Thank you for standing by. This is the conference operator. Welcome to the Rogers Communications Inc. Third Quarter 2023 Results Conference Call. As a remainder, all participants are in a listen-only mode. And the conference is being recorded. [Operator Instructions]. I would now like to turn the conference over to Paul Carpino, Vice President of Investor Relations with Rogers Communications. Please go ahead, Mr. Carpino.

Great. Thank you, Ariel, and good morning, everyone, and thank you for joining us. Today, I am here with President and Chief Executive Officer, Tony Staffieri; and our Chief Financial Officer, Glenn Brandt. Today's discussion will include estimates and other forward-looking information from which our actual results could differ. Please review the cautionary language in today's earnings report and in the 2022 annual report regarding the various factors, assumptions and risks that could cause our actual results to differ. With that, let me turn it over to Tony to begin.

Thank you, Paul, and good morning, everyone. I'm very pleased to report that we delivered industry-leading results in the third quarter, our seventh consecutive quarter of growth and momentum. We also made substantive progress on integration and we are now tracking six months ahead of our synergy targets and deleveraging plans. Our team is clearly firing on all cylinders, executing with discipline, and delivering on our commitments. Turning to results, we grew total service revenue by 40% and adjusted EBITDA by 52% in the third quarter. Our consolidated adjusted margin performance of more than 47% is 340 basis points higher than our competitor BCE, and almost a thousand basis points higher than TELUS. We are clearly delivering through a consistent strategy that focuses on the quality of our assets, operational efficiency, and discipline execution. In wireless, we delivered industry leading financial and operating results. We attracted 261,000 mobile phone net editions of 40,000 from a year ago. This reflects the best combined postpaid and prepaid loading in our company's history. This phone only loading represents 94,000 more than BCE and over a hundred thousand more than TELUS. We did this while growing ARPU. Simply put, we continue to out execute our peers and have done so consistently for the last two years. We also delivered impressive financial results in the quarter. Wireless service revenue was up 15%. Adjusted EBITDA was up 18% and wireless blended ARPU up 4%. It's clear, Canadians are choosing Rogers more than any of our competitors. In cable, we saw market share gains accelerate across the east and the west. These gains are driven by our new bundled offers, our network investments, and our 5G leadership. In the quarter, we added 18,000 internet customers. While we need to grow revenue, we've turned the corner on subscriber…

Thanks Tony, and good morning, everyone. Thank you for joining us today. Roger's third quarter results reflect strong, disciplined execution, driving growth, and accelerated delivering of the balance sheet. Six months into coming together with Shaw, we are doing what we said we would do. We have grown consolidated EBITDA by 52%, roughly six months ahead of schedule. In wireless, our third quarter service revenue was up 15% reflecting strong execution and healthy underlying organic growth. Excluding the $91 million customer credits from last year, wireless service revenue growth was up 9%. Postpaid mobile phone customer net ads in the quarter were 225,000. Our strongest postpaid mobile phone loading on record and an impressive 37% increase year-over-year. Coupled with our positive prepaid loading, total mobile phone net adds this quarter was 261,000, up 40,000 year-over-year and the strongest loading ever by a Canadian wireless company. We have welcomed approximately 0.5 million new postpaid mobile subscribers to our network year-to-date, reflecting 64% more subscribers than our next closest rival, all while delivering growing EBITDA and ARPU. Our leadership in wireless is clear. We have consistently led our peers in wireless loading for two years now with Canadians choosing Rogers Wireless more than any other carrier. Wireless ARPU for the quarter was $58.83, which is up 4% year-over-year. The 4% increase reflects the prior year's $91 million in customer credits, which in turn was partially offset by the absorption of the Shaw mobile customers in this period. After adjusting for the integration of the Shaw mobile customers, combined with removing the prior year's $91 million customer credits change, ARPU was once more up slightly year-over-year. And we expect this momentum to continue. Postpaid mobile churn in the quarter was 1.08%, up slightly year-over-year, reflecting a competitive market. Wireless adjusted EBITDA was up…

[Operator Instructions]. Our first question comes from Drew McReynolds of RBC. Please go ahead.

