The report has added new sections to the Canadian Telecommunications Report including our proprietary Business Environment Rankings in which we compare the Canadian market to eight other developed economies. Canada's low mobile penetration rate and the slow historical and forecast growth rate keep its Telecoms Market score low and the overall ranking for Canada is just above Italy. However, Canada's regulator scores highly for independence particularly in light of its drive to introduce new competition into the market following the spectrum auction that took place in 2008. Further, Canada's Country Risk score, analysing short and long term political and economic factors remains strong and comparable with its fellow developed markets. However, Canada's vast size and relatively small population affect the ability of operators to roll out services quickly and have been a clear impact on the country's growth rate.

Overall Canada was ranked eighth out of nine markets. Our market overviews also compare the Canadian telecoms sectors with their peers, seeing Canada ranked particularly well for fixed-line and broadband services.

Mobile penetration remains the lowest in the developed world having barely hit 65%. Although new operators are set to enter the market at the end of 2009 or early 2010 the report does not anticipate huge growth hitting the market as large towns and cities already have quite mature mobile markets and expanding services to rural regions will be costly, particularly for new operators. However, the new entrants should help to shake up the market a bit making the market more dynamic. TELUS Wireless looks set to overtake Bell Wireless as the second largest mobile operator if the latter does not see a turnaround in its business but overall the market remains quite stable.

The report has also introduced three company profiles for the largest operators in the Canadian market. Rogers Communications, Bell Canada and TELUS Inc have operations across the mobile, fixed-line and broadband markets and are the three largest mobile operators in the country. A vendor profile has also been added with our focus this quarter on Motorola and its prospects in the North American market.

The recession has obviously hit the market hard and telecoms service providers are seeing declines in growth. The broadband market has been reasonably resistant to the downturn but new subscribers will be harder to come by while existing subscribers continue to demand faster download speeds and new services. With growth set to slow, operators will need to find new sources of revenue growth while maintaining their infrastructure investments.