Cell Canada

Canadian Cellular Industry News, Insight, & Noise

Archive for July, 2008

Update – Rogers Blackberry Bold Release Date

Posted by Gary on July 28, 2008

Quick update to our previous story (Rogers Blackberry Bold Canadian Release Date) about the Canadian release date for the Blackberry Bold. 

We’ve learned from another Rogers contact that they expect promotional material for the Blackberry Bold this week – the week of July 28th – and plan to have the Bold on sale next week.  Fits well with our previous story indicating a release date of August 6th.

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Calling Card Scams, Tricks, and Hidden Fees

Posted by Gary on July 25, 2008

The extremely high cost of long distance calling from our family’s cell phones has been the main reason that, until recently, we’ve held off on canceling our home phone line.  Like many others, we’ve come to realize that our cell phones have become our primary phones and our home phone has been relegated to occasional long distance calling.  The regular monthly bill for our home phone reminded us again last month that we should conduct some research to find a good option for long distance calling from our cell phone and do away with our home phone altogether. 

We’ve never been fans of calling cards, finding them to be just too much hassle.  Given the renewed motivation to toss the home phone, they seemed to be the obvious solution for occasional long distance calling from a cell phone.  Cheap too – we saw advertised rates, on card faces, of under one cent per minute to North America.  Almost too good to be true compared to the 30 cents per minute our cellular carriers charge for the same long distance calling destinations.

Anything too good to be true typically is just that, too good to be true.  If you flip calling cards over to view their back, and if you strain to read the fine print at the very bottom, and then persist to read it to about the two-thirds point, the published hidden fees begin to show up.

Published hidden fees such as:

  • Connection Charge.  A fee on the first minute of the call that is 6 to 10 times higher than the advertised per minute rate.
  • Minimum Call Charge.  A minimum charge per call.  On the cards that we reviewed, this equated to a minimum 4 to 6 minute call.
  • Two minute rounding.  We were completely surprised by this minute increment.  The card balance decrements in two minute increments!
  • Aging.  This is where the remaining card balance automatically decreases every day after it is first registered, whether you use it or not.

How does anyone ever know what they are really paying per minute with all of these additional varying charges?  We applied the rate structure, to the best that we could understand it, from one of these cards to a small sample of our recent long distance calls and discovered that instead of paying the 0.9 cents per minute on the face of the card, we were averaging over 8 cents per minute.  Just ridiculous.  Why do people keep buying these cards? 

On top of these published tricks, we learned that there are also many unpublished tricks.  Cards can be set to count a minute every 45 seconds.  Others have hidden time of day premiums, cell phone premiums, payphone premiums, and who know what else.

We are surprised that this industry exists in the way it does and with its apparent size.  There must be a study on human nature in here somewhere.  The gullibility of humans and how the species prefers a nice simple number while comfortably ignoring the pickpocket on its back.

To cut a long story short, we obviously passed on calling cards, we continued looking for alternative solutions and we found one in a cell phone long distance service from a company called Alligato Mobile.  The service seemed very straight forward on their web site, the rates were very good, and it was easy to sign up.  We’ve been using it for almost a month now and so far so good.   It is easy to use and the call quality is good.  We haven’t received our first bill yet and that will probably be the real test of whether we get what we think we bought.  We will keep you posted.

UPDATE AUG 3, 2008: We received our first bill from Alligato a few days ago and it looks very straightforward.  Each long distance call we made, minutes per call times the per minute rate.  Plus GST and PST.  No other charges or hidden fees.

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Rogers Blackberry Bold Canadian Release Date

Posted by Gary on July 22, 2008

We just received an update on the Rogers release date for the Blackberry Bold in Canada.  As we discussed in our earlier post on the Bold, Apple Iphone Vs. Blackberry Bold, the Bold is expected to be a strong competitor in the smartphone space, especially for customers with a need for heavy email and BES integration. 

For all of you waiting for the Bold, our moles inside Rogers have told us that it will launch in Canada on August 6th.  I’m sure we will see marketing and promotion in advance of the 6th. 

