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Quebec’s Cogeco Shopping for U.S. Cable Companies to Buy

Phillip Dampier February 6, 2014 Atlantic Broadband, Canada, Cogeco, Competition Comments Off on Quebec’s Cogeco Shopping for U.S. Cable Companies to Buy

cogecoWith the Canadian cable business locked up by Shaw, Rogers, and Vidéotron, Ltd., suburban Ontario and Quebec cable operator Cogeco announced intentions to acquire at least one small U.S. cable company later this year after it pays down more debt.

CEO Louis Audet told shareholders that cable operators in Canada are large, very profitable, and absolutely not for sale. That leaves few growth opportunities for the fourth largest cable operator in Canada. Instead of spending money to expand its current footprint into unserved areas, the company will look south of the border for buying opportunities.

Audet

Audet

“What you see is pretty much what you get unless something really special comes out of left field,” Audet said. “The potential exists in the U.S. where it doesn’t in Canada.”

Cogeco’s financial resources are too limited to challenge the three largest cable operators in the country, and Audet said Cogeco has no intention of selling its own business. In eastern Canada where Cogeco provides service, Rogers Communications would be the most likely to buy Cogeco. Rogers tried, and failed, to acquire Quebec-based Vidéotron in 2000 — losing out to media conglomerate Quebecor. But Rogers did succeed in picking up Shaw’s Ontario-based Mountain Cablevision, Ltd. last January.

Cogeco has pursued other cable companies outside of Canada in the past. Its acquisition of Portugal’s Cabovisao in 2006 was widely panned, and after Portugal’s economy crashed in the Great Recession, Cogeco ended up writing off its net investment, taking a $56.7 million loss. Cogeco acquired Cabovisao for $660 million and sold it to ALTICE six years later for the fire sale price of $59.3 million.

atlanticIn 2012, Cogeco acquired rural and small city cable operator Atlantic Broadband for $1.36 billion. Atlantic offers service in Pennsylvania, Florida, Maryland, Delaware, and South Carolina — mostly in communities ignored by Comcast and Time Warner Cable.

Possible Cogeco acquisition targets include Cable ONE, WOW!, Wave Broadband, SureWest/Consolidated Communications, Midcontinent Communications, Buckeye Cable, and/or Blue Ridge Communications, to name a few.

In the meantime, Cogeco is following the lead of U.S. cable operators by intensifying service expansion in commercial areas, particularly industrial parks and office complexes. Selling larger businesses cable broadband could net Cogeco $600-1,200 a month per account.

Cogeco Asks New Tenant to Cover Old Renter’s $1,500 Cable Bill Before Connecting Service

Phillip Dampier February 28, 2013 Canada, Cogeco, Consumer News Comments Off on Cogeco Asks New Tenant to Cover Old Renter’s $1,500 Cable Bill Before Connecting Service
Cogeco red-flags addresses where its deadbeat customers live.

Cogeco red-flags addresses where its deadbeat customers live.

An Ontario cable company is refusing to hook up service for a new renter until the former tenant’s $1,500 past due balance is paid in full.

Cogeco Cable told its would-be customer it could not install his broadband, phone, and cable-TV service, even though the renter offered to provide a letter from his landlord asserting he had no relationship to the earlier tenant.

The cable operator’s “skip” policy, which flags accounts disconnected for non-payment, can make life difficult for the new renter or property owner. Cogeco’s policy is designed to stop disconnected customers from restarting service under someone else’s name.

In some cases, Cogeco has reportedly even disclosed personal details about the owner of the past due account, along with a detailed breakdown of the services and charges they incurred.

Customers who have encountered a red flag from Cogeco when attempting to sign up for service have been asked for a notarized letter, preferably from a personal attorney, disavowing any relationship to the former account-holder, along with copies of property transfer documents.

A Cogeco representative tells Stop the Cap! the potential customer was misinformed. Cogeco will not hold a new customer accountable for another customer’s past due balance.

Customers who encounter problems because of “flagged” accounts or addresses should ask to speak to a supervisor. Some supporting documentation may be required in some instances. But usually the supervisor can approve the order and help the customer set up service over the phone.