Thanks, so much to dive into very good results obviously. So, I'll just limit myself to kind of two areas here. So first, just with respect to the synergy realization and obviously being well ahead, so great to see, Glenn, can you give us any sense of with our -- obviously giving guidance I am presuming, the cadence of kind of what you expect on the synergy realization as we go through 2024, and milestones that investors should be kind of looking for there. And if, you are able to potentially do more than a $1 billion as I think some have speculated. And then the second area, just on the Wireless momentum, an unbelievable Q3 for sure. As you look into Q4, what are you seeing so far in the quarter in terms of the environment and what would be your expectation as we play the quarter out? Thank you.

Thank you, Drew. On the synergy target, we are still targeting the $1 billion. I am not going to start targeting a larger number. And I think once we have worked through those targets to get to the $1 billion, the exercise then simply turns to, when and we will turn through that to really what's our year-over-year growth, rather than trying to continue to do the accounting on where would our costs be without Shaw. As we move forward, that exercise becomes more and more difficult to try and unspin. And so, we are still focused on driving the $1 billion synergy cost reductions. The progress to-date has very largely been on the departmental and employee integration, we have essentially or largely, very largely completed that part of the synergy exercise, well ahead of schedule. We were first expecting that to run into 2024. That is largely complete as we have closed out the third quarter. And so that's most of the gains that we have made to-date. We are though also bringing in synergies from some of the vendor contract negotiations and rationalizations or combinations. The two largest buckets then remaining are for the third-party vendors, just a general category as well as media content costs. And we are leaning in on those. And I expect that those will come to plan at least on pace, if not, also being maybe a little bit ahead. But we have synergy costs well in hand. We will be at a $600 million run rate as we close the year. And Tony, on the Wireless side?

Drew, with respect to second part of your question, a couple of comments. One, I would say the macro environment for Wireless continues to look strong. We exited Q2 as an industry with growth in Wireless subscribers of over 5%, and we continued to perform well in terms of market share on that backdrop. The growth in the industry of course, better penetration rates, but importantly, the continued growth in the new to Canada category continues to seem strong, even as we exit the third quarter and into October, November now. That category continues to grow, and we do well in terms of market share in that category. And so, from a broad environment, we continue to see good health in the market, as we went through back-to-school, as you would expect, competitive intensity picked up, and really pleased with the way we executed in that competitive environment to look at value propositions beyond price, and utilize our industry-leading channels, particularly in retail to execute strong market share performance. And as we exited Q3 and are now into and approaching Black Friday, we continue to see good healthy competition. And our execution in that backdrop continues to do well. So, continued strong environment and performance in wireless for Q4.

Our next question comes from Sebastiano Petti of JP Morgan. Please go ahead.

Hi, thank you. Just wanted to unpack while you're guiding to the higher end of the free cash flow range EBITDA being unchanged seems a little bit conservative, particularly in light of the higher expectation for synergy realization in the quarter or in 4Q and exiting the year. Anything to unpack there? Is that just a bit of conservatism related to just the overall operating environment and maybe some, or is it perhaps investments related to Shaw? And then relatedly, second question on the cable revenue side, a good color on Alberta and DC revenue trends. And Tony, I think you said overall strategy or expectation goal is to drive revenue growth in cable, but how does the east compare perhaps to what you're seeing in the West? And maybe help us think about some of the levers you can pull to get to or reinvigorate the cable growth revenue side. Thank you.

Sorry, Sebastiano, on the free cash flow guidance, we'll come in at the mid to high end. We're not -- I'm not dampening that at all. We're on a fairly flat run rate or constant run rate in terms of our CapEx through the year. The EBITDA guidance we raised earlier in the year in terms of the tightened, the range. And I think if you roll those through, we'll be in the mid to higher range higher end of that guidance range on free cash flow, I'm satisfied with that at somewhere in the range of $2.4 billion or $2.5 billion of free cash flow. That is plenty of leeway for us to work on our delivering plans. And so, I'm satisfied with that progress and pleased with where we've come out on that.