For you Blackberry fans, rest your thumbs…

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Blackberry Thunder – RIM Takes A Risk

Posted by Gary on July 20, 2008

Yes this is a bit premature.  The Thunder is not out yet and at best we have rumours on design and specs and photoshopped images.  However I thought I’d touch on it given that, with all the buzz around competitive responses to the iPhone from the major mobile handset manufacturers, this is the one that I believe has the most potential. 

No doubt the Samsung Instinct, the HTC Touch Diamond, the Sony Ericsson Xperia, and the Nokia Tube will have their strengths and given carrier marketing dollars, will take some market share.  Some, especially Nokia with it’s huge Forum Nokia developer community, will have the backing of developers, and most of them will have superior hardware specs to the iPhone – better cameras, video, etc.  However I don’t expect that any will capture the mass market consumer’s aspirational interest the way the iPhone has captured it.  They will not have the Apple brand image, the incredibly simple and elegant UI, and most of all, the fully integrated and well developed App Store.  Download portals – yes probably – but a simple, easy to use, fully capable application download function with discovery, one touch download and install, and a simple integrated payment mechanism – probably not.  And that is why they will remain also rans.  Many will promote how packed they are with superior hardware functions but the Internet scale innovation that a fully integrated App Store brings will be missing and with it, the weekly and monthly buzz about the latest and greatest must have application.  “Have you heard about Shazam?  It’s a super cool new app that…”

Current expectations have the Thunder arriving in September but given that the Blackberry Bold will probably land around then, expect RIM to clear some PR time for the Bold before beginning the Thunder PR press.  So Thunder in time for the Christmas season or early 1Q2009?   Mobile sales have taken up the retail sales cycle pattern over the last 3-5 years and the Christmas season now represents a significantly disproportionate amount of a carrier’s annual sales.  Given this, expect that RIM’s and it’s partners Verizon and Vodaphone will be pushing hard for a pre-Christmas release.  No word on a Canadian partner or date yet.

So why is the Thunder so interesting.  It will probably have a weak download portal like the other competitors and RIM has typically received poor reviews for its difficult developer tools.  The Thunder is interesting because RIM, similar to Apple, understands its market very well and knows how to laser focus product into its market.  They usually do not try to pack in the best set of hardware features and a kitchen sink into their high end products but instead understand the basic needs of the corporate market and fulfill those needs better than anyone.  Heavy email, high security, Exchange integration.  No one beats RIM in the corporation.  With the Thunder, RIM is taking a risk going keyboard-less but I expect that it is a well thought out risk and we may be very pleasantly surprised by the innovation in their touchscreen keyboard.  Current rumours list a soft keyboard with tactile feedback, full QWERTY and SureType entry, and multi-touch capability.  Add a Webkit browser and it gets interesting.  A RIM device, with BES integration, an innovative touch keyboard, and the most focused corporate needs execution, could hold back or slow down the iPhone’s push into the corporate world.  Or conversely, if RIM can’t hold it’s corporate turf against Apple, then Apple will own everything – the consumer market and the enterprise market.

 UPDATE: The Blackberry Thunder / Storm on video!

(I know there is a large camp that pines for a white knight in Android but I’m not drinking the kool-aid.  Android introduces more noise in an already noisy mobile OS ecosystem.  If anything, LiMo may be a stronger open source player than Android.  More on Mobile OS’s in another post.)

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Apple iPhone vs Blackberry Bold

Posted by Gary on July 17, 2008

Side by Side

Side by Side

The early reviews are in on the Blackberry Bold and comparisons with the iPhone are inevitable.  In summary, the comparisons highlight that these are two distinctly different phones with different strengths.  Perhaps the real RIM vs. Apple showdown will come when the Blackberry Thunder comes out later in the year with a large screen and soft touch keyboard.

 Boy Genius has one of the better high level reviews and it summarizes into:

1. If you are a hardcore Blackberry email junky and have a preference for a hard keyboard, then go Bold.  It’s a bit larger than recent Blackberry’s but has great styling, great keyboard, an improved browser and the best Blackberry screen to date.

2. If you are not hooked to Blackberry’s and are a moderate email user then go iPhone.  It’s the best general purpose mobile device.  Great OS, great design, the best browser, good email, and a growing list of easily accessible and innovative applications. 

