Bell Canada is completing its accelerated network expansion. In its 2Q22 earnings call in August, the company reported that by year-end it will have invested over $10 billion since 2020, including total planned capital expenditures of approximately $3.7 billion for 2022.
These figures represent what Bell says are “the highest amount ever by a Canadian telecom company in both a single year and over a three-year cycle. These massive investments are going towards our fiber-to-the-home and 5G wireless core networks, ongoing expansion into rural and remote communities, as well as boosting capacity and ensuring resiliency.” Bell’s accelerated capex is a strategic bet that by upgrading its network with high speed data and internet connections for mobile and wireline customers, it will retain existing customers and attract new ones from competitors.
BCE, Bell Canada’s parent company based in Montréal, is a three-part conglomerate. Of its $7.6 billion year-to-date total service revenues, Bell Wireless accounts for 38 percent, Bell Wireline is 50 percent, and Bell Media adds another 12 percent. The company allocates capex according to its specific build plans. It reported 2Q22 capex of $874 million for its FTTH and 5G deployments. Of that total, $668 million was for wireline and $206 million went to wireless.
Year-to-date, Bell spent $1.6 billion on wireline and wireless projects. Bell Wireless’ full-year 2022 capex budget is around $825 million, with capital intensity in the 17-18 percent range. Through 1H22, the company invested $388 million, less than half of the budget, suggesting an uptick in wireless network investment through the balance of the year.
Bell also announced the commercial availability of what it dubs as 5G+ in Toronto and parts of Southern Ontario. 5G+ is the next evolution of 5G using the 3500 MHz spectrum obtained in the ISED auction last year, as Inside Towers reported. Bell expects to cover approximately 40 percent of the Canadian population with 5G+ by the end of 2022, including the Greater Toronto Area, Halifax, Nova Scotia, St. John’s, Newfoundland and Sherbrooke, Québec.
The company also announced the upcoming rollout of its nationwide 5G Standalone core to enable the development and delivery of new, advanced services with lower latency and greater capacity. Bell continues to work with partners on 5G and network innovations.
For the quarter, Bell Wireless service revenue grew 8 percent YoY to over $1.2 billion, driven by larger mobile phone and connected device subscriber bases and higher blended mobile phone ARPU that reflected higher roaming revenue with the easing of COVID-related global travel restrictions. Wireless adjusted EBITDA increased over 8 percent to $770 million on the flow-through of strong service revenue growth.
Bell added 110,761 net new postpaid and prepaid mobile subscribers in 2Q22. That tally is up 140 percent over the nearly 47,000 subscribers added in 2Q21. Bell’s mobile customer base at the end of Q2 totaled 9.6 million, growing more than 4 percent YoY, comprising 8.7 million postpaid subscribers and 855,000 prepaid customers.
It is interesting that Mirko Bibic, BCE President and CEO sought to distance Bell from the major network outage that Rogers incurred in July, as Inside Towers reported. In remarks during the company’s 2Q22 earnings call, Bibic said, “Bell’s wireless and wireline networks use different network infrastructures and are configured such that a major disruption on the wireline network does not take down the national wireless network. Since 2013, we have protected our core from the internet through the use, among other things, of multiple geographic zones to route traffic. Moreover, in the event of a localized outage, we have built an automated customer notification system starting first in Quebec and then Ontario. While it’s clear that no network is perfect or immune to outages, network architecture clearly does make a difference.”
By John Celentano, Inside Towers Business Editor
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