faith that the CRTC would base its decision around mandating MVNO access on the evidence, which he said was “rather compelling” that allowing access would be “the wrong thing to do”.
For the three months ending Dec. 31, total revenues were up 1.6 per cent over last year to $6.32 billion, while net earnings surged by 12.6 per cent to $723 million.
Bell’s wireless revenues were up 3.6 per cent to $2.49 billion, on the back of 123,582 wireless subscriber additions, bringing the total to 9.96 million wireless subscribers. That wireless activation figure was a 13.6 per cent fall on 12 months prior, but the decrease in wireless adds was almost entirely concentrated in prepaid.
Its wireline revenues were flat, increasing by 0.1 per cent to $2.97 billion. New internet subscribers increased by 9.6 per cent, to 35,639, for a base total of 3.55 million.
Average billing per unit (ABPU) dropped .4 percent to $67.20 from $67.46.
Satellite TV subscriber losses totalled 21,618, a seven per cent improvement compared to the same period last year, for a total of just over 1 million total satellite subscribers. Meanwhile, Bell’s IPTV subscriber adds increased by 22,039, a 39.6 decrease on the 12 months prior for a total of just under 1.77 million. The total TV base sat at roughly 2.7 million, a 0.2 per cent increase on 2018.
Media revenues increased 3.4 per cent to $879 million.
Read original article at thewirereport.ca.