Look Communications on track to begin growing TV subscriber base again, CEO says

Wireless cable operator Look Communications Inc. is on track to begin growing its digital TV subscriber base again after nearly two years of subscriber losses, according to the company’s president and CEO. Paul Lamontagne says a new advertising campaign for its TV offering launched in mid-September has produced "extremely positive results" to date and he’s confident the momentum will continue. During a recent stop in Ottawa to officially launch Look’s high-speed Internet offering in the region, Canadian Communications Reports asked Lamontagne how the company was fairing with its goal to reverse customer losses in the second half of the year. "It’s extremely positive," he responded in an interview. "We have reported four consecutive quarters of operating profits, which is our measure of success. And we were keenly focused coming out of our reorganization (after it filed for bankruptcy protection) on remaining EBITDA positive going forward." He declined to comment on most recent customer numbers until Look’s third quarter financial results are officially released. "In the second half of the year, we said we would start growing our business again. And we’re extremely optimistic that by the end of the year, we will have started to grow again," Lamontagne said. "In the middle of September, we launched a new digital television (advertising) campaign, which has had extremely positive results to date. We are pleased with our early results." He added that Look mailed out four million direct mail pieces outlining Look services to people in Ontario and Quebec. And he noted that Look has just introduced a new Internet/TV bundle and other initiatives aimed at enabling it to reach its year-end goal. "In the early days, we did mass advertising (including to customers who were expensive to acquire)," Lamontagne noted. "When we do our marketing today, we’re very target-specific in the areas that we go after to ensure that we lower our costs of installation." Continuing its re-launch strategy, Look recently launched its Look UltraFast wireless high-speed Internet access service for small- and medium-sized businesses into the Ottawa area. The expansion means that Look’s high-speed services – 750 kbps and 1.5 Mbps – are now available to about 250,000 SMEs in six cities. The expansion along with the acquisition of new Internet and digital TV customers puts the company on track for sustained future growth, Lamontagne said. "With our expansion into the Ottawa Valley/Outaouais markets, we continue the execution of our new strategy to be the preferred alternative provider of broadband services to the SME market," he said. "We set out this year with a plan of actually rolling out into five cities, but we’re already at six. So we’re in more markets than we thought we’d be. And we’re currently looking at rolling out either at the end of this year or early next in more communities that are underserved." While the profit margins on the Internet offering are higher, Lamontagne said the company is also focused on expanding the customer base for its wireless digital TV service. "There is huge demand out in the marketplace still for digital television distribution services," he said. "I think those consumers are extremely price sensitive and they are shopping around, and the Look offering is a very interesting offer – not only for our service but also for our equipment." Look charges $149.95 for the first digital box for households (the cost is different for multiple-unit dwellings) and $50 for the second and third, with only one monthly service charge for all three outlets. A package of close to 130 channels costs $30.95 a month. Lamontagne notes that the company purposely held off on adding new digital specialty channels to its TV offering. "We made a conscious decision to defer the launch to see what the reaction would be," he said. In the Ottawa market, for example, Look ended up adding three digital services – Showcase Action, Biography Channel and National Geographic Canada – within the Look Wow pack, while in southern Ontario it included those three channels plus Deja View and Leafs TV. Video compression technologies will enable Look to launch more digital channels in the first part of next year, Lamontagne noted, saying an examination of customer reaction to the existing channels is underway. Unlike large cable operators, wireless cablecos such as Look are not required to carry all Category 1 channels because of channel capacity constraints due to the overall limited spectrum that they have been allocated. But Lamontagne believes Look is not overly restricted by spectrum constraints that limit the number of TV channels it can offer. "We have an extremely competitive digital TV offering…Initially customers said to us, what we want is choice, and Look probably offered the most amount of choice. But today, our market surveys tell us that they want a lot for a little. So we’ve come out with Look Plus packages that are very simple for consumers but attractive because of the interesting price," he said. "We have a network that covers today four million households – apartments and homes (in Ontario and Quebec). We deliver a full suite of broadcast services. We believe that we have the best digital service offering in the market," he said. "We’ve only recently re-launched so we’re seeing an increase in the demand for digital television services, and we’re seeing excellent response to our offering in the market." Like other broadcast distributors (CCR, Oct. 24/02), Look is focused on customer retention. "How do you retain a customer? You retain them by providing them with a quality offering at a very good price, and provide top-quality service. The number one priority of our company is customer service," he said. "The underlining objectives that we set for ourselves when we were re-launching were best service, best network, best solutions and best employers."

Look Communications on track to begin growing TV subscriber base again, CEO says

Broadcast | November 7, 2002

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