Two of Canada’s biggest internet service providers are preparing to increase their monthly subscriber prices, a move they say is justified by the investments they’re making in their networks.
Rogers Communications will raise prices for most of its internet plans by $8 a month, starting Monday.
For its lowest-price plan, there will be a smaller increase of $4 per month for a package that delivers speeds of less than 20 megabytes per second.
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On April 1, Bell Canada will increase its internet prices by $5 a month for Ontario customers and by $3 a month for its customers in Quebec.
Bell will also increase internet overage charges to $4 per extra gigabyte, from $3 per gigabyte.
Both companies have said that the appetite for data services has been soaring because of growing consumer demand.
That’s consistent with a report by the federal telecommunications regulator, which said average monthly data consumption using home internet connections was up more than 23 per cent in 2016 compared with 2015.
Representatives for both companies said in separate emails that the price adjustments help fund improvements in the reach and capabilities of their networks.
“We regularly review our plans, and from time to time, we make changes,” Rogers spokeswoman Michelle Kelly said in an email Friday.
Bell spokesman Nathan Gibson said: “Bell invests about $4 billion a year to enhance our broadband networks and manage fast-growing customer usage. We occasionally make price adjustments to support expanded coverage and access speeds for products like Fibe Internet, Fibe TV and Alt TV.”
The two companies – which are competitors across Ontario – are each racing to install a new generation of landline networks for delivering internet, IPTV television and other services to homes.
Each is seeking to boost speeds and functions by getting fibre optics closer to the home while, at the same time, growing their revenue and profit margins.
Rogers chief financial officer Anthony Staffieri told analysts in a Jan. 25 conference call that the company expects “healthy cable margins in 2018, notwithstanding projected launch costs and subscriber licence fees for our new Ignite TV.”
The CFO for Bell’s parent BCE Inc., Glen LeBlanc, told that analysts during its Feb. 8 conference call that its wireline services had improved margins in the fourth quarter to 40.7 per cent, up from 40.1 per cent.
“This North American industry-leading margin provides us with ample room for accelerated fiber investment to continue going forward,” LeBlanc added.