Sebastiano, on the second part of your question cable revenue, I'll start with it really comes down to the fundamentals. And with the coming together of Shaw, we took the opportunity to reset our value proposition. So as much more consistent across the entire footprint of Rogers together with Shaw. And so, what you see is us leveraging what has always been our competitive advantage on internet with leading speeds and reliability across the entire footprint. So that we could offer at a minimum one and a half gigs of speed. And that's always done well for us. We've then combined that with a repackaging of the video product to make it much simpler and a real value add for customers, which has started to resonate. Well, it's early days, but it started to resonate well, and you see that with the increased video subscribers there as well. As part of that value proposition, we also leaned on looking at everything else that was of value to customers and not just focus on price in various markets. And so, what you see is year-on-year, even after adjusting for last year's credits in the cable business, you see ARPA actually increasing year-on-year. So, you see coming together a good increase in subscriber performance and a good increase in ARPA. And those are really the fundamental ingredients, that we'll continue to push on that in due course we'll see revenue start to climb in cable as well. A couple of things, I would say you were specific about east and west, and I would say what we are seeing is good growth in both of those segments. So really pleased with the way that's going. The bundled offers are also hunting well particularly in the west, which is a new category for us in terms of bundled. And so, we're really pleased with both wireless and cable market share gains that we're seeing in those markets. So, it's a combination of a few fundamentals, combination of focused execution on a market by market basis to ensure that we're getting the share gains that we need to eventually translate that to growth in revenue.

Our next question comes from Vince Valentini of TD Cowen. Please go ahead.

Just maybe clarify on that last point. And then another question is when you're talking about market share gains, Tony. I mean clearly 18,000 internet ads compared to what we saw from Bell and TELUS doesn't look like on an absolute basis. You're gaining market share there, but are you talking more holistically about wireless subs in a bundle as well as standalone internet when about market share?

Yes, two things Vince. Thanks for the opportunity to clarify. One is we do talk about it in terms of a bundle, and the other is given the differing size of footprint, we look at what we're doing with respect to penetration rates of homes past. And so, what we see is contrary to prior quarters where we had a decline in penetration rates, we're starting to see those penetration rates start to improve. So that's how we think about it.

Okay. And the other question I have was just on the non-core asset sales the last quarter I think, or maybe it was the conferences in September, you were seemed reasonably confident there could be some announcements before the end of this calendar year. We're mid-November almost. So just wondering if there's any update on that. You're still confident on that front, Glenn?

Thanks Vince. Yes, we're still working through a process on a few different exercises and still confident on the timeframe of hopefully having announcements in year and closing again, still looking to close if not in year this year, certainly first half of next year for a number of those.

But obviously when you say 4.8 times target for the end of the year for leverage, you're not factoring in any of those assets.

That's correct. It's -- that is just straight from the synergy and organic growth we have in the business and the use of free cash flow.

Thank you.

Thank you, Vince.

Next question, Ariel.

Our next question comes from David Barden of Bank of America Merrill Lynch. Please go ahead.

Hi, guys. Thanks for taking my question. So well done on the loadings this quarter. If one were to critique it, one might say that, some of the pricing actions that you took during the quarter impacted your ability to take share and if one extrapolated from that, one might imagine that pricing in the industry is a little less stable than people would hope, and that in reaction to your very strong loadings in the quarter, it is an inevitability that other competitors are going to have to come back with their own pricing actions. And I was wondering if you could kind of extrapolate a little bit or elaborate a little bit on that dynamic in the Canadian market? And then second, if you could share with us what you think the impact and the import of the new CRTC interim regulations on wholesale pricing for broadband are for Rogers and in the industry generally? Thank you.

