SaskTel's revenue drops $30M, annual report shows

The minister responsible forSaskTelsays the Crown corporationcan stay competitive despite increasing pressurefrom the private sector.

Minister Don Morgan spoke to reporters Wednesday at the release of SaskTel'sannual report for 2017-18, which shows it posted $1.2 billion in revenues with a net income of $121 million andpaid nearly $90 million in dividendsto the Crown Investment Corporation.

"There is private sector competition, so over the last number of years [SaskTelhas]developed a keen competitive edge and I think will continue to thrive in an increasingly competitive market," Morgan said.

"The market is changing. There's a challenge with cord cutters, there's increased competition. but I think thecorporation is well positioned to deal with those challenges."

SaskTelposted a $29.6 million drop in revenues from 2016-17, which is attributed to factors like changingcustomer habits, the current economic climate and regional wireless pricing from competitors like Telus, Bell and Rogers.

Some of these private competitors arepricingproductsup to 40 per cent lower in Saskatchewan than other provinces with the hope of gaining more of SaskTel'swireless market share. SaskTel currently controls 67 per cent of the market, about 1.5 per cent less than several years ago.

The report shows 40 per cent ofSaskTel'srevenue comes from wireless, while services like its maxTV package, data and Internetcomprise a 27.9 per cent slice of itsrevenue pie.

SaskTel's annual report also hows that as of Mar. 31, 2018, ithad 607,448 wireless customers, a dip from the previous year when the figure was 615.882.

SaskTelattributes most of that decline to cancelling a CDMA network, which rendered any devices usingout of service.

The report shows between March 2017 and March 2018 SaskTelgained some 3,600 Internet customers, including subscribers of maxTV.

Expanded rural service not just about business

SaskTelsays it's in the process of a four-stage plan to offer rural residents better cellular and high-speed Internet services.

Acting president and CEO Doug Burnett said it has already installed fusion towers in34communities and is planning to improve service to another 100 rural communities.

He told reporters he expects the installation of fusion towers to be profitable, and the additional expansion, "will be very close to break even."

Morgan acknowledged the ongoing push to improve access to rural communities is driven by social policy, not purely a business decision for the Crown.

"The analogy that I would refer you to isSaskPower where all the electrification took place in the 1950s, not always business decisions that would make sense on an individual basis, but on a province-wide basis certainly it was the right decision to do at that time," Morgan explained

"I think some of the decisions SaskTel is making now would be consistent with that type of approach."