Canada’s major telecom providers, including Rogers, Telus, Bell, and Quebecor, are experiencing a surge in subscriber growth due to the country’s significant immigration increase. Morningstar DBRS, a credit-rating agency, highlights this trend in its recent report. As a result of Canada’s “ambitious” immigration strategy to welcome 500,000 immigrants annually until 2026, the telecom industry is expected to continue attracting new customers in the short term.
However, the report also emphasizes the need for substantial investments in network infrastructure to meet the rising demand for services. This is essential as the surge in mobile internet users and the shift to hybrid work models contribute to heightened demand for data and bandwidth.
Vikas Munjal, vice-president of diversified industries at Morningstar DBRS, noted that while Canada’s immigration strategy will continue to bring new customers for major carriers in the near term, subscriber growth may face challenges if immigration and economic growth slow down. This could potentially intensify competition among carriers or increase costs to acquire or retain subscribers.
It’s important for telecom companies to invest in their networks to keep up with this demand. However, not all telecoms are prepared to increase their capital expenditures. Bell announced plans to reduce its fiber investments by $1.1 billion by 2025 due to decisions made by the federal government. On the other hand, Rogers and Telus have not announced any major spending cuts as they await the CRTC’s decision on mandating wholesale fiber access.
As Canada continues to welcome a high number of immigrants and experiences an increase in mobile internet users and hybrid work models, it is crucial for telecom companies to adapt and invest in network infrastructure accordingly. This will ensure they can meet the growing demand for data and bandwidth while continuing to attract new subscribers.
Stay tuned for more updates on how these developments may impact your telecommunications services!