Thanks, David. Two parts. So, on the first part of the question with respect to pricing, I am not sure I follow the logic and the that you are looking at. Just to put in perspective, we have been clear in terms of our strategy of focusing our brands and brand evolution on the Rogers brand. And so, what you saw us do earlier in the year is expand the Rogers value propositions to include capped plans, not unlike you see in the U.S, all focused on the Rogers 5G brand. And our competitors, decided to expand their value offering in the flanker brands, different strategy. And, we will follow our strategy and it seems to hunt well in the marketplace. I think we talked about it on the last call. But for clarity, the intent of introducing CAPT plans at the $55 entry point was clearly intended to provide a path for customers on flanker 4G to upgrade to the 5G experience, with a nominal increase in price and ARPU. And so, what you saw is actually, in our opinion, a value creation for the segment and you see that for us, in the organic ARPU side of growth that we have and so albeit it mild, it nonetheless is on the positive side of the growth when you look at the ARPU ledger. And so, we are pleased with that. So, our sense is that, the strategy is working not only for Rogers. But frankly, for the industry, here in Canada. So, we are pleased with the trending that we see on that. And as we look to Q4, and we are about midway through now, we continue to see, again, positive momentum in terms of attracting customers that coming in year-on-year higher in terms of ARPU and…

Our next question comes from Maher Yaghi of Scotiabank. Please go ahead.

Great. Thank you, for taking my question. Good job on the quarter. Congratulations. Looks very strong. I wanted to ask you if you can, maybe just for housekeeping help us understand what was the organic revenue growth and EBITDA growth for both wireless and cable? That would help a lot. Now on the synergy is definitely tracking above and faster than expected. Can I ask you may be, how are you handling the organizational shift? As you said you had a lot of employment, employee changes restructurings departmental changes. How are you making sure that the path and the momentum that you have in the marketplace can continue with these significant changes happening inside the organization? And maybe just one last point on the west. When you look at the market share gains that you talked about in wireless, Tony, what's the path? How much more what's the market potential for you there to keep gaining market share and wireless, and who are you taking the share from in your view? Thank you.

Thank you, Maher. I'll start with your question on the growth rates in wireless. If I remove the impact of the prior year credits, our pro forma service revenue and EBITDA growth, both would've been up 9%. And in cable, if -- that's also within cable factoring in the prior year credits as well, the pro forma service revenue growth would've been down 3% and the EBITDA growth would've been up 8%. That split obviously reflects the largest part of the, the cost synergies going through cable. Some go through our corporate offices, most of them are going through the cable operations.

In terms of the second part of your question in synergies as we execute through those, mayor. Starts first and foremost, and I've said this in the past, we are extremely pleased with the set of assets and in particular the team that has come together with Shaw, excuse me, in terms of the talent, the commitment, and as I said in my comments, the tenacity of this team and desire to do the right thing for customers, it's just phenomenal. And so, as we come together, we've been focused on a few messages that I'll leave with you. One is let's keep it simple for the customer. Let's keep it simple for us. We have a very clear focus on the things that are going to matter most, and we try not to overload our execution agenda and stay focused on outcomes. And what you see is that coming together in both the west and the east. And so, we're really pleased with the way that's come through. And as I look to our performance in this fourth quarter now that we're midway through we continue to see good continued momentum on the synergy execution. In terms of the question on the West and where we're getting market share from. I would say a couple of things. We're very laser focused on the brands, and as I said on the earlier question, we very much focus on a market by market and segment by segment basis to ensure we've got the right value proposition and the way we carry that through in our channels. In terms of where it comes from, I would say it's coming from first and foremost, the growth in the market, and then secondarily in terms of which competitors are being impacted. I would say it's probably over to them to talk about it now that you've seen all their results. And so, it comes from a number of different areas. We're less fussed about where it's coming from and more focused on what's our relative share performance in total and for each market.

Great. Thank you, very much.

Next question, Ariel.

