Canadian Industrial Outlook: Telecommunications—Autumn 2018

Investment in 5G—New technical specifications that will define 5G globally were released earlier this year, providing clarity to telecom companies and spurring the launch of 5G networks south of the border. With Canada poised to follow suit in the next few years, large investments will be needed in the sector.

Accelerated Investment Initiative—The federal government recently announced changes to the tax code to allow firms to accelerate depreciation of new assets for a limited period of time. While benefiting all sectors of the economy, the changes are especially good news for telecommunication firms, which must invest heavily to launch 5G networks in Canada. These measures will provide more financial flexibility to do so.

Consumers—With consumer spending expected to decelerate amid slower job growth and wage gains, household spending on discretionary telecommunication services is unlikely to improve.