A Fourth Wireless Carrier in Canada? Really!
The Globe & Mail has a story on speculation the federal government may recommend that a fourth national wireless carrier be created to stimulate competition. I hate to rain on anyone's parade but it ain't going to happen. First, if Ottawa really wanted another carrier to stimulate competition it would never have approved Rogers' $1.4-billion takeover of Microcell. Second, just because the federal government recommends another carrier be established, who's going to spend hundreds of millions of dollars to do it given there are already three well-entrenched rivals in the market. If anything, Canada could do with a few more MVNOs to stir things up - much like Virgin Canada is trying to do. The MVNO model is Canada is lagging the U.S., but there doesn't appear to be much interest among Telus, Rogers and Bell given there's plenty of low-hanging fruit left to be picked.
February 27th, 2006 at 8:41 pm
Agreed. Not sure where the heck that theory came from. It's kind of ludicrous, actually.
February 27th, 2006 at 9:58 pm
If real, this would be just another example of government coming forward with an idea whose merit has long since past - if in fact, it was ever a good idea.
The biggest threat to the current wireless service providers, and therefore the source of greater competitive pressure, is not additional telco operators with expensive infrastructure, but instead Wireless VoIP companies. Companies like Skype and Google are likely going to introduce products in this space before the end of the year. This is the area where we should be encouraging investment (although it really doesn't take all that much) and more importantly - innovation. I am all for greater competition in the Canadian market place. Having just returned from working and living in the US, I got hooked on their 'all you can eat' plans. Returning to the 'clock watching' plans that we have here has been frustrating. So I would like to see us improve the competitive landscape. But let's take a 21rst century approach to the challenge!
Oh, by the way, you gotta love the consistency of these Telco Execs. Here is a quote from the article in the G&M that you referenced; the wireless executives said last week they expect customers' monthly bills will keep rising in coming years as they spend more on data services, such as ring tones or TV .
These guys continue to sing the mantra of growing ARPU thru data and 3G (or now 3.5G) offerings. This has not been the experience in Europe, where they are significantly ahead of us on the wireless adoption curve, and have been aggressively marketing data services with offerings like Vodafone Live, for several years now. All they have managed to do is stave off further price erosion, and stabilize customer churn.
February 28th, 2006 at 1:53 am
Mark I think you're right, we would all like to see more competition in areas surrounding wireless, broadband, etc.
I wrote to MNVO Helio to see when they might make it up north:
Hi Aaron. No plans to enter the Canadian market quite yet. We are still concentrating on our US launch in spring. Keep your fingers crossed…Canada may be next!
Doesn't sound like we'll see them anytime soon…
February 28th, 2006 at 10:11 am
I always wonder where these kinds of things pop up from. Your point about Microcell nails it: if the plutocracy was so gosh darned concerned about competition, they *had* their chance to make that known. To me, this smells like a scare attempt: keep the telcos on their toes by hanging the spectre of increased competition over them. Might be enough to temper greed, short term anyway, even just a little.
– Stuart