The Bold looks great though I prefer the smaller size factor of the Curve.  Big anticipation here at Cell Canada for the Blackberry Thunder.  It will be RIM’s first foray away from the hard keyboard tha thas defined their products and success for so long.  If it just keeps up with the iPhone and doesn’t come with an App store, then RIM’s chances of defending against Apple longer term are suspect.

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Competition in Canadian Cellular – New Carriers Are Coming

Posted by Gary on July 17, 2008

Lost in the excitement of the iPhone launch, the Rogers data plan backlash and the Telus and Bell profit grab has been the news that there will soon be two to three new carriers in each market. These will compete for cellular customers against the incumbents Telus, Bell and Rogers.

This good news for consumers comes as the federal government’s process for awarding new cellular spectrum licenses approaches completion.

Industry Canada initiated an auction for new cellular spectrum this year that set aside part of the spectrum for non-incumbent carriers. The auction is almost complete and the resulting new landscape is becoming evident. 

Likely beginning in late 2009 to early 2010, each market in Canada will see the emergence of two to three new carriers.

The incumbent cable companies will begin to offer cellular service in their cable territories: Shaw in the West, Videotron in Quebec and parts of Ontario and Bragg in Atlantic Canada. In addition, Globalive will offer service in most parts of Canada outside of Quebec and a company called DAVE will offer service in large and medium sized cities in Ontario and Western Canada.

The incumbent cellular carriers will prepare well to defend against the new entrants through strategies such as using their flanker brands Fido (Rogers), Solo (Bell), and Koodo (Telus) to take away market opportunity, and by enticing customers into long term contracts. 

The new entrants however will still change the dynamic of the market. The strength of the incumbents in the market and the high cost of both the spectrum and network build will force the new entrants, especially the non-cable company entrants, to enter the market aggressively or risk an early demise.

The new entrants are all expected to build GSM technology networks, and Telus and Bell are rumored to be considering a conversion to GSM technology. From a consumer perspective, this means that, as in Europe and other regions, consumers will not have to change their phone every time they want to change carriers. As well, Rogers, by virtue of its GSM network, will no longer have a monopoly on GSM-only phones such as the iPhone.

Additional carrier choice, a single network technology and an aggressive approach to market share should bring better pricing and offers for consumers.

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iPhone – The Mobile Internet Is Here

Posted by Gary on July 17, 2008

It has been an unprecedented few weeks in the Canadian cellular market. 

The iPhone has finally arrived in Canada with an array of plan options, Bell and Telus have just announced new incoming text message charges, and there will be three new carriers vying for cellular customers by 2010. 

Cell phones have become a fashion item, a personal statement, a lifeline, a business tool, an entertainment conduit — a must-have 24/7 accessory. An estimated 50 per cent of the world’s population now uses mobile phones. This has grown rapidly from just 12 per cent in the year 2000.  

So why the hype around the iPhone? Its introduction heralds the beginning of a new era in mobile communications. Though referred to as a phone, it is much more. 

The iPhone is an Internet connected portable computer with a revolutionary user interface. It portends the mass market emergence of the mobile Internet – the Internet in your pocket. As a platform, it is as revolutionary as the first IBM PC with DOS. 

Just as during the early days of the personal computer, there have been other smart phones on the market for several years. The iPhone however arrives with the ecosystem elements to drive the smart phone into the everyday lives of consumers.  

From an ecosystem perspective, the iPhone combines an attractive piece of hardware with an elegant, innovative, and class-leading user interface. With Safari, it has by far the best mobile Internet browser. With the unique iPhone App Store, it is the easiest way for consumers to discover, purchase, and install software on a mobile phone. 

This is evident in the 10 million downloads from the App Store in the release weekend alone of the 3G iPhone. According to Apple, there are now more than 800 native iPhone applications available via the App Store, with 200 of them offered free of charge.

The completeness of the developer kit and the focus on creating an easy take-to-market, transaction, and billing and collection capability for developers will ensure that iPhone functionality grows tremendously as software developers create innovative new programs, ultimately leading to further consumer adoption.

