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CRTC Communications Monitoring Report

2010

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3.0 The Communications service industry

This pie chart shows the broadcasting and telecommunications revenues as a percentage of total Industry revenues in 2009. Broadcasting: 26%; Telecommunications: 74%; Industry revenues: $55.4 billion.

3.1 Communications service industry overview

This section provides a broad overview of the broadcasting and telecommunications service industries (the Canadian communications service industry), and briefly examines how network convergence is enabling industry participants to offer communications services outside of their traditional core services. In 2005, revenues of incumbent TSPs and cable companies, as a percent of total communications revenues, were approximately 59% and 23%, respectively. At the end of 2009, their revenues represented 52% and 31% of total communications revenues, respectively. The financial performance of individual sectors within broadcasting and telecommunications is found in sections 4 and 5.


Communications service industry at a glance

      Growth
 ($ billions) 2008 2009 2008-2009
Communications revenues 54.3 55.4 2.1%
Broadcasting 14.0 14.4 3.0%
Radio 1.6 1.5 -5.2%
TV 5.5 5.5 -0.2%
BDU 6.9 7.5 7.4%
Telecommunications 40.3 41.0 1.8%
Incumbent TSPs 28.7 28.8 0.6%
Cable companies 16.1 17.3 7.4%
Communications revenues to GDP (Percent) 4.4% 4.6% 5.1%

Source: CRTC data collection

 

Statistical information – Financial overview

Table 3.1.1 Telecommunications and broadcasting revenues ($ billions)

  2005   2006   2007   2008   2009   Growth
2008-2009		 CAGR
2005-2009
Wireline 23.5   23.4   23.7   24.2 # 24.1   -0.5% 0.7%
Wireless 11.0   12.7   14.5   16.0   16.9   5.3% 11.3%
Total telecommunications revenues 34.5   36.1   38.2   40.3   41.0   1.8% 4.4%
Radio AM/FM 1.3   1.4   1.5   1.6 # 1.5   -5.2% 3.1%
Television 4.7   5.0   5.3   5.5 # 5.5   -0.2% 4.1%
BDU 5.3   5.8   6.3   6.9 # 7.5   7.4% 8.9%
Total broadcasting revenues 11.3   12.2   13.1   14.0   14.4   3.0% 6.3%
Total telecommunications and broadcasting revenues 45.8   48.3   51.3   54.3   55.4   2.1% 4.9%

Source: CRTC data collection


Figure 3.1.1   Broadcasting and telecommunications annual revenue growth rates

This line chart shows the broadcasting and telecommunications annual revenue growth rate for each year between 2005 and 2009. Telecommunications: 3.0%, 4.6%, 5.8%, 5.4% and 1.8%; Broadcasting: 5.0%, 8.2%, 6.8%, 7.2% and 3.0%.

 

Source: CRTC data collection


Table 3.1.2   Industry revenues by type of provider ($ thousands)

  2007   2008   2009   Growth
2008-2009		 CAGR
2007-2009
Incumbent TSPs              
Telecommunications 26,710.2   27,151.5  # 26,719.7   0.1% 0.9%
Broadcasting undertakings 1,311.0   1,510.0   1,662.4   10.1% 12.6%
Subtotal 28,021.3   28,661.5  # 28,842.1   0.6% 1.5%
Utility telcos and other TSPs 488.1   585.8  # 723.7   23.5% 21.8%
Resellers 1,774.5   1,862.2  # 1,594.7   -14.4% -5.2%
Cable Companies                
Telecommunications 9,231.6   10,674.3  # 11,519.7   7.9% 11.7%
Broadcasting undertakings 4,998.3   5,443.4   5,792.9   6.4% 7.7%
Subtotal 14,229.9   16,117.7  # 17,312.6   7.4% 10.3%
Broadcasting - Other entities 6,760.8  # 7,058.4  # 6,974.5   -1.2% 1.6%
Total 51,274.6   54,285.6  # 55,447.5   2.1% 4.0%

Source: CRTC data collection

 

Table 3.1.3  Industry convergence: Broadcasting v. Telecom

Year Percent of incumbent BDUs’ revenues from telecom services Percent of ILECs’ revenues from broadcasting services
2009 66.5% 5.8%
2008 66.2% 5.3%
2007 64.9% 4.7%

Notes

  1. Telecom services include: Local & access, long distance, Internet, data & private line, and wireless.
  2. Broadcasting services include: Radio, television, pay & speciality, and BDU.

