Canadian Wireless Industry profits soar 34%

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Operating profits in the wireless phone industry reached $1.2 billion in the third quarter of 2006, up 34.4% from the corresponding period in 2005 according to numbers released by StatsCan this week.

Profits jumped thanks to a rapid 16.4% increase in revenues and a much smaller increase of 8.8% in operating costs.

Wireless operating revenues were $3.4 billion and operating costs were $2.2 billion in the third quarter of 2006. This meant that 34.4 cents of every dollar earned by the Wireless industry was profit.

The growth in revenues was attributable to strong growth in the number of subscribers and average revenues per subscriber.

There were 17.6 million wireless subscribers on September 30, 2006, which was 1.6 million or 10.1% more than a year earlier. Average revenues per subscriber climbed 5.7% in one year, from $180.60 in the third quarter of 2005 to $190.80 in the third quarter of 2006. This meant the average wireless subscriber spent $63.60 for wireless service during this time period.