So what does this mean to the end consumer? When the first cell phone went on sale in Canada on July 1, 1985, it was seen as a specialized niche business tool rather than the must-have mass market accessory it has become. Certainly, most did not expect to be personally paying around $60 per month in 2008 for this new cellular service.

In the same way that the cell phone and home high speed Internet have become integral necessities of life for many, the mobile Internet will become an integral part of the lives of the majority of Canadians in the next 5-10 years. Whether it is an iPhone or a competitor device, many of us will simply not be able to leave home without it. 

Having all of the world’s information available at all times — the Internet in your pocket — will become an indispensible part of everyday life. And of course, plan to budget an additional $30 to $50 per month to feed this habit.

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Text Messaging – The Bell & Telus Profit Grab

Posted by Gary on July 17, 2008

In the middle of the Rogers and Apple iPhone PR blitz and resulting Canadian consumer rebellion — as evidenced by www.ruinediphone.com’s  60,000-plus signatures — Bell and Telus announced they are going to begin charging for incoming text messages at 15 cents per message for customers not on bulk text messaging plans.  

By timing it this way the companies may have hoped to slip quietly under the iPhone PR and the Rogers iPhone plan pricing backlash. Instead the media positioned it as a continuation of the consumer backlash story, just as the Rogers plan story was beginning to crest.  

By introducing this additional charge, Bell and Telus will double their usage-based text messaging revenue with all the increased revenue coming in at 100 per cent profit. They currently collect 15 cents per message from the sender. With this change they will also collect 15 cents from the receiver. 

This is a doubling of the price for text messaging without any change in the cost or the usage. Consumers were understandably upset and the media fanned the anger by publishing reports about confused consumers who worried that their text messaging charges would increase by hundreds of dollars.  

Informing these heavy users that the additional charges could be mitigated by subscribing to bulk text messaging plans for $15 or so per month would not have made for the same sound bites.

Nonetheless, the release of the much anticipated iPhone, Roger’s mismanagement of the data plans and the Bell and Telus text messaging profit grab has further fueled the love/ hate relationship consumers have with their cell phone and cell phone carriers. 

While consumers are heavily attached to their cell phones, across the board feel that they are being unfairly gouged by the wireless carriers.  

This isn’t surprising, considering escalating System Access Fees, excessive long distance pricing, data pricing and the many small add-ons such as text packages and caller ID packages, all of which turn a $30 plan into a $60 bill every month. 

The new Rogers data plans as well as the new charges for incoming texts add to the already confusing array of packages, options, unknowns, and pricing that every cell user faces. Whether intentional or not, this confusion works to the benefit of the big three cellular carriers. 

When faced with the difficult task of comparing plans, options, and unknowns, consumer behavior dictates that, in general, consumers will avoid the stress by simplifying their decision. In this case, consumers simplify their shopping down to a brand, a phone, and a local minutes package, ignoring and passively accepting that they will be charged some unknown amount for everything else

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10 Tips For Saving On Your Cell Bill

Posted by Gary on July 15, 2008

To help navigate the recent changes in the cellular industry from a consumer perspective, we have summarized a list of 10 Tips for Managing Your Cell Phone Bill

