Cell Canada

Canadian Cellular Industry News, Insight, & Noise

Posts Tagged ‘Telus’

Globalive – New Canadian Wireless Carriers Series

Posted by Gary on February 3, 2009

Here at Cell Canada, we’ve had a great deal of interest in the new Canadian Cellular Carriers.  Questions about their service launch dates, technology, pricing, and monthly service plans.  Starting with Globalive, we are starting a series where we will summarize and infer what we can to help answer these questions and more.

Globalive

Owner: Orascom out of Egypt has majority ownership but Globalive has controlling interest to meet Canadian foreign ownership regulations.  What does this mean?  It’s Orascom’s money and they are in charge.  Good for competition in Canada.  Orascom has about 80 million cellular customers worldwide with properties in the Middle East, Europe, and Asia.  That’s more than all of the existing Canadian cellular carriers (Bell, Telus, and Rogers) combined.  They will not be muscled out or outspent by the incumbent Canadian carriers.

Management: Globalive is still building it’s management team.  At the date of this article, active recruiting is underway for several ‘C’ level roles.  The key CEO role is in place however.  Ken Campbell is a Canadian with a great deal of experience with start up wireless carriers in Eastern Europe.

Marketing and Brand:  Expect a no-frills consumer brand.  The betting line to date is on ‘Yak Mobile’.  Noticeably, Yak has shut down its www.yakmobile.com web site.  In advance of a launch later in the year?

Technology: Globalive will be launching the current revision of the GSM technology train.  Expect UMTS and HSPA technology similar to what Rogers has currently deployed.

Plans: Expect innovative, for Canada, low end plans: $10/month, $15/month, etc. and potentially text only plans.  The recent moves by Koodo, Solo, and Fido to offer $15 plans with no system access fees are a clear indication of the incumbent Canadian cellular carriers re-positioning their brands to protect their soft flanks – where they expect the new carriers to enter.

Phones:  Of course we don’t know specifics of phones that will arrive a year from now but what we can infer is that given their strong buying power (Orascom’s 80 million customers) and targeting of the low end of the market, Globalive – or Yak Mobile – will probably offer basic feature phones and low end smartphones.  Expect some unique phones, perhaps more Nokia and other low end feature phones that we haven’t seen in the market to any great degree under the Bell, Rogers, and Telus umbrellas.  Also expect that with their buying power, they will get some interesting phones in advance of the incumbent Canadian carriers.

When:  Globalive is already building network in the major Canadian cities where it has licenses.  There is a lot of work to get a mobile carrier business started and offering services.  Network is one aspect but OSS systems, distribution channel, etc. all take time to put into place.  Expect a launch in late 4th quater 2009 to 1st quarter 2010.

Hope this answers some of your questions.  Feel free to add anything that you may have learned about Globalive’s plans in the Comments section.

Advertisements

Posted in Uncategorized | Tagged: , , , , , | Leave a Comment »

Blackberry Storm to Launch Exclusively on Telus in Canada

Posted by Gary on October 8, 2008

Blackberry Storm

Blackberry Storm

Telus has their Blackberry Storm teaser page up.  It’s identified as an ‘exclusive’ and thus implies that we will not be seeing the Storm on Rogers or Bell at launch.  Quite the sweep by Telus given the expected corporate and consumer interest in the device.  However we expect that the use of the term ‘exclusive’ may apply to the EVDO/HSPA model versus the pure HSPA model (‘exclusive’ on Rogers).

Here’s the page: http://promo.telusmobility.com/storm/

Here’s the Vodafone page with more graphics and a specification sheet: http://blackberry.vodafone.co.uk/storm/

Posted in Uncategorized | Tagged: , , , | Leave a Comment »

Blackberry Thunder / Storm Release Date and Other Rumours

Posted by Gary on September 9, 2008

Verizon Blackberry Storm Box from Engadget

Verizon Blackberry Storm Box from Engadget

The Blogsphere is brimming with speculation on the upcoming Blackberry Thunder. 

