VimpelCom has made no secret of its desire to rid itself entirely of its Canadian outpost, which makes up a relatively tiny portion of the company’s global operations.Fred Lum/The Globe and Mail
Even with its parent company struggling and its future far from clear, Canada's biggest little telecom carrier is showing signs of success.
Wind Mobile reported its 2014 fiscal first quarter earnings on Wednesday, calling them the best quarterly numbers in the Canadian telecom company's history.
Customer growth at Wind continued at a brisk 17-per-cent clip, year-over-year, as the company's total customer base passed the 700,000 mark. Average Revenue Per User, a metric frequently used by telecommunications providers, also jumped 12 per cent during the same time period, climbing to $31 per user. However that number is still only about half the revenue generated per customer at Canada's three largest carriers.
The company attributes its positive results to its focus on relatively inexpensive wireless plans, such as its $15-a-month unlimited U.S. Roaming deal.
But Wind's climbing revenue and user numbers do little to clear the uncertainty around the company's long-term future. Indeed, Wind's Amsterdam-based owner, VimpelCom Ltd., reported a 5-per-cent revenue decline for its first fiscal quarter. Overall, the conglomerate's customer base increased only 3 per cent in the quarter.
VimpelCom has made no secret of its desire to rid itself entirely of its Canadian outpost, which makes up a relatively tiny portion of the company's global operations. In March, VimpelCom effectively wrote off the entirety of its Canadian Wind business – citing Ottawa's foreign ownership rules, which prohibit the foreign company from taking full control of Wind. VimpelCom also cited the same reason for its decision not to participate in the 700-megahertz spectrum auction.
At the same time, VimpelCom faces myriad challenges in trying to sell Wind. For years, Ottawa maintained that the small telecom operators could not be sold to a major Canadian carrier – a move intended to boost competition in the country's wireless sector. And although those rules have now officially expired, there's no indication the Conservative government won't oppose such a sale regardless.
Even as it remains unclear how long VimpelCom is willing to support its subsidiary, Wind continued to reassure its growing customer base that it does have a long-term future in Canada.
"We have no doubt that 2014 will be a great year for WIND," the company said in a statement, adding that it has continued adding retail outlets and improving its network, and describing itself as "Canada's fourth national carrier."