Telecommunications industry expected to ring up record profits in 2007



    OTTAWA, April 26 /CNW Telbec/ - After posting record profits last year,
Canada's telecommunications industry is expected to see profit levels increase
again to $4.3 billion in 2007, according to the Conference Board's Canadian
Industrial Outlook: Canada's Telecommunications Industry - Spring 2007.
    "Despite modest sales growth and minimal price increases, industry
profits reached a record high in 2006 thanks to weak growth in material and
capital costs," said Michael Burt, Senior Economist. "However, weak price
appreciation and a shrinking market for traditional wired services will limit
industry profit growth to an average of just 4.4 per cent annually between
2007 and 2011."
    Service carriers have been forced to adapt quickly to ongoing regulatory
and technological changes in the industry, including the increased
availability of Voice over Internet Protocol (VoIP) services. The number of
traditional fixed wire lines has steadily declined since its peak in 2001. The
number of cable telephony subscribers has surged over the past 18 months.
Also, the recent proposed regulatory changes related to local voice services
could further limit price appreciation over the forecast horizon.
    This is the first release of the Conference Board's new Canadian
Industrial Outlook: Canada's Telecommunications Industry. Published twice a
year, the content for this report was previously part of the Board's broader
information technology and communications industry report.




For further information:

For further information: Brent Dowdall, Media Relations, (613) 526-3090,
ext. 448, corpcomm@conferenceboard.ca


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