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Telus offer, a very rough take on the numbers

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Anonymous
May 19, 2004 6:53:45 AM

Archived from groups: alt.cellular.fido (More info?)

Telus is offering $1.1 Billion for Fido, with just over 1.1 million
customers, so they are paying about $1000 per customer.

I looked at some numbers, given that Fido is pushing prices down, it is
likely that the demise of Fido could lead them to an effective increase
of 20% in rates (yes, it will all be hidden, changes to per minute
billing, changes to LD costs, text costs, picture messaging costs, and
for their existing Telus customers not having to reduce rates to keep
them from jumping to Fido, but still a 20% increase in revenue per
customer over what they would have had received. )

Say they loose 30% of Fido customers, gives them 800 000 new customers
from Fido. They have something like 3500000 customers now.
(http://strategis.ic.gc.ca/epic/internet/insmt-gst.nsf/e...
and I assumed they have gained customers since)

Effective rate increase of 20% for 800 000 ex Fido plus 3500 000 000
Telus customers gives them 4 300 000 customers at 20% increase over $55
ARPU per month = $47 000 000 per month extra, or $560 000 000 extra per
year.

They pay for the Fido purchase in 2 years!!

These are very rough numbers and I have not analyzed the debt they may
take on, but even if it takes 5 years to pay for Fido, still a great
deal for Telus and a rotten deal for every wireless customer in Canada,
Fido, Telus, Rogers and Bell customers alike.

The Federal Government's 'made in Canada' telecommunication policies
have clearly failed.

Andrew
Anonymous
May 19, 2004 12:01:42 PM

Archived from groups: alt.cellular.fido (More info?)

"AndrewH" <Andrew-Lists@shaw.ca> wrote in message
news:Z_zqc.530413$Ig.50736@pd7tw2no...
> Telus is offering $1.1 Billion for Fido, with just over 1.1 million
> customers, so they are paying about $1000 per customer.

Assuming all they got from the Fido purchase were customers. This is
CLEARLY false. The purchase of Fido would bring with it extra spectrum (much
of which they wouldn't be able to keep though), many tower locations in
urban areas, and GSM equipment they can sell off. TTYL
Anonymous
May 19, 2004 7:03:39 PM

Archived from groups: alt.cellular.fido (More info?)

You forgot about the tax loss that Microcell is carrying, it's worth up to
2B to the right buyer. Telus can use 560M of it in the first year. Given
your numbers, Telus pays for Microcell in under a year. Wish I could use the
tax loss..


"AndrewH" <Andrew-Lists@shaw.ca> wrote in message
news:Z_zqc.530413$Ig.50736@pd7tw2no...
> Telus is offering $1.1 Billion for Fido, with just over 1.1 million
> customers, so they are paying about $1000 per customer.
>
> I looked at some numbers, given that Fido is pushing prices down, it is
> likely that the demise of Fido could lead them to an effective increase
> of 20% in rates (yes, it will all be hidden, changes to per minute
> billing, changes to LD costs, text costs, picture messaging costs, and
> for their existing Telus customers not having to reduce rates to keep
> them from jumping to Fido, but still a 20% increase in revenue per
> customer over what they would have had received. )
>
> Say they loose 30% of Fido customers, gives them 800 000 new customers
> from Fido. They have something like 3500000 customers now.
> (http://strategis.ic.gc.ca/epic/internet/insmt-gst.nsf/e...
> and I assumed they have gained customers since)
>
> Effective rate increase of 20% for 800 000 ex Fido plus 3500 000 000
> Telus customers gives them 4 300 000 customers at 20% increase over $55
> ARPU per month = $47 000 000 per month extra, or $560 000 000 extra per
> year.
>
> They pay for the Fido purchase in 2 years!!
>
> These are very rough numbers and I have not analyzed the debt they may
> take on, but even if it takes 5 years to pay for Fido, still a great
> deal for Telus and a rotten deal for every wireless customer in Canada,
> Fido, Telus, Rogers and Bell customers alike.
>
> The Federal Government's 'made in Canada' telecommunication policies
> have clearly failed.
>
> Andrew
!