 

A quick recent rumour mill summary:

  • It will be called the Blackberry Storm 9530 on Verizon
  • It will be called the Blackberry Thunder on Rogers and Vodafone
  • It will be exclusive to Rogers in Canada
  • Telus will also carry it in Canada. (Yes, conflicting rumours)
  • It is ready for prime time and expected out on Verizon in October
  • The user interface and OS is still buggy and it will be delayed into November
  • It will include Wi-Fi
  • It will not include Wi-Fi
  • The touch keyboard: haptic feedback, full Qwerty in landscape, and Suretype in portrait
  • 8 GB microSD included.  Raising hopes of strong multimedia capabilities

Of the rumours to date on the Storm/Thunder, a few things stand out for us. 

1. World phone.  CDMA/EVDO and UMTS/HSPA in one piece of hardware spells bulk.  Good for CDMA players and their business customers but a handicap when compared to pure UMTS/HSPA devices.

2. No Wi-Fi.  If this is true, then it will be a significant liability relative to other new smartphones such as the iPhone.  The majority of the average user’s time is spent in home and work environments that can support much faster speeds via Wi-Fi.  Wi-Fi for speed and EVDO/HSPA for coverage appears to be a reasonable approach taken by other smartphone vendors.

3. Battery life.  Heavy users, especially business users, need their device to work all the time.  Time is money etc.  It will take more battery than a traditional Blackberry to power the big screen.  More battery implies more bulk.

4. Keyboard, keyboard, keyboard.  Blackberry’s are highly regarded, rightfully so, for having fantastic keyboards.  They keyboard will make or break this Blackberry.  No doubt, great Exchange integration, rock solid reliability, and enterprise grade security have all contributed to the RIM’s success and should be expected on the Storm / Thunder but without a novel writing worthy keyboard, this Blackberry only will fall into line with the other ‘average’ business smartphones.

We are longtime Blackberry fans and are hopeful and excited about the launch of this device.  If the keyboard is close to as good as a traditional Blackberry hard keyboard, then we will forgive the bulk.  Though maybe not the lack of Wi-Fi.

UPDATEThe Blackberry Thunder on Video

Posted in Uncategorized | Tagged: , , , , | 11 Comments »

Student Cell Phone Plan Deals

Posted by Gary on August 25, 2008

Back To School Student Cell Phone Plans are summarized very well by Firestorm on RedFlagDeals.com. 

Though most of these are better deals than standard market plans, they still pale when compared to corporate plans and employee purchase plans that can be acquired with a bit of homework.  Also, as we recommend in 10 Tips for Saving on Your Cell Phone Bill, ensure that you compare at a total bill level.  Many of the plans below require another $15 for Caller ID and Voicemail, or have similar expensive basic bolt-ons that drive up their price by $10/month to $30/month for most people.

Firestorm’s summary:

                                                                            

Rogers
Not listed on website.

Add these to ANY plan as long as you’re a student:
Evenings start at 6PM for free for 3 years
Home Calling Zone for $5 off/month for 3years
If you sign up for 3 years with $15 or $20 Value Pack, you get $5 off each month for 3 years [remember, $15 value pack includes unlimited web browsing and $100 off any vision phone]

$25 + $6.95 + $0.50 + tax
100 Weekday Minutes
1000 Evening/Weekend Minutes starting at 9pm
500 Incoming Minutes
My5 + 5 (so 10) Local

$45 + $6.95 + $0.50 tax
450 Weekday Minutess
Unlimited Evening/Weekend Minutes starting at 9pm
Unlimited Incoming Minutes
My5 + 5 (so 10) Canada-Wide

Telus
$35 + $6.95 + 0.75 + tax
200 Weekday Minutes
Unlimited Evening/Weekend Minutes starting at 6pm
MyFaves 10 Canada-Wide
Unlimited Web Browsing on PCS devices (not smartphones)

$50 + $6.95 + 0.75 + tax
200 Weekday Minutes
Unlimited Evenings/Weekend Minutes starting at 6pm
MyFaves 10 Canada-Wide
Unlimited Web Browsing, E-mail (PDA smartphones and blackberries only), and Instant Messaging

Bell

$25 + $8.95 + $0.75 + tax
100 Local anytime minutes
Unlimited local calling and texting with 10 numbers
Unlimited local night and weekend (9 p.m. – 7 a.m.)
Call Waiting, Conference Calling

