Quebecor hits wireless speed bump in first quarter

It's been a tough week for cable companies trying to do something in wireless. First Cox Communications said it would abandon its own 3G networks and become a Sprint (NYSE: S) MVNO and now Quebecor, the media conglomerate owner of Canadian MSO Videotron, said that its first quarter profit was below analyst expectations because if had to pay for its new wireless operation.

That was the down side of wireless. The upside, according to the company, is that it added 28,600 wireless customers while it was losing 3,000 basic cable subscribers. Reflecting trends throughout North America, Videotron did add 24,100 digital TV users, 11,500 Internet customers and 15,500 digital hone customers in the quarter. It earned net income of $34.3 million Canadian compared to $34.9 million Canadian a year ago. Revenues of $990.5 million Canadian, up 45 percent year-over-year, fell below analyst expectations of $1 billion Canadian.

In the end, though, it was wireless business that was to blame. "The rollout of Videotron's new mobile services network negatively impacted net income in the first quarter," Pierre Carl Peladeau, Quebecor's CEO, said.

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