Rogers Communications' Q3 Profits Fall

     Rogers Communications Q3 results have shown that their profits have declined. As competition has gotten aggressive with new pricing plans from the likes of WIND mobile, Bell Mobility and Telus Mobility, they've gained 25% less subscribers (125000) compared to the same quarter in 2009. Loss in revenue was also attributed by many early hardware upgrades for smartphones this last quarter. Rogers Communications earned $370 million or 64 cents per share in the last quarter, on a net-income ending September 30th. The earnings reported this quarter are off by 24% from the same quarter in the previous year when Rogers made $485 million or 79 cents per share. Rogers has been taking action lately and in related news, they bumped up the Hardware Upgrade Pricing eligibility from 24 months to 30 months with a 36 month contract. However, Rogers have of reverted back to 24 months HUP eligibility due to negative response from existing customers.

     As the case with most consumer services and products, Rogers Communications saw a drop in profit due to the drop in new subscribers or renewal of contracts as the competition got more aggressive. Consumers these days want more for their money, they want Caller ID, Voicemail, SMS and plenty of minutes to talk. However Rogers cannot offer an introductory plan that includes all that for what the competition is offering it for. At the other end, Rogers is offering good deals to some customers, that it actually attributes to Rogers losing potential revenue that could be gained. As there was an decrease in demand for Rogers Wireless, it was caused by substitute services such as WIND mobile, Bell Mobility and Telus Mobility. This'll eventually result in a decrease in pricing for introductory plans which would increase the amount of customers switching to Rogers. With decreasing pricing on price plans or even offering better bang for the buck, it'd help them a long way to have customers of other mobile services switch over to Rogers.

     Rogers should have been offering competitive price plans in the first place. From my own experience with Rogers, it appears as if their business model is based on the consumer coming to them, telling them what the consumers want and hand it out like candy on Halloween. It's how I got to where I stand with Rogers. Now that may very well work for people that are concerned about what they're paying for their service, however it may very well help if they revised their price plans to be slightly more competitive. And unlike any other wireless provider, they charge a Government Regulatory Recovery Fee which doesn't even have anything to do with the Government. It's just their way of having the cake and eating it too. And lastly, Rogers hasn't been offering many great phones for the past year or so. In order to stay competitive in the market, they have to update their devices to make them more appealing to consumers so they'd come over and settle for their price plans.

Source: http://www.bloomberg.com/news/2010-10-26/rogers-third-quarter-profit-declines-24-as-competition-pushes-down-prices.html

UK: Hosepipe Ban In North-West England

     As with water being an abundant resource here in Canada, it doesn't seem to be the case across the ocean. Back in July, United Utilities, the resources utility for the United Kingdom, announced a hosepipe ban for the North-West region of England. This was preceding the announcement of the reservoir levels falling during the driest conditions since 1929 and the need to preserve "essential supplies". The North-West only had 300mm of rainfall in the past seven months (from July) and this only pushed the temporary ban into effect. The ban will affect nearly 7 million people in the region. The ban is only restricted to hosepipe and sprinkler usage. This means that people won't be able to water their lawns or wash private vehicles. However the work around to the hosepipe ban would be to use a watering can or to wash your vehicle with a bucket and soap.

     In England, they haven't had such dry conditions since 1929. And the last time they've imposed a temporary ban was 14 years ago. 14 years. We think of water being an abundant resource, however at that point in time in England, water became a scarce resource for them. This could be due to global warming for all i know. The ban was designed to limit the use of water, as to predict with less usage overall, there'll be enough for emergency use, if needed. The part in preserving this water is to be assured, not the actuality of having it, that there'll be water regardless of a drought or not. It's a step but its not a step that works well.

     But to even think that we'd run out of water is out of my perspective. And to limit use thru a hosepipe ban seems ridiculous to me. There really is no point in doing so because, even if its summer, limiting the use of this water is pointless, regardless they'd be saving just a fraction of their water supply as opposed to not imposing the ban at all. There are people that want to clean their cars. There are people that want to have a healthy green lawn. Forget about using the buckets, you can't even do a decent job cleaning the car with just a bucket of water. And to think that the ban will be lifted in just the next couple of weeks, people don't want dirty vehicles for the next couple of weeks. People will just ignore the hosepipe ban and for them, it'll just be a normal summers day. And that emergency water they're mentioning, there's not going to be a need for it anyhow because they'll end up having enough when they lift the ban.

Source: http://www.guardian.co.uk/uk/2010/jul/07/north-west-hosepipe-ban

Welcome, First Post and Whats Coming.

Well it's my first post on this blog and to think that i'd have to blog for Economics is alright. However just to mix it up, mind as well throw a couple personal posts into the blog as well.

Posts for Economics will be clear, it'll be in a three paragraph layout and will usually be based on articles within the past 6 months. They might be marked with a star (*) in the title and the title will contain the geographical region to where it's relevant.

So enjoy the stay and hope to have some feedback.