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Record Customer Base Growth in all Lines of Business: Videotron Extended its Lead in 2005.

MONTREAL -- Videotron today released its customer numbers as of December 31, 2005. The Quebec-based telecom provider registered strong growth in all service segments: cable television, Internet access and residential telephone service.

Videotron's total customer base broke through the 1.5 million mark in 2005, rising to 1,506,000, compared with 1,452,500 in 2004 and 1,424,000 in 2003. It was by far the largest increase in the last five years. The breakdown indicates a substantial increase in subscriptions to multi-product packages and an ongoing migration from analog to digital TV.

Successful move into residential telephone service

Videotron is now the leading provider of Internet Protocol-based telephone service in Canada. After less than 12 months, the number of subscribers to its cable telephone service stands at nearly 163,000. Subscriptions to Videotron's new alternative to conventional telephone service grew steadily throughout 2005. After launching its telephone service in Montreal South Shore and Laval in the first quarter of 2005, Videotron rolled out the product on the West Island (May 25), the Quebec City area (July 11), where consumer response was particularly enthusiastic, and the rest of the Island of Montreal (August 17). Videotron began phasing in the service in Montreal North Shore on November 24.

"Our new cable telephone service has been an instant hit since we introduced it at the beginning of 2005," said Robert Depatie, President and Chief Executive Officer of Videotron. "We are particularly pleased by the high level of customer satisfaction. The message from the marketplace is clear: large numbers of consumers were eagerly awaiting a reliable alternative to conventional telephone service. However, it must be borne in mind that our move into residential telephone service has opened only a small breach in a market still heavily dominated by one player."

In addition to the highly successful roll-out of cable telephone service, Videotron recorded exceptional growth in subscriptions to its digital cable television and cable Internet access services in 2005.

illico Digital TV: freedom of choice, interactivity, exclusive content

The customer base for Videotron's illico Digital TV service increased by 42% in just one year and has nearly doubled in two years, closing the year at 475,000, compared with 333,664 at the end of 2004 and 240,863 at the end of 2003.

Videotron's Video on Demand (VoD) service, offered exclusively to all subscribers to illico Digital TV, in collaboration with Archambault Group, was an important factor in illico's growth. The service logged more than 10 million orders (paid and free) in 2005. Videotron is still the only VoD provider in its service area. Customers can choose from a catalogue of more than 1,000 titles, including movies, television programs and documentaries.

In 2005, Videotron became the first major telecom provider in Canada to premiere a high-calibre television series (Nos Etes 2) on VoD before its network broadcast to the general public. Videotron is also the first major cable carrier in Canada to offer films from the prestigious Warner Bros. Entertainment studio on VoD.

Videotron's unique a la carte channel selection option lets customers pick and choose among a vast array of television services. In 2005, Videotron added several popular channels to its line-up, including RAI Internationale, the international service of Italy's largest television network. The long-awaited launch was greeted with enthusiasm by subscribers.

Internet: faster and faster

Internet penetration in Quebec continued to progress and Videotron strengthened its position as the uncontested leader in high-speed Internet access with more than 656,000 subscribers to its cable and dial-up access services, an increase of 130,000 from the end of 2004 and of 220,000 from the end of 2003.

Videotron's positioning as "the fastest, period" will continue to hold in 2006 as the speed of its Basic Internet service is boosted from 300 to 600 Kbps in January.

A series of Quebec firsts on Videotron's High-Speed Zone

The popularity of interactive games is booming and continued growth is expected in the segment. In May 2005, Videotron and Reeves Interactive announced the launch of Microplay Online(TM), Quebec's first French-language networked multiplayer gaming service.

In June 2005, for the first time in Quebec, a major boxing bout was carried live on the Internet, exclusively on Videotron's High-Speed Zone. In the course of the year, Videotron served up a number of surprises and exclusive offerings on its High-Speed Zone for its High-Speed Internet customers, including Star Academie 2005, Celine Dion, Isabelle Boulay, Ariane Moffatt, Nickelback, Les Trois accords, Simple Plan, Loco Locass and Oliver Jones.

Videotron scored a string of key successes in 2005: a series of premieres and exclusive offerings on cable and the Internet, the successful launch of its residential telephone service via cable, the launch of a major network modernization plan in the Quebec City area and other regions, and new multi-year collective agreements with its unionized employees.

"Delivering the best possible customer experience will remain our top priority at Videotron in 2006," said Mr. Depatie.

Videotron ltee (, a wholly owned subsidiary of Quebecor Media Inc., is an integrated communications company engaged in cable television, interactive multimedia development, Internet access services and residential telephone service. Videotron is a leader in new technologies with its illico interactive television system and its broadband network, which supports high-speed cable Internet access, analog and digital cable television, and other services. As of December 31, 2005, Videotron was serving 1,506,000 cable television customers in Quebec; including over 475,000 illico subscribers. Videotron is also the Quebec leader in high-speed Internet access, with 656,000 subscribers to its cable modem and dial-up services. In addition, Videotron provides residential telephone service to 163,000 customers in Montreal, Montreal South Shore and North Shore, Laval and the Quebec City area.

Videotron Ltee (TSX:QBR.MV.A) (TSX:QBR.SV.B)
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Publication:Business Wire
Geographic Code:1CANA
Date:Jan 5, 2006
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