The most significant restructuring charge taken in 2004 was $985 million associated with our Voluntary Employee Departure Program. We expect the voluntary departures— which reduced our workforce by approximately 10 per cent—to produce annual savings of approximately $390 million. 

We are successfully executing our plan to reshape Bell Canada. In 2004, we defined the path for the future and laid the foundations. In 2005, we will execute our strategy and deliver improved operating results. By 2006, the company will be focused on service innovation, steady growth and increasing returns to shareholders. 

Because of our progress, I recommended that the Board increase the common annual share dividend by 10 per cent, or 12 cents a share. The Board did so in December. The dividend increase is important for two reasons. First, it increases our yield and provides our shareholders with a greater return on their investment. Second and more importantly, it sends a strong signal to our shareholders, to our employees and to our customers that we are confident in our forward momentum; our plan has traction. 

A clear strategic plan 

Our confidence is based on the very real progress we made in 2004. While Galileo paves the way for better performance, we also developed a clear strategic framework for making the world’s first “new telecom.” Our plan rests on three strategic pillars. These foundations are not new. They are a clear expression of the strategy we set out two years ago. And against which we have already made signifi cant progress. We will accelerate our progress over the next year as all of us at Bell drive the implementation of this plan. 

## 1 . Customer Experience 

Providing our customers superior product and service experiences that build loyalty and save time and expense. For them and for us. 

Our job is to take the power of the most advanced tech- nology and make it simple for our customers to use. So they can be better informed and entertained. So their businesses 

can be more productive and globally competitive. Our customers want our products and services to be easy to use, to work all the time. If there’s a problem they want us there to support them. 

Our response is an approach we call smart contact. This means we will help our customers adapt and use the latest technology without adding to the complexity of their lives. We will face them as one company. Provide them with the level of service that is at the core of our brand. 

Easy to say, harder to do. Like all organizations, sometimes we fall short. And sometimes, as with our recent migration to a new billing system for Bell Mobility, we do not execute as well as we should: we take a few steps back before moving forward. But we will  move forward. Superior customer service will be the centrepiece of our competitive advantage in the marketplace. We will succeed. 

## 2 . Reliable Bandwidth 

Providing our customers with ever-more-capable broadband connectivity that they can count on. 

In last year’s letter, I wrote at length about the promise of Internet Protocol (IP) connectivity and how it would usher in a new world of communications. A year later, I can say: it has. 

Last year, we successfully moved 60 per cent of our core network traffic onto an IP platform. We also completed IP migration plans for our entire Enterprise customer group— our 1,000 largest customers. For our small business and consumer customers, we began our pioneering rollout of Fibre-to-the-Node (FTTN). This will eventually allow Bell to deliver all our services—voice, data, video—over a single high-speed broadband network eight times faster than today’s current DSL connections. A network that will reach almost 85 per cent of all households in the Québec City to Windsor corridor. 

Put simply, we are committed to the IP revolution and its potential. Let me be absolutely clear: IP is not about delivering cut-rate voice connectivity over a DSL line or cable connection. IP is about delivering the promise of true, high-speed band- width over a reliable network that our customers can trust. 

