Do Consumers Want Canada’s New Wireless Players?

In theory, more competition in Canada’s wireless market is a good thing because it will encourage the industry to become more innovative and, hopefully, it will drive down prices, which rank as the highest in the world.

The question, however, is whether consumers are interested in Canada’s new wireless players, which have emerged to compete against the three large incumbents – Rogers, Telus and Bell. So far, it doesn’t look like consumers really care much about the new competitors, which includes Wind, Public Mobile and Videotron.

Earlier this week, Wind CEO Tony Lacavera said the company has attracted about 140,000 customers. On the surface, it looks pretty good but it does appear the company has enough traction to reach its goal of 1.5 million customers by the end of its third year of business. In Quebec, Videoton only attracted 8,400 wireless customers in the third-quarter, failing to meet the 25,000 to 30,000 expected by analysts.

While the new wireless players will talk about the progress they are making, the harsh reality is Canada’s wireless landscape is a challenging place to establish a foothold when you consider how long the incumbents have been able to establish themselves. While the new players are valiantly trying to capture the attention of consumers, the incumbents are aggressively counter-attacking every move the new players make. A blatant example is Rogers’ launch of the low-cost Chattr brand earlier this year.

Maybe the the new wireless competitors need more time to win over consumers and position themselves as alternatives. Perhaps it is a matter of consumers being able to free themselves of long-term contracts before being able to consider alternatives. It could be that the new players need to offer cool smartphones given this is where the market is rapidly heading.

But any you want to cut it, Canada’s wireless market is, on the surface, more competitive but the bigger question is whether Canadian consumers are willing to enthusiastically embrace the new competitors.

About Mark Evans

I'm the principle with ME Consulting, which provides strategic and marketing services to startups and entrepreneurs. This includes strategic and tactics plans, core messaging, brand positioning and content planning and creation.
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  • Bruno

    I think your point about long-term contracts is the main reason. I barely known anyone who isn’t stuck in one! We’ll see the impact of these newcomers increase as more people get to the end of their contracts and can consider the new options. At the same time, the new networks will have gain in coverage and reliability. Give it time.

    My girlfriend just switched from Telus to Videotron when her long-term contract expired. I’m seriously considering the same when my own contract with Fido expires. I love the iPhone but the Nexus One isn’t bad either, hopefully Videotron will offer the iPhone when I’m free to switch.

  • /pd

    Correct =>Perhaps it is a matter of consumers being able to free themselves of long-term contracts before being able to consider alternatives
    Wrong => So far, it doesn’t look like consumers really care much about the new competitors

    I am a wind mobile user and pretty much darn happy with no contract and falt rate fee.. i pay for what I get.. and in TO. I hv np’s !

  • Steven Hodson

    Mark isn’t part of the problem with adoption of new wireless carriers more about the fact that they are really in limited markets. The only real coast to coast company is Bell with even Rogers and Telus still expanding their coverage. Sure they might have roaming agreements with each other (as do the new comers to a lesser degree) but they still lag behind Bell to a degree.

  • Mark Goldberg

    The net wireless adds of 8,400 doesn’t tell the real story at Videotron. If you read the details [news release here], there are 21,900 lines that are running on the new Videotron network after just 3 weeks of operation.

    The launch was so successful that Videotron ran out of devices, hindering even better growth. More than 1,000 activations per day seems to be a pretty strong indication that there is a lot of pent-up demand in Quebec.

    The question isn’t whether Canadian consumers have an interest in the new competitors. I’d be asking why Videotron’s launch was so successful?