Bell’s fibre footprint to ‘plateau’ after Ottawa sticks with CRTC’s wholesale policy

The chief executive of BCE Inc. says the company expects its Canadian fibre footprint to “plateau” rather than expand after the federal government announced it wouldn’t interfere with a contentious regulatory decision surrounding wholesale access to internet services.

President and CEO Mirko Bibic said Thursday that Bell has already built out its fibre internet network to around eight million homes, however, the company doesn’t currently plan to grow that number. It marks a significant scale back from its previous plan to reach nine million homes, a figure that was later revised to 8.3 million before it was lowered even further.

Those decisions were in direct response to the CRTC’s framework allowing other internet providers to sell fibre services to customers, using networks built by incumbent companies such as Bell, in exchange for a fee.

Bell was particularly irked by a provision that allows Canada’s largest internet providers — Bell, Telus Corp. and Rogers Communications Inc. — to re-sell internet on existing fibre networks built by others, as long as they do so outside their core serving regions.

Arguing that it discourages major providers from investing in their own infrastructure, Bell slashed $500 million in investment plans this year.

On Wednesday, Industry Minister Mélanie Joly said Ottawa wouldn’t overturn the CRTC’s policy following a federal review.

“We’re disappointed with the government’s decision to uphold the CRTC decision,” Bibic said in an interview.

“At this stage now, we just urge the government and CRTC to ensure that network builders are fully compensated for the significant build costs and the significant investment risk we take when we build.”

Under the CRTC’s rules, any new fibre infrastructure built by the large telecoms can’t be made available to competitors until 2029. The regulator has said its framework effectively balances the need for both competition and investment.

In her decision, Joly said the CRTC’s policy “will immediately allow for more competition on existing networks.”

Telus began offering fibre internet service throughout Ontario and Quebec last November under the wholesale regime and has said it plans to extend its offerings to the Atlantic provinces too.

Bell has argued such access to its network shouldn’t be made available to its largest rivals.

“Imagine spending billions of dollars in order to generate a return, and then a regulator tells you that you have to give that asset to somebody else so they can make a return instead,” Bibic said.

“When you put it in those terms, people start looking at you saying, ‘Really? That doesn’t make any sense.'”

While Telus applauded Joly’s decision, other companies sounded alarm bells. Rogers spokeswoman Sarah Schmidt called it “a shocking reversal from the federal government’s principled position less than one year ago,” referring to an order from Ottawa for the CRTC to reconsider whether the Big Three providers should be able to act as wholesalers.

At the time, Ottawa cited concern about the viability of smaller internet providers to act as alternatives under the framework.

“The Carney government has declared its priority is to build a strong Canada and this decision does the exact opposite. It does not incent Canadian companies to invest in Canada,” Schmidt said in a statement.

“Virtually the entire industry, including small and regional providers, urged our elected officials to reverse the CRTC decision. The impact of this decision will include cuts to capital investment, a loss of network construction jobs, and reduced competition which will mean higher prices for Canadians.”

The Competitive Network Operators of Canada, an industry association representing independent providers, called it “a missed opportunity to foster real competition.”

“Instead, the government appears to be backing a single player at the expense of the providers that have long delivered genuine choice to Canadians,” said CNOC president and chair Paul Andersen.

Last month, Cogeco Inc. and Halifax-based Eastlink filed a legal challenge at the Federal Court of Appeal seeking to appeal the CRTC’s June decision to uphold its policy. Cogeco said it would continue to challenge “the CRTC’s broken, nonsensical wholesale internet regime”

“The federal cabinet’s inaction is unacceptable,” said Cogeco president and CEO Frédéric Perron in a statement.

“The CRTC’s current approach undermines choice and affordability, halting crucial innovation and investment vital for Canada’s future. Unless corrected, this policy will have a detrimental impact on consumers and the broader Canadian economy.”

Meanwhile, Eastlink said it would suspend planned upgrades to many smaller communities across Canada due to the government’s decision.

“I have instructed our team to take the next 30 days to identify communities that will become unprofitable and therefore require shutdown as a result of this decision,” said the company’s executive vice-chair Lee Bragg in a statement.

“We encourage consumers to reach out to their local MP to voice concerns about this decision and the unintended consequences of losing, not gaining, sustainable competition.”

While Bell’s Canadian fibre build has hit a standstill, the company sees growth potential south of the border after closing its $5 billion deal to buy U.S. fibre internet provider Ziply Fiber last week. The acquisition expands Bell’s fibre footprint into the U.S. by 1.4 million locations.

Under a previously announced plan, Ziply Fiber will become a long-term partner to Network FiberCo, created through a partnership deal between Bell and the Public Sector Pension Investment Board. Network FiberCo is focused on “last-mile fibre deployment” outside of Ziply’s incumbent service areas in the Pacific Northwest, enabling Ziply to potentially reach up to eight million total fibre passings in the U.S.

“The U.S. fibre market is very attractive, which is the reason why we’re so pleased to have closed the deal last Friday,” Bibic told analysts on a conference call Thursday, as Bell-parent company BCE Inc. reported its second-quarter results.

“U.S. fibre deployment lags Canada, we know that. Only 50 per cent or so of homes in the U.S. have fibre, so it’s a way of saying that the opportunity is pretty significant there as we start executing the fibre build.”

BCE also raised its guidance to reflect the deal. It now expects revenue growth of zero to two per cent in 2025, compared with its previous guidance that forecast between a three per cent loss and one per cent gain in revenue.

It reported its second-quarter net earnings attributable to common shareholders amounted to $579 million or 63 cents per share. The result compared with a profit of $537 million or 59 cents per share a year prior.

Operating revenue for the quarter ended June 30 totalled $6.08 billion compared with about $6 billion a year earlier.

On an adjusted basis, BCE earned 63 cents per share, down from an adjusted profit of 78 cents per share a year earlier. Analysts on average had expected an adjusted profit of 71 cents per share, according to estimates compiled by LSEG Data & Analytics.

BCE had a net gain of 44,547 postpaid mobile phone subscribers in its second quarter, compared with 78,500 net activations during the same period a year earlier. The company once again cited a “less active market,” slowing population growth due to federal immigration policies, and its own focus on “higher-value subscriber loadings” for the decrease.

The company said customer churn — a measure of subscribers who cancelled their service — was 1.06 per cent, down 0.12 per cent from a year ago. That marked its first quarter of year-over-year improvement since 2022.

BCE’s mobile phone average revenue per user was $57.61, down 0.7 per cent from $58.04 a year ago. It said that was due to the pressures of competition and discounting, lower data overage revenue as customers increasingly subscribe to unlimited or large capacity data plans, and lower roaming revenue amid decreased travel to the United States.

This report by The Canadian Press was first published Aug. 7, 2025.

Companies in this story: (TSX:BCE)

Sammy Hudes, The Canadian Press