  1. Avoid signing up for service contracts that will extend past early 2010. The emergence of new carriers in late 2009 and early 2010 will lead to much better market pricing from both the incumbents and new entrants.
  2. When shopping for a new plan, compare plans at a total bill level, including all options, fees, and charges. This is can potentially add up to twice the advertised local minutes plan charge so it only makes sense to compare plans based on the expected monthly bill versus just one plan component.
  3. Shop at independent dealers, such as Wireless Wave, instead of corporate stores. Our general experience has been that sales people at independent dealers seem to work harder to build the best package deal for customers.
  4. Get the sales people to do the work for you. The best way to shop for plans at the total bill level is to have the sales people build the lowest total bill options for your needs. We recommend taking your last two bills with details on your usage; Minutes usage levels (local, long distance, outgoing, incoming, evenings, and weekends), text usage levels, data usage levels, and options, to independent carrier dealers and letting them build the lowest cost total bill plan that they can to meet your needs. Have them email you the results and you can easily compare total bill options across carriers.
  5. Corporate Plans. Plans available to larger corporations can cost 15% to 30% less than those offered to individual consumers. If you have anyone in your family that works for a large corporation, have them check with their HR or IT department to see if the corporate cellular contract allows for employee purchases.
  6. Do not use the carrier’s long distance. Carrier long distance charges are much higher than home or office long distance charges and are one component of your cellular service that can be easily avoided. For long distance calling from your cell phone, use services from companies like Alligato Mobile. They work well with your cell phone, are very convenient, and cost very little.
  7. Do not use the carrier’s roaming. Roaming charges are very expensive and can easily add more than $1 per minute to your voice usage costs. If you travel frequently, use a service like Maxroam that offers very cost effective roaming calling from most of the countries in the world. If you only need occasional access to roaming, purchase a local prepaid phone or local prepaid SIM card from a shop at your airport of arrival. All international airports usually have shops that offer easy access to these products and they will save you a bundle on calling from your destination country.
  8. Use more text, less voice, and avoid an email plan if you can. As part of your package, purchase a bulk text package and use text instead of email. An average user can communicate as well with an average text message as he or she can within an average email. Just strip away the unnecessary words and get to the point.
  9. Wait to purchase the iPhone. If you can bear to wait. As per Tip #1, avoid locking yourself into a long term contract when significantly better offers will be available in 12 to 18 months.
  10. Use your phone less. Just kidding – we know you can’t.

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iPhone, Text Messaging, Cellular Competition, and Your Money

Posted by Gary on July 15, 2008

The iPhone has finally arrived in Canada with an array of plan options, Bell and Telus have just announced new incoming text message charges, and there will be three new carriers vying for cellular customers by 2010.  It has been an unprecedented few weeks in the Canadian cellular market.  Though there has been a deluge of press coverage, most consumers are still in the dark about what these changes mean to them and their wallet.   

Cell phones have become a fashion item, a personal statement, a lifeline, a business tool, an entertainment conduit, and a must-have 24×7 accessory.   Over 50% of the world’s population now carries a mobile phone.   This has grown rapidly from just 12% of the world’s population in the year 2000.   In Canada, there are now over 20 million active cell phone accounts representing over 60% of the population.   In more than 30 advanced wireless countries, mobile phone penetration has surpassed 100%.  In these advanced wireless countries, as a precursor of the future in Canada, mobile phones have also taken on the roles of electronic wallets, personal televisions, and much more.

The iPhone

Why so much hype?  The introduction of the iPhone in Canada heralds the beginning of a new era in mobile communications. Though referred to as a phone, it is much more.  It is an Internet connected portable computer with a revolutionary user interface.  It portends the mass market emergence of the mobile Internet – the Internet in your pocket.  As a platform, it is as revolutionary as the first IBM PC with DOS.  Just as during the early days of the personal computer, there have been other smart phones on the market for several years, the iPhone however arrives with the ecosystem elements to drive the smart phone into the everyday lives of consumers.  

 From an ecosystem perspective, the iPhone combines an attractive piece of hardware with an elegant, innovative, and class leading user interface.  With Safari, it has by far the best mobile Internet browser.   With the unique iPhone App Store, it is by far the easiest way for consumers to discover, purchase, and install software on a mobile phone.  This is evident in the 10 million downloads from the App Store in just the release weekend of the 3G iPhone.   According to Apple, there are now more than 800 native iPhone applications available via the App Store, with 200 of them offered free of charge.  The completeness of the developer kit and the focus on creating an easy take to market, transaction, and billing and collection capability for developers will ensure that iPhone functionality grows tremendously as software developers create innovative new programs, ultimately leading to further consumer adoption.

So what does this mean to the end consumer?  When the first cell phone went on sale in Canada on July 1, 1985,  the vast majority of the population saw it as a specialized niche business tool instead of the must have mass market accessory that it has become.   Certainly, the majority of the population did not expect to be personally paying over $60 per month in 2008 for this new cellular service.  In the same way that the cell phone and home high speed Internet have become integral necessities of life for many, the mobile Internet will become an integral part of the lives of the majority of Canadians in the next 5-10 years.  Whether it is an iPhone or a competitor device, a great majority of us will not be able to leave home without it.  All of the world’s information available all the time, the Internet in your pocket, will become an indispensible part of everyday life.  And of course, plan to budget an additional $30 to $50 per month to feed this habit.

