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An unlikely telecom mastermind, Quebecor’s Dépatie faces revenue challenge

Robert Dépatie has not granted any interviews since he took over from Pierre Karl Péladeau in May, and still wants more time before talking to reporters, a Quebecor spokesperson said.

Christinne Muschi/The Globe and Mail

Pierre Karl Péladeau's retirement from Quebecor Inc.'s daily operations took everybody off guard. Not so the choice of his successor, Robert Dépatie, the former CEO of telecom unit Vidéotron Ltée whose pick was almost self-evident.

"Given he knew intimately Quebecor's most important and profitable business, it was perfectly clear to us he was the best-suited person," says Françoise Bertrand, chair of Quebecor's board. Vidéotron accounts for 90 per cent of the group's operating profits.

Had you known Mr. Dépatie 15 year ago, you would not have guessed he would end up in telecom. The marketing expert had spent most of his career in the food business, his last stints as president of food distributor Le Marquis/Planters and as executive vice-president at H. J. Heinz Co.'s Canadian operations.

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That he was CEO material was apparent all along, says his friend Alain Brisebois, executive vice-president at Rona Inc. Both men were in their twenties when they first met: He was a buyer at grocer Metro while Mr. Dépatie sold Hawaiian Punch for Del Monte. "People who have natural leadership have this uncanny ability to find solutions, and it was pretty obvious he had it back then," Mr. Brisebois recounts.

Mr. Dépatie has not granted any interviews since he took over from Mr. Péladeau in May, and still wants more time before talking to reporters, a Quebecor spokesperson said.

Mr. Péladeau recruited Mr. Dépatie in 2001 right after Quebecor acquired cable company Vidéotron. At the time, his official title was vice-president, marketing, but his real job was to fix Vidéotron's customer service, which was so poor that recordings of angry clients went viral.

At first, Quebecor and Vidéotron's technicians clashed. There was a short strike and a long lockout, but after a year marked by vandalism acts and a war of words, the cable company rehired its outsourced technicians under new terms. The service now runs smoothly and is known for its professionalism.

The outcome impressed Normand Provost, executive vice-president, private equity, at the Caisse de dépôt et placement du Québec, which holds 24.6 per cent of Quebecor Media. "The labour relations were tense, but in a short period of time, he turned the service around and made it into one of Vidéotron's distinguishing forces," Mr. Provost says.

Fixing customer service earned Mr. Dépatie the corner office at Vidéotron. Mr. Dépatie next oversaw the launch of the cable company's phone services, first IP telephony, then mobile.

Vidéotron's phone services proved widely successful. At last count, Vidéotron has 1.28 million phone subscribers and 478,000 mobile users.

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To acquaint himself with the industry, Mr. Dépatie became a geek of sorts, his colleagues say. He attends the Las Vegas consumer electronics show and tests every mobile phone before it is offered in store. He is currently holding on to his Samsung Galaxy S4, filled with more than 100 apps.

"He doesn't do things by halves," Mr. Brisebois says, adding he is as fanatical with phones as he is with the "extravagant" cars he drives. Mr. Dépatie has ditched a yellow Ferrari Mr. Brisebois remembers and now drives his Lamborguini Gallardo 2013 or his Rolls Royce Ghost 2014.

"He is the most driven executive I have ever worked for, and not everybody can handle that," says Manon Brouillette, Vidéotron's new president and chief operating officer. "But he has so much confidence in you that he gets you to push back your own limits."

Ms. Brouillette recalls when Mr. Dépatie asked her to oversee the deployment of the company's 3G network under a schedule so tight her first instinct told her to say no, but he swayed her into taking the mandate.

"Mr. Dépatie transformed Vidéotron into one of the best run cable companies in North America," says Magher Yaghi, tech analyst at Desjardins Securities.

Since Mr. Dépatie succeeded to Mr. Péladeau, Quebecor has sharpened its focus further. The company unloaded peripheral websites and buried the hatchet with TC Transcontinental. Quebecor sold to the printing company Sun Media's 74 Quebec regional weeklies and pulled out of the door-to-door distribution of flyers, long Transcontinental's stronghold.

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"When you bring in somebody new, it is easier for them to make those decisions, because they have no baggage," Mr. Yaghi notes.

"Whereas Pierre Karl is intuitive and entrepreneurial, Robert is more methodical, more of a classic manager," adds Ms. Bertrand.

Quebecor's acquisition of the French broadcasting rights to the NHL games has attracted all the attention of late, even if the 12-year, $1.5-billion deal will see its value revised downward as the Montreal Canadiens opted out and sold the rights to regional games to BCE's Réseau des Sports channel.

But the real action is not on the ice – it is in cable. While Bell lost market share in telephony, it is now making a breakthrough in Vidéotron's cable base with its Fibe service. Vidéotron lost 22,500 subscribers in the year that ended Sept. 30, and is bound to loose more, Mr. Yaghi believes.

"The issue is how Vidéotron will maintain its profit margins as its market share declines and how the company will make up for lost revenue with other products such as wireless," he says.

That will be one of Mr. Dépatie's biggest challenges.

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About the Author
Chief Quebec correspondent

Sophie Cousineau is The Globe and Mail’s chief Quebec correspondent. She has been working as a journalist for more than 20 years, and was La Presse’s business columnist prior to joining the Globe in 2012. Ms. Cousineau earned a master’s degree in journalism from the University of Illinois and a bachelor’s degree in economics and political science from McGill University. More


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