Cogeco targets low-data users with new Canadian mobile service

President and CEO Frédéric Perron said Wednesday that Cogeco plans to cover 12 Canadian markets in parts of Ontario and Quebec over the coming weeks, ahead of a full commercial launch of the service this fall. The company has said mobile coverage would be available across its broadband footprint. “We’re ready to go,” he told analysts on a conference call discussing the company’s third-quarter earnings results.

Pricing details TBD as Cogeco targets existing subscribers with bundles

But Perron declined to share pricing details for its wireless service, saying the company wants to announce those offers to its customers first. He noted that mobile service will remain exclusive to those also subscribed to its wireline services. By offering cellphone and internet plan bundles, Cogeco has previously described its strategy as being geared toward increasing customer retention.

Perron said Cogeco will also provide a “time-limited launch bonus” for the first wave of customers signing up for mobile service. When asked by an analyst how “aggressive” Cogeco plans to be in terms of pricing, he reiterated that those discounts wouldn’t remain in place over the long term. “It’s not a strategy to go national or anything like that,” he said. “We’re a rational player. Of course, when you launch a new service, there can always be a time-limited launch offer, but that’s just what it is—a time-limited launch offer.”

Cogeco leverages MVNO rules for Canadian wireless rollout

Last year, Cogeco began offering wireless service under its Breezeline Mobile brand to customers in 13 U.S. states where it already offered broadband internet services. In Canada, Cogeco’s mobile coverage is being delivered under the mobile virtual network operator framework, which allow telecoms to offer cellphone service through rival carriers’ networks.

The MVNO framework was put in place by the CRTC. The rules set by the regulator are meant to increase cellphone competition by giving regional carriers a presence in regions they did not previously serve, with requirements to build their own networks in those areas within seven years.

“It will take some time before wireless becomes material in a positive way to our bottom line,” said Perron.

Wireless launch overshadows revenue downgrade and U.S. struggles

The wireless launch announcement came as the company reported a profit attributable to owners of the corporation of $20.5 million in its quarter ended May 31, up from $19 million in the same quarter last year. Cogeco said its profit amounted to $2.13 per diluted share for the quarter, up from $1.97 per diluted share in the same quarter last year.

But analysts took a negative view of the company’s results, in which Cogeco also revised its 2025 guidance. Cogeco said it was lowering its revenue projections for the current fiscal year to a “low single-digit decline,” compared with its previous projection from last October of “stable” revenue for the year.