Source: CRTC data collection

 

Figure 3.1.2 Broadcasting and telecommunications revenues by type of provider (2009)

This pie chart shows the total broadcasting and telecommunications revenue market share by type of provider in 2009. Data is taken from table 3.1.2 above. There are five types of providers in this pie chart. Incumbent TSPs: 52%; Broadcasting and other entities: 13%; Cable companies: 31%; Resellers: 3%; Other facilities-based TSPs: 1%.

 

Source: CRTC data collection


Figure 3.1.3  Commercial broadcasting and telecommunications revenues
(excluding non-programming and exempt services)

This clustered column chart shows the telecommunications, broadcasting, and combined broadcasting and telecommunications revenues in billions of dollars for each year between 2005 and 2009. Telecommunications: 34.5, 36.1, 38.2, 40.3 and 41.0; Broadcasting: 11.3, 12.2, 13.1, 14.0 and 14.4; Combined broadcasting and telecommunications: 45.8, 48.3, 51.2, 54.3 and 55.4.

Source: CRTC data collection


Figure 3.1.4  BDU revenues by service type

This combination of a clustered column and plotted dot chart shows BDU revenues in millions of dollars by type of service for each year between 2005 and 2009. Revenues from basic and non basic programming services: 5,310, 5,791, 6,321, 6,941 and 7,455; Revenues from exempted programming and non programming services: 1,445, 2,085, 2,768, 3,483 and 4,102; Total BDU revenues from all services: 6,755, 7,876, 9,080, 10,424 and 11,557.

Source: CRTC data collection


Figure 3.1.5  BDU – EBITDA margins achieved from all services (programming, exempted and non-programming services)

This line chart shows the EBITDA margins achieved by Cable, DTH and MDS, and Cable, DTH and MDS combined for each year between 2005 and 2009. These margins reflect operating results from all services (programming, exempted programming and non programming services. Cable: 42.7%, 41.7%, 40.2%, 44.5% and 45.1%; DTH and MDS: 13.6%, 15.6%, 16.9%, 18.9% and 21.0%; Cable, DTH and MDS combined: 36.0%, 36.1%, 35.4%, 39.4% and 40.5%.

Source: CRTC data collection


Figure 3.1.6  Select Canadian communications companies revenue composition

This flow chart illustrates the various types of players in Canadian communications industry and how they deliver their service offerings to consumers explained in subsection 3.1: A Converging Industry.

Note:
(1) Bubbles represent estimated total telecommunications and broadcasting revenues in 2009.

Source: Company websites and other public annual reports

 

Figure 3.1.7  Broadcasting and telecommunications operating platforms

The bubble chart illustrates the makeup and relative revenue magnitude of eight selected companies. Each company is displayed by a bubble which represents the magnitude of the respective company’s Canadian telecommunications and broadcasting revenues. The position of the bubble determines the extent of each company’s telephony versus broadcasting revenues; the closer the bubble is to the x-axis indicates that the company generates revenues mainly through broadcasting activities and vice versa for telecommunications revenues in 2009.

Figure 3.1.8  Regulatory considerations in a converging industry

This chart describes the various regulatory issues that arise in a converging communications industry. The chart presents three main categories of convergence: corporate, technology, and customers. In each of these three categories, there are several regulatory issues, among others, that the communications industry as a whole needs to address. Under corporate convergence, there are issues such as diversity of voices, Canadian content production and market structure. Within technology, there are issues such as broadcasting act and new media, net neutrality, broadband deployment, basic service obligation, and spectrum management. And regarding customers, this category is expanded to look at issues which relate to the wholesale and retail customer segment. Some of these customer issues include essential services, quality of service, open access for devices, unwanted calling and spam, privacy, affordability, accessibility and others.
  Date Modified: 2010-08-12

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