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Bell selects Nokia as 'first' 5G vendor, sees earnings increase in Q4

Shruti Shekar
Telecom & Tech Reporter
A Bell Canada office is pictured in downtown Ottawa November 26, 2008. REUTERS/Chris Wattie/File Photo GLOBAL BUSINESS WEEK AHEAD PACKAGE - SEARCH 'BUSINESS WEEK AHEAD 31 OCT' FOR ALL IMAGES

Bell (BCE.TO) announced a 12.6 percent net earnings increase totalling to $723 million in Q4 2019 or 74 cents per share. 

The carrier’s operating revenue for the quarter was $6.31 billion, a 1.6 per cent increase year-over-year. 

The carrier said it added over 120,000 new wireless subscribers in the quarter, which include monthly subscribers and prepaid subscribers. 

Bell also announced a five per cent dividend increase.

Bell’s churn rate, the measure of subscribers who deactivate their service, increased 2 basis points to 1.28 per cent.

It said this was “due to the seasonally high level of competitive intensity in the quarter and selective matching of aggressive competitor promotions.”

Average Billing Per User (ABPU) decreased by 0.4 per cent to $67.20 in Q4.

Bell’s CFO Glen LeBlanc said that this was a result of “absorption of the unlimited data plans with results in lower data overage.” He said this is expected to continue into calendar 2020. He noted that these numbers do not “include equipment financing fees.”

Unlike its competitor Rogers, which reported it now has 1.4 million customers subscribed to unlimited data plans, Bell did not reveal how many customers it now has on unlimited plans. 

Bell selects Nokia as “first” 5G vendor, doesn’t rule out partnering with other suppliers

During the conference call, Bell’s CEO Mirko Bibic said it has selected Finnish company Nokia as its 5G vendor, but doesn’t rule out partnering with other suppliers. 

“Nokia will be the first provider of 5G...I stress the word first as we need to work with many equipment suppliers today and in the future. It includes Nokia, Huawei, Cisco, it is important to include multiple suppliers,” Bibic said. 

The company uses Huawei’s network equipment in areas that are not the core. The federal government is still reviewing whether or not it intends to ban the Chinese telecommunications manufacturer from participating in Canada’s 5G rollout.

“We are still waiting on a government review but as we have shown this morning, we are ready to deploy 5G,” Bibic said. 

In the earnings report, Bell said that it will deliver initial 5G service in urban centres across the country as 5G-enabled smartphones are made available.

Bibic also said that to deploy 5G it will do it with its normal capital expenditure and capital intensity ratio. Cormark Securities predicted that wireless capital intensity will increase slightly in 2020.

Rogers has partnered with Swedish company Ericsson to deploy its 5G network, while Vancouver-based national carrier Telus has not announced its 5G vendor yet.