Our next question comes from Tim Casey of BMO. Please go ahead.

Thanks. Two for me. Glenn, just revisiting the notion of keeping your EBITDA guidance unchanged, but the progress you've made on synergy targets and run rates there. Once again, just are you being conservative about the macro environment or Black Friday promotions? Just curious why you wouldn't bump EBITDA guidance up a bit for Q4 given the progress you've made. And second on the synergy progress. Do you still have any heavy lifting to do in terms of consolidating billing systems and customer support systems? I know there was a lot of work with Oracle that had to be done there. Just curious if that's behind you or if that's still on the come. Thanks.

Sure. Thank you, Tim. On the first one, you can appreciate when we set our guidance, we set a range around expectations for the different categories that go into it. The same is true of synergy. I can be conservative and I can also be optimistic when I set those ranges. And so, I assure you that if you look at the dollars, we had telegraphed that or guided that we would achieve $200 million of cost synergies in year. I'm now guiding over $360 million. It's a significant acceleration and significant progress on a timeline to get to those. But in the consolidated hole where we're running a business that's now essentially at $8.5 billion to $9 billion of EBITDA, a $100 million of progress. It's one in our input range or variables that we use to go into the guidance. And two, relative to the $9 billion, it's a fairly small change. And so, it doesn't cause me to want to bump the EBITDA guidance range. That still applies. We did tighten it. When we came out earlier this year, we tightened the range for the EBITDA growth. We will be in that tighter range and nothing more really to say on that. On your question around the billing or other platforms we have. That project is particularly our enterprise resource planning or ERP program, platform that is underway in terms of consolidating across the two companies. That is progressing well. It is on plan, or on schedule. We have had a couple of modules that we have released. We have a couple more still to come, as we move into and through 2024. And in fact, that will roll into very early 2025 potentially to complete. And that's really reflecting the fact that, it will either end just before or just after, a holiday season next year and you don't do anything with ERP or systems, while you are entering into that key period. And so, on plan with those. Pleased with progress so far. We had an important release just over the past couple of weeks in terms of our financial systems and what have you, it is gone well. And so, I am pleased with the progress there.

Next question, Arya?

Our next question comes from Aravinda Galappatthige of Canaccord. Please go ahead.

Good morning. Thanks for taking my questions and congrats on the quarter for me as well. A question on wireless and then a clarification. On Wireless, obviously very strong loading. We know that historically Rogers is sort of, being quite dominant in terms of new Canadians on immigration. With the focus in that area, even greater than it was at an industry level than in the past, can you maybe talk to how that domains or that higher share has sort of sustained, over the last several quarters when immigration numbers have been going up and driving the volumes? And then secondly, a clarification for Glenn. Thanks for the organic numbers. I just want to clarify the cable EBITDA growth of 8%. That obviously includes most the 140 in synergies. It does kind of back out to perhaps a high single-digit decline in Rogers cable organically. I know you don't get too deep into that. But I just wanted to understand if there was anything there that needs to be highlighted. Thanks.

Aravinda, on the first part of the question, the new to candidate category continues to be strong, as I have said earlier on the call. Our performance and dominant market share in that segment continues to be strong as well. And that's across the country, as you look to those numbers. So, we are pleased with the performance there. I am not going to get into the tactics that we use to get there for competitive reasons. But, overall, pleased on pacing of it and our relative performance in that category.

And then Aravinda on the organic growth within cable, I think, we've said consistently that cable is a work in progress in, in terms of turning around the decline in revenue. And we are on that, and that will obviously help lift, obviously stronger growth in EBITDA as we are successful in turning that around. You're right, a significant part of that 8% is the impact of the cost synergies. That's a strength of our business though. That's now embedded in our business. We'll continue to grow on that as well as continuing to grow as we turn around our revenue. I haven't done the math in terms of whether or not, if I pull out this and pull out that, would it be up or down. The simple truth is we've done some heavy lifting in removing those costs permanently, removing those costs, and you see, notwithstanding what has been a 3% decline in revenue organically, we have had a very substantial 8% growth in EBITDA as we turn revenue around, that's going to be a pretty powerful business case. And I'm looking forward to that.

