Five Questions with….Alek Krstajic

Alek Krstajic wants to rock Canada’s wireless landscape.

As the new CEO of BMV Holdings, he’s planning on introducing a $40/month flat-rate, no-frills, unlimited talk, unlimited text service next year. And he sees no reason why BMV won’t be wildly successful despite the fact the three major incumbents, Rogers, Bell and Telus, will make his and BMV’s life as miserable as possible.

With Krstajic’s appointment as BMV’s CEO unveiled earlier today, I managed to get him to answer a few questions about BMV and the wireless market.

Who are the people behind BMV?

The original five are Columbia Capital (Washington) M-C Venture in Boston, Charles Road Ventures, Roh Partners from New York, and Ignition. A the new [wireless] entrants called me but when I spent time with these guys, I learned that Columbia and M-C have made startup investment in Nextel, Metro PCS, Leap and Mobile PCS. They have more been there done that in the no-frills market than anyone. Ignition’s Steve Hooper is the ex-president with McCaw Cellular and AT&T Wireless.

So, what’s story of BMV. How did it only spend $53-million wireless spectrum?

The story is here is not Alek is so smart but Alek joined a bunch of really smart guys who did something that is brilliant. How is it possible to pay so little for something so good. G Band is part of the PCS band, not the AWS band. The mistake everyone made was Industry Canada threw it into the AWS auction. Some of the wireless players made calls to big handset manufacturers about whether the G band was useful. They said “no, this is stump spectrum for backhaul or microwaves”. Harry Hopper with Columbia did some research and realized all of the base stations see the AWS spectrum. The next thing they did was see who owned G band in the u.s. The entire G band in the U.S. is owned by Sprint, which traded 800 megahertz spectrum with the U.S. for G Band spectrum. Sprint wouldn’t give up 800 megahertz spectrum if it didn’t think the G Band was useful.

It looks like you’ll be operating a CDMA network before upgrading to LTE. Doesn’t that limit handset choice and make BMV less attractive?

I will buy three of 10 handsets [available] but my plan is not go up market. I don’t care about cameras or Web browsers. I’m more into the low end: $40 unlimited calling, unlimited text. We are trying to be the antithesis of what the inumbents are. The incumbents have unlimited but, which I call the Unlimited But plan. We have no system fees; the price is the price. From all my years with Rogers@home and Bell, I am an expert in customer irritants, and this my chance to build a brand from a concept that people buy from people they like and trust. We will have a brand that is friendly and easy to do business with.”

Is there room for more wireless players in Canada given how Bell, Telus and Rogers dominant the market?

We will not be the big dog but the dog you will not mess with because our cost structure is so low. The worse thing the incumbents can do is preempt our pricing by matching it. I’ll tell them no matter how low you go, you will lose more money and I will only be making less.

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