Cogeco Boosts Speeds, Monthly Usage Allowances for Customers in Québec

Phillip Dampier February 11, 2013 Broadband Speed, Canada, Cogeco, Data Caps 3 Comments

cogecoCogeco customers in Québec will find faster speeds and a larger usage allowance for most of the company’s broadband packages.

The changes took effect Feb. 1. Customers can get the new speeds by briefly unplugging their cable modem, resetting it.

  • Express 5 now offers 5/1.5Mbps service with a 25GB monthly cap;
  • Express 10 now offers 10/1.5Mbps service with a 60GB monthly cap;
  • Turbo 14 now offers 14/2Mbps service with a 80GB monthly cap;
  • Turbo 20 now offers 20/2Mbps service with a 100GB monthly cap;
  • Ultimate 60 now offers 60/2Mbps service with a 300GB monthly cap.

“Internet needs are rapidly evolving,” said Ron Perrotta, vice president of marketing and strategic planning at Cogeco Cable. “We have taken into consideration the feedback received from our current residential customer base, and made the necessary changes in order to meet the needs of the vast majority of our customers and provide them with more competitive internet offerings.”

If Cogeco surveyed their customers regarding getting rid of usage caps altogether, the answer would likely be yes. But that is a question Cogeco does not seem willing to ask.

Cogeco offers different plans for customers in Ontario:

cogeco plans

Canada’s Cogeco Cable Buying Atlantic Broadband in USA

Montreal-based Cogeco Cable has announced it is acquiring Atlantic Broadband, a cable operator serving small communities in Pennsylvania, Florida, Maryland, Delaware and South Carolina for $1.36 billion, raising investor fears the company is once again on a spending spree.

Cogeco’s tarnished record of cable acquisitions was highlighted last year when it was forced to write off almost $250 million in losses racked up by its Portuguese acquistion Cabovisao. The company finally sold the money-losing operation at a loss in February.

Cogeco stock plummeted more than 17 percent on today’s news, and investors are concerned Cogeco’s entry into the U.S. market is competitively risky.

Atlantic Broadband’s cable systems were acquired from Charter Communications in 2003. Charter was consolidating its operations into larger markets, and the systems along the eastern seaboard were deemed too small to create the kind of large, regional clusters cable operators prefer today. Atlantic only serves around 252,000 customers nationwide, almost all in smaller communities and cities. That mirrors the way Cogeco operates in Ontario and Quebec — primarily in smaller cities bypassed by larger operators Rogers Cable and Vidéotron.

Cogeco CEO Louis Audet believes growth opportunities in Canada are limited at best. He defended the acquisition as an entry point in the United States, signaling Cogeco was going to continue shopping for other small U.S. cable operators.

Cogeco is paying about $5,400 per subscriber, according to Bloomberg News. That compares with $4,418 Time Warner Cable paid per subscriber for Insight Communications, and $5,486 for each Knology customer acquired by WideOpenWest LLC.

Cogeco acquired Atlantic Broadband from private-equity firms Abry Partners and Oak Hill Capital Partners.

Cogeco’s ‘Value Plan’ Doesn’t Offer Much Value: $19.95 for 4Mbps With 15GB Cap

Cogeco Cable is mailing flyers to residents in eastern Canada promoting the company’s ‘value’ option:

  • 4Mbps download speed
  • 12 Month Contract with $75 early termination fee
  • Increases to $32.95/mo off contract
  • “Generous” 15GB usage cap with $1.50/GB overlimit fee (maximum penalty: $50)

Cogeco calls this plan ideal “for anyone who uses the Internet to exchange emails with friends, search sites and download pictures.”

In other words, it’s barely broadband for those who barely use the Internet.

Many Ontario and Quebec phone companies can offer even faster speeds through traditional DSL service. In Bell Fibe areas, for $6 more a month, customers can get a 15/10Mbps package for $26.97/mo for six months, which includes a safer 75GB allowance. At the end of six months, threaten to walk and Bell will extend the offer an extra six months.

Customers bundling services with either Bell or Cogeco may be able to negotiate for a package with better speeds and a more generous allowance. While Cogeco has cracked down on promotions, Bell has not, so customers served by Cogeco are advised to ask about all available deals before committing to either provider.

 

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