SaskTel loses $8.2M on phone-book foray
Last Updated: Saturday, November 7, 2009 | 8:42 AM CT
CBC News
SaskTel, the province's telecommunications company, is turning the page on a money-losing phone-book venture
The Crown corporation announced Thursday that it has completed the sale of its out-of-province directory business, known as DirectWest Canada.
SaskTel said that after losing $8.2 million on the venture, it will stick to publishing phone books just in Saskatchewan.
The company's foray into Alberta and Manitoba began in 2005. At the time, SaskTel said the move was necessary because of increased competition from online telephone directories.
However, in its most recent annual report, covering 2008, SaskTel noted DirectWest Canada was losing money: $3.3 million in 2007 and $2 million in 2008.
Before expanding outside of Saskatchewan, the phone-book business was regularly generating about $1.6 million for SaskTel's bottom line.
In its 2002 annual report, the company said that particular part of the phone business was facing challenges.
"DirectWest's … core directory business is a mature business for which minimal growth is projected," the company said. "[B]ig box stores are impacting local retail outlets which are DirectWest's prime customers."
Despite that assessment, and the losses in Alberta and Manitoba, the company said Thursday that the outlook for DirectWest was rosy.
"Our core Saskatchewan market continues to experience significant growth," Robert Watson, the president and CEO of SaskTel, said in a news release.
The company did not provide current employment figures, but in previous annual reports it said there were 108 Saskatchewan employees in the publishing division and another 60 out-of-province staff.
Thursday's news release said no Saskatchewan jobs would be lost because of the sale. The release was silent about staff outside the province.
The company said the final sale of phone-book assets went to a Winnipeg-based publishing enterprise called Lester Communications. Lester Communications paid $31,732 in the deal.