Our next question comes from Batya Levi of UBS. Please go ahead.

Great. Thank you. A question on CapEx with this year coming in at a bit at the high end of the guidance range, should we assume that's pulling forward some of the spending for next year, or can you provide some general color on CapEx trends for next year? Thank you.

Thank you, for the question. I think that's not pulling anything forward that's carrying on with a current run rate and closing at the year. I think, I'm very broadly rounding now, but I think we've been fairly consistent through the year running at or around a billion dollars a quarter. And so, if we sustain that pace through the fourth quarter, recognizing that there's a holiday period in there and some of that spend tends to slow as we move into the winter months that pace would take you to the upper end of the guidance range. Going forward in 2024, the combined operations we haven't guided yet, but we're not pulling anything forward and we'll come out with our guidance early in year ‘24.

Our next question comes from Stephanie Price of CIBC. Please go ahead.

Hi, good morning. Two from me. First is, you mentioned strength and bundling in the west. Just hoping you can dig a little bit more into what you're seeing in terms of bundling the Western customer base and also how we should think about upside from revenue synergies with Shaw. And then secondly, just on the role of wireless handsets in the Rogers strategy, equipment revenue trends seems to be above ahead of peers here. Just wondering the ability to finance handsets for the help of the Rogers bank card might be supporting the trend.

Just let me unpack that. I'll start with the last part of the question in terms of the longer-term financing under the Rogers credit card, it's early days. And the customer take up and interest in that has been very strong, not surprising. I mean, the value proposition is to amortize the cost of the phone over double the period when it's on the card. So, the total quantum of financing doesn't change. It's just over a longer period of time. And the construct, while there's no contract, the construct is such that the value proposition makes it compelling to be and stay at Roger's customers. And that's the way we've designed that value proposition. And importantly, it dovetails with what we're seeing as the longer life of the mobile devices, consumers, and businesses continue to hang onto the vice longer. And we're seeing that over the last several years as a trend. And so, dovetailing that longer life with a longer amortization period makes a lot of sense. But again, it's early days and we're looking forward to how that's going to play out over the holiday season. In terms of bundling opportunities in the west. Specifically, the coming together with Shaw where you had Shaw customers that were either Shaw Mobile and or Shaw home product customers and Rogers wireless customers. What you we saw is not well, you would expect customers that were already clients of Rogers and Shaw coming together and trying to understand how that coming together into one bill was going to impact them. We got what we expected on that, and that was good. But more importantly, what we're seeing are customers that had one product set but not the other looking to simplify things and bring together their product suite. And so,…

Next question, Ariel.

Our next question comes from Simon Flannery of Morgan Stanley. Please go ahead.

Great. Thank you, very much. Good morning. I want to talk a little bit about CapEx if I could. I think, one of the opportunities you saw in the West was to extend the network to MDUs that had not been connected. Can you just update us on that and just give us a little bit more sense of the timing, where you are on the DOCSIS 4.0 upgrade? What should we expect in ‘24 and beyond to move that to completion? Thanks.

Thank you, Simon. On the capital spend specific to wiring up MDUs in the West, we are -- it is underway. Early days. We are six months in through the third quarter and halfway through the fourth. Those planning schedules are well underway in terms of getting permits and what have you. In some cases, we have started some of that build. In other cases, still to come, but we are about where we would expect to be, and so happy with that.

On the second part of your question, Simon, on the 10G DOCSIS 4.0 roadmap, where we are at on that. We are, as you would expect, fast follow, extremely fast follow relative to where, our U.S. cable peers are. And so, the work with respect to mid and high-split, not to get through technical is well underway. And our expectation is that, the bigger lift on that is in the East. And that work is progressing nicely in terms of it. And so, as we look to the CPE and the chipset availability, we will have that much along the same timelines that you are hearing from, the U.S. cable operators. So, look to the back half of '24 as the beginning of what you will see in terms of customer experience improvements.

