RE:RE:RE:Sentiment has changed BlueDawn...great analysis as usual
While your conclusions are certainly possible, I have to disagree with them. I think the depth of the compression of the profit margins facing the legacy telecoms is large and when combined with subscriber losses will outweigh additional contributions from such things as Crave (which by the way none of my children use or their friends for that matter). There are times when I listen carefully to the younger generation to understand shifts in sentiment and to determine what is hot and what I should look at for investment purposes. As an example, back in the the 90s, I invested in the company which had developed Pokeman. The reason? My youngest was adicted to it before I had even heard of it. He told me all his friends at school were the same. What happened? I made 300% on my investment in a few months!! I believe seeing what they are doing is telltale and right now it isn't good for legacy telecoms.
As well as phone rates, one of my daughters-in-law said they were with Bell for their internet and had switched to another provider at a third the cost for the same service level. These are huge numbers IMO and are illustrative of the level of competition and compression of profit margins coming to the legacy telecoms. These numbers are much larger than offsetting contributions from things you suggest and will also happen faster IMO.
Your point about lower capital requirements is certainly valid and the company said it was reducing capital spending in its announcement months ago. It was actually one of the reasons that I held off selling all of my stake in BCE in the mid to high 40s. Since then after looking at it more closely, especially the size of the corporate debt and the associated interest costs, the numbers are huge and resulted in my decision to sell the rest and look elsewhere for investment targets.