Text Messaging

In the middle of the Rogers and Apple iPhone PR blitz and resulting Canadian consumer rebellion, as evident by www.ruinediphone.com’s  60,000 plus signatures, Bell and Telus announced that they are both going to begin charging for  incoming text messages at 15 cents per message for customers not on bulk text messaging plans.   By timing it this way Telus and Bell may have hoped to slip quietly under the iPhone PR and the Rogers iPhone plan pricing backlash.  Instead the media positioned it as a continuation of the consumer backlash story, just as the Rogers plan story was beginning to crest.  

By introducing this additional charge, Bell and Telus will double their usage based text messaging revenue with all of the increased revenue coming in at 100 percent profit.   They currently collect 15 cents per message from the sender.  Now, with this change, they will also collect 15 cents from the receiver.  That is a doubling of price for text messaging without any change in the cost or the usage.  Consumers were noticeably upset and the media fanned the anger by discovering confused consumers that worried that their text messaging charges would increase by hundreds of dollars.   Notifying these heavy users that they could mitigate these hundreds of dollars of additional charges by subscribing to bulk text messaging plans for $15 or so per month would not have made for the same sound bites.

Nonetheless, the release o f the much anticipated iPhone, Roger’s mismanagement of the data plans, and the Bell and Telus text messaging profit grab has further fueled the love hate relationships consumers have with their cell phone and the cell phone carriers.  Consumers are heavily attached to their cell phones but across the board feel that they are being unfairly gouged by the wireless carriers.  Whether it is an ever escalating System Access Fee, or excessive long distance pricing, or much feared data pricing, or all of the small additions such as text packages and caller ID packages that take a $30 plan and turn it into a $60 bill every month.   The new Rogers data plans as well as the new charges for incoming texts add to the already confusing array of packages, options, unknowns, and pricing that every consumer faces.  Whether intentional or not, this confusion works to the benefit of the big three cellular carriers.  When faced with the difficult task of comparing plans, options, and unknowns, consumer behavior dictates that, in general, consumers will avoid the stress by simplifying their decision.  In this case, consumers simplify their shopping down to a brand, a phone, and a local minutes package.  Ignoring and passively accepting that they will be charged some unknown amount for everything else.  

The New Carriers

Lost in the excitement of the iPhone launch, the Rogers data plan backlash, and the Telus and Bell profit grab, has been the news that there will soon be two to three new carriers in each market that will compete for cellular customers against the incumbents Telus, Bell, and Rogers.  This good news for consumers comes as the federal government’s process for awarding new cellular spectrum licenses approaches completion. 

Industry Canada initiated an auction for new cellular spectrum this year that set aside part of the spectrum for non-incumbent carriers.  This auction is almost complete and the resulting new landscape is becoming evident.  

Likely beginning in late 2009 to early 2010, each market in Canada will see the emergence of two to three new carriers.  The incumbent cable companies will begin to offer cellular service in their cable territories: Shaw in the West, Videotron in Quebec and parts of Ontario, and Bragg in Atlantic Canada.  As well, Globalive will offer service in most parts of Canada outside of Quebec and a company called DAVE will offer service in large and medium sized cities in Ontario and Western Canada. 

The incumbent cellular carriers will prepare well to defend against the new entrants through strategies such as using their flanker brands Fido (Rogers), Solo (Bell), and Koodo (Telus) to take away market opportunity, and by incenting customers into long term contracts.   The new entrants however will still change the dynamic of the market.  The strength of the incumbents in the market, and the high cost of both the spectrum and network build, will force the new entrants, especially the non-cable company entrants, to enter the market aggressively or risk an early demise.

The new entrants are all expected to build GSM technology networks and Telus and Bell are rumored to be considering a conversion to GSM technology.   From a consumer perspective, this means that as in Europe and other regions, consumers will not have to change their phone every time they want to change a carrier.  As well, Rogers, by virtue of its GSM network, will no longer have a monopoly on GSM only phones such as the iPhone.

Additional carrier choice, a single network technology, and an aggressive approach to market share should portend better pricing and offers for consumers.

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