Telus' Entwistle: DOCSIS 3.1 won't impact the pace of our FTTP rollout

Telus is not afraid of the impending threat of cable competitors rolling out DOCSIS 3.1 networks and is ready to respond through its ongoing fiber-to-the-premises (FTTP) rollout in its wireline territory.

Speaking to investors during the third-quarter earnings call, Darren Entwistle, CEO of Telus, said that its FTTP build is on track and gives it a foundation for a new growth source in its wireline business.

"As it relates to DOCSIS 3.1 deployment, I don't see it materially impacting the pace of our fiber deployment," Entwistle said during the earnings call, according to a Seeking Alpha transcript. "At the end of the day, fiber connectivity to the home is going to be a significant advantage for us. We've got a footprint now that's past 0.5 million homes and growing, and I think that that's a significant opportunity for you to contemplate in terms of reviewing the TELUS to grow tenant wireline, wireless positions."

Entwistle added that the returns on its FTTP "investment are extremely attractive from penetration to ARPU to churn, the cost reduction to improved reliability."

The service provider has continued to make progress with its FTTP build.

In October, it announced plans to invest $762 million over the next five years to connect the majority of Vancouver's homes and businesses to its FTTP network. Upon completion, Telus will be able to serve a mixture of over 400,000 homes, businesses, hospitals, community centers and municipal buildings.

Additionally, Telus completed an $11 million fiber network build connecting business and residential customers on Northern Vancouver Island and it is making similar investments in Edmonton, Alberta.

These new fiber builds are part of a broader $4 billion, three-year commitment in Canada to bring advanced services to every part of British Columbia and into Alberta province.

Initially, the FTTP network will deliver speeds of up to 150 Mbps with plans to deliver higher speeds over the next five to six years. However, Entwistle did not specify other speeds that it will provide.

"TELUS Fiber will provide citizens with access to Internet speeds of up to 150 megabits per second and increasingly higher speeds as they are enabled over our gigabit capable network," Entwistle said. Importantly, these investments support our track record and long term approach to balancing the allocation of capital to consistently deliver on both our broadband customer investment and shareholder return strategies."

Broadband and IPTV were highlights of its third-quarter earnings report. It added 24,000 new broadband customers, 2,000 more than it added in the same period a year ago. Telus said the increase reflects the expansion of its high-speed broadband footprint in urban and rural communities, including FTTP, and the pull-through effect of Optik TV. Total TV net additions of 26,000 were higher by 3,000 over the same quarter a year ago due to the expansion of Telus' addressable high-speed broadband footprint, increasing broadband speeds and improvements in customer churn rate.

While broadband data and IPTV are the initial services available on the FTTP network, Entwistle sees it becoming a foundation for small cell backhaul and health monitoring.

"It's no longer just about fiber for TV and HSIA, but it's fiber to backhaul, the small cell topology that we're building within our neighborhoods," Entwistle said. "And it's fiber to backhaul things like home health monitoring, such as the initiative that we have right now with the government of BC where we're putting pulse oximeters and BP cuffs and glucometers in homes and we want to backhaul that data traffic and put it in the hands of clinicians, docs, providers and caregivers to make sure that we deliver better health outcomes with better health information."

For more:
- see the earnings transcript (sub. req.)

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