Thanks, Simon. Ariel, we have time to put in two more questions, please.

Certainly. Our next question comes from Jerome Dubreuil of Desjardins. Please go ahead.

Good morning. You have been great to provide details on synergies. But it is not been really easy to figure out on top of what exactly we should put the $1 billion. So, I know it is not the kind of questions management teams like. But, given the forecast that we see out there, do you think it's likely that your Cable margins could be around 60% in 2025?

Thank you for the question, Jerome, and I love your optimism. I am not going to start guiding, '24, let alone '25 this morning. Let me answer it this way, we have got, two capital-intensive businesses in Wireless and Cable with strong margins. Wireless right now is 64%, Cable is 53%. And they are both growing or expanding, as you would expect for a business that has a larger scale. We have essentially doubled the size of cable, with the Shaw acquisition, that brings some economies with it. It brings some additional capital spend with it. Wireless's margins cover, its investment in infrastructure as well as its investment from time-to-time in spectrum. And so very satisfied with the balance across all of that, particularly as a result of having increased the scale substantially for Cable to now roughly match where we are with Wireless in terms of national breadth and size of EBITDA and revenue. So, do I think there is room for further growth in Cable on its margin? Yes. We have posted the margin we have this morning on the back of a small decline in revenue year over year in the quarter. That's a pretty strong performance. There's more opportunity ahead, but I'm not going to guide beyond that. Jerome, I'm sorry.

Last question, Ariel.

Our final question comes from David McFadgen of Cormark. Please go ahead.

Just two questions just on the mobile phone. That adds obviously very strong. Just kind of wondering how many of those are on a bundle specifically in the West? Because it looks like you're starting to really derive some revenue synergies from the Shaw acquisition. And then secondly, on the leverage, you talked about your expectation to be able to drop it by 0.1 times to 0.2 times per quarter. Does that factor in the DRIP participation that you talked about in issuing stock from treasury? And what's the participation rate again? Thanks.

David, I'll start with the first one in terms of mobile net ads and the extent to which they're coming in on the bundle. I'm not going to disclose that type of granularity, but to put it in perspective, I would say, in terms of product convergence and therefore the bundling, it's early days. And so, while we're seeing good success in the overall scheme of total wireless loadings, it's still is the minority, not the majority to be clear. So, I just want to put that in perspective. And it's disproportionately better in the west only because we now are an alternative in the West. And so, we're new to the category of being able to bundle. And so, we're seeing very good market acceptance there. In the east, we've always been able to offer that bundle opportunity, and that continues to do well in the east as well. So that's how you ought to think about the trends on that and the relative size.

And then David, on the DRIP program, we launched that as I said for the October, quarterly payment, and the take-up rate with the first payment that it was available was 28%. Very pleased with that take up -- and so at a 30% run rate that would translate to roughly $300 million a year of cash savings I'll let you all know I understand and acknowledge that that does not mean the dividends didn't get paid. They got paid with our most expensive capital and shares. But that's how these programs work. And that is how we will preserve just that much more of our free cash flow to nominally pay down debt and deliever as well as by delievering through earnings growth. We do factor that in Dave. It's one of many variables that we will factor in as we go forward. But yes, that's included. As I say, when we -- I expect we will come down by 0.1 to 0.2 per quarter, roughly a half to earn a year. And we're on track for delivering exactly that. Keep in mind from time to time there will be spectrum investments made and so in one particular quarter here or there, they may be on the lighter side of the 0.1 or 0.2. But we are delivering very strong earnings growth and very strong free cash flow generation to continue that pace to delever. Very satisfied with where we are on it.

And thanks everyone for joining us today, and if there's any follow-up questions, please reach out to the IR team. Thank you.

This concludes today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.