Telus 2006 Annual Report Download - page 29

services. In addition, both Bell Mobility and Rogers Communications are supporting other
MVNO partnerships with cable-TV companies such as Videotron and Eastlink, and other
resellers, such as President’s Choice, Petro-Canada and 7-Eleven. In the price-sensitive
market, Bell and Rogers are promoting their respective discount brand offerings to compete
against the MVNOs and TELUS. In 2006, TELUS signed an agreement with Amp’d Mobile, a
specialized provider of wireless multimedia services to target the young adult market with
services beginning in 2007. Competition within the wireless market is anticipated to remain
intense. There is a risk that the auction processes for AWS or a future auction of 2.5 GHz
spectrum could lead to additional wireless providers or increased entry on a regional basis.
TELUS also competes with numerous national, regional and local-paging companies for paging
customers in Alberta, B.C., and eastern Québec. TELUS offers a number of wireless Internet
offerings using the networks noted above as well as wireless LAN services such as WiFi
(802.11) in so-called “hotspots” and other areas utilizing unlicenced spectrum. In offering
wireless Internet and LAN access service, TELUS competes, to a limited extent, with wireline
business Internet access providers. It also competes with major equipment manufacturers for
private radio engineered systems.
Other emerging competitive services
Over the longer term there are a number of factors that are expected to increase competition in
the communications industry. Of note is the competitive escalation resulting from the continuing
convergence of cable-TV, satellite, computer, wireline and wireless technologies. In November
2005, TELUS commercially launched TELUS TV within select neighbourhoods in the Edmonton
and Calgary markets. In 2006, the expansion continued with a targeted commercial launch in
Vancouver, and there are plans underway to launch it in other major centres within its ILEC
territories. In this segment, TELUS competes with established cable-TV video providers Shaw
Communications and Cogeco, and with direct-to-home broadcast satellite companies, Bell
ExpressVu and Star Choice.
Competition is also intense in other areas as TELUS continues its growth into emerging markets
such as Web hosting and application services and human resource process outsourcing.
DIVIDENDS DECLARED
The dividends per Common Share and Non-Voting Share declared with respect to each quarter
by TELUS, during the three-year period ended December 31, 2006, are shown below.
Quarter ended (1) 2006 2005 2004
March 31 $0.275 $0.20 $0.15
June 30 $0.275 $0.20 $0.15
September 30 $0.275 $0.20 $0.15
December 31 $0.375 $0.275 $0.20
(1) Paid on the first business day of the next month.
TELUS’ Board of Directors reviews its dividend rate quarterly. On November 3, 2006, TELUS
announced that it was increasing its dividend to $0.375 per share on the issued and outstanding
Common and Non-Voting Shares. This 36 per cent increase was consistent with the Company’s
forward-looking dividend payout ratio guideline of 45 to 55 per cent of sustainable net earnings
first set in October 2004. TELUS’ quarterly dividend rate will depend on an ongoing assessment of
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