TMXmoneyTMXmoney - invest with insight

Rogers CEO apologizing for major wireless outage, customers to receive credit

The Canadian Press

Rogers Communications CEO Nadir Mohamed speaks at the company's annual general meeting in Toronto on April 23, 2013. Mohamed has apologized to customers across the country for an "unacceptable" breakdown that knocked out part of the company's wireless network for several hours on Wednesday. THE CANADIAN PRESS/Matthew Sherwood
Rogers Communications CEO Nadir Mohamed speaks at the company's annual general meeting in Toronto on April 23, 2013. Mohamed has apologized to customers across the country for an "unacceptable" breakdown that knocked out part of the company's wireless network for several hours on Wednesday. THE CANADIAN PRESS/Matthew Sherwood

TORONTO - Rogers Communications CEO Nadir Mohamed has apologized to customers across the country for an "unacceptable" breakdown that knocked out part of the company's wireless network for several hours on Wednesday.

Mohamed said technicians had worked as quickly as possible to restore service and that the company (TSX:RCI.B) was continuing to investigate the cause of the outage, which provoked a torrent of negative customer reaction on social media networks.

The telecom giant, which has some 10 million customers across Canada, restored its wireless voice and text messaging services late Wednesday night.

Rogers said its data services did not appear to be affected by the outage.

"I sincerely apologize to all of our customers for this significant inconvenience and appreciate their understanding and patience," Mohamed said in a statement early Thursday.

Rogers and Fido postpaid wireless customers, those on a contract and who pay monthly, will receive a credit on their bills for one day of service because of the outage, the company said.

Marketing expert Raymond Pirouz said Rogers' reputation will take a hit due to the outage.

"Ultimately, the Rogers brand will deteriorate in the mind of the consumer," said Pirouz, who lectures at the Ivey School of Business at Western University in London, Ont.

"But when the consumer has little choice to make a move, the situation becomes a sad state of affairs," he said. "If Verizon had come to Canada, Rogers would have paid better attention to its infrastructure and any additional expenditures related to resolving or upgrading whatever is causing the situation."

Telecom analyst Troy Crandall said a lot of Canadians under 40 don't have landline telephones and were inconvenienced, but added the quick apology by Mohamed was a "smart move."

Crandall said he didn't expect the outage to have any effect on Roger's earnings.

"It's just a little tiny hiccup in a long story for Rogers," said Crandall, of investment firm MacDougall, MacDougall and Mactier in Montreal.