Invest in BCE

George A. Cope letter to shareholders

Hello everyone, 2012 was a year of substantial progress for Bell. Our strategy of investment in world-class mobile and fibre networks, and the efficient delivery of next-generation services across them to consumer and business customers, supported strong operational and financial performance.       Our move forward is built on the Bell team’s dedicated execution of the 6 Strategic Imperatives that enable us to achieve a clear goal: For Bell to be recognized by customers as Canada’s leading communications company. 2012 was a year of substantial progress for Bell. Our strategy of investment in world-class mobile and fibre networks, and the efficient delivery of next-generation services across them to consumer and business customers, supported strong operational and financial performance.      Our move forward is built on the Bell team’s dedicated execution of the 6 Strategic Imperatives that enable us to achieve a clear goal: For Bell to be recognized by customers as Canada’s leading communications company.

Bell’s 6 Strategic Imperatives

1. Accelerate wireless
2. Leverage wireline momentum
3. Expand media leadership
4. Invest in broadband networks and services
5. Achieve a competitive cost structure
6. Improve customer service

Bell is a re-energized competitor focused on growth and broadband innovation. As we’ve transformed, Bell has delivered new choices to consumers and stimulated competition across the Canadian communications landscape:

• We are building world-leading broadband infrastructure, including extensive new fibre rollouts supporting our superior Fibe TV and Fibe Internet products, and world-leading LTE wireless technology that gives Bell customers access to the largest mobile 4G network in the country.
• Data hosting and cloud computing services are key to business communications in the new information age, and Bell has invested extensively in data centre capacity – including our strategic alliance with Q9 Networks. As Canada’s leading B2B provider, Bell enables business in the cloud with Canada’s largest data centre footprint and supporting broadband connectivity.
• Now available to more than 3.3 million households in Québec and Ontario, Bell Fibe TV has quickly become a preferred television option as we grew our Fibe TV subscriber base by 187% year over year. Offering a superior viewing and interactive online experience, Fibe has brought real choice and competition to television and Internet markets once dominated by cable.
• LTE is driving fast growth in smartphones and data services, like the unique Bell Mobile TV service. Bell has the best networks, superphones, services and distribution, and wireless customers clearly like our approach – Bell achieved industry-leading postpaid net additions (40% of incumbent market share), ARPU and EBITDA growth in 2012.
• Customer satisfaction is growing thanks to intense investment in service teams, tools and training. Our customer support now rivals the best in the industry, and we look forward to taking it further in 2013.
• Bell Media is driving innovation in delivering top-tier Canadian and international media to viewers and listeners across all platforms and all service providers. Our plan to welcome the team at Montréal’s Astral Media, and our investments in Maple Leaf Sports and Entertainment (MLSE) and the Montréal Canadiens, support our commitment to deliver the best news, sports and entertainment content to every screen.
• As growth services continue to accelerate, Bell is effectively managing our legacy wireline voice services. Bolstered by Fibe TV and Internet bundling that reduced Home Phone decline year over year, and more than $166 million in wireline operating cost reductions, Bell had the industry’s highest reported wireline EBITDA margin in 2012.

Bell’s strong financial position and tremendous momentum in the marketplace are delivering industry-leading value for shareholders, with 9 common share dividend increases since the end of 2008. Positioned for continued growth in 2013, Bell looks forward to further enhancing competition, innovation and choice in the communications marketplace.

Our community investment is as focused as our business strategy, and Bell is proud of the extraordinary progress we’ve made with Bell Let’s Talk. Addressing a health concern with a profound impact on both personal lives and our national economy, Bell Let’s Talk is lifting the stigma around mental illness and bringing unprecedented support to care and access, research, and workplace initiatives.

Your Bell team is committed to achieving our goal as we continue to deliver value to you, the shareholders who have supported this company’s remarkable move forward. Today, like every day, Bell just got better.