$35 + $8.95 + $0.75 + tax
250 Local anytime minutes
Unlimited local night and weekend (9 p.m. – 7 a.m.)
Unlimited local and Canadian long distance calling and text messaging to your 10 favourite numbers
500 sent and unlimited received picture and video messages
Call Waiting, Conference Calling

$45 + $8.95 + $0.75 + tax
350 + 100 Local anytime minutes
Unlimited local night and weekend (6pm – 7am.)
Unlimited local and Canadian long distance calling and text messaging to your 10 favourite numbers
500 sent and unlimited received picture and video messages
Call Display, Message Centre Express, Call Waiting, Conference Calling

(DEAD) $40 + $8.95 + 0.75 + tax
250 Weekday Minutes
100 Canadian Long Distance Minutes
Unlimited Evening/Weekend Minutes starting at 9 PM
Unlimited Local Incoming Calls
Unlimited Mobile Browsing in Core Network areas (100 minutes in other areas)
Call Display

Virgin
$35 + tax: myCrew 35

* 200 Anytime Minutes
* Unlimited Evening and Weekend Calling Starting at 7pm
* Unlimited Nationwide Talk and Text to 5 Buddies
* Bonus – Get 5 Extra Buddies for 10 in total
* No System Access Fee, No Activation Fee

$45 + tax: myCrew 45

* 400 Anytime Minutes
* Unlimited Evening and Weekend Calling Starting at 7pm
* Unlimited Nationwide Talk and Text to 5 Buddies
* Bonus – Get 5 Extra Buddies for 10 in total
* No System Access Fee, No Activation Fee
Limited Time myTimeTM Bonus

Want unlimited 9-5 calling? Now you can get 8 hours of unlimited daily calling with myTimeTM.

$35 + tax: myTime 35

* 200 Anytime Minutes
* Unlimited Calling within the daily 6-hour calling block
* Unlimited Calling all day Saturday and Sunday
* Bonus – Get 2 Extra hours for a total 8-hour calling block
* No System Access Fee, No Activation Fee

$45 + tax: myTime 45

* 400 Anytime Minutes
* Unlimited Calling within the daily 6-hour calling block
* Unlimited Calling all day Saturday and Sunday
* Bonus – Get 2 Extra hours for a total 8-hour calling block
* No System Access Fee, No Activation Fee

                                                                              

 Anyone find additional student / back to school cell phone deals?

Posted in Uncategorized | Tagged: , , , , , | 25 Comments »

GSM in Canada: Bell, Telus & The New AWS Carriers

Posted by Gary on August 6, 2008

Canada is soon to be flush with GSM technology based carriers.  This, along with the upcoming significant increase in new carriers born out of the AWS auction, is great news for Canadian mobile consumers. 

The mobile industry, like many technology driven industries, is a global industry.  Global demand and market share dictate priorities for research and development expenditures.  GSM has taken a significant lead in global market share over CDMA technology.  This lead has grown from 55% global market share for GSM in the year 2000 to over 85% of global market share in the year 2006.  A good amount of this growth has come as fast growing mobile markets such as China and India have chosen the GSM standard over CDMA.  The last remanants of CDMA carriers, primarily those in North America and South Korea have begun to indicate that they will be moving over to GSM technology standards in their next set of network evolution investment.  In fact, evolution of the CDMA technology has been effectively halted after the release of EVDO Rev.B.  The outstanding question for most CDMA carriers is whether they wait and suffer competitively relative to GSM carriers for two or three years until GSM 4G LTE technology is commercially available in 2010/2011 or whether they undertake a significantly capital intensive two step approach and move to UMTS, 3G GSM, now and then step to LTE in 2011/2012/2013.

In the USA, Verizon has publicly stated that it will be shifting to the GSM technology camp by overbuilding its network with LTE as soon as it is commercially available.  In Canada, it is well known in the industry that Telus and Bell have issued a joint RFP for UMTS and are currently field trialing the technology from the four short listed vendors.  They will certainly move to GSM technology though whether they do it in two steps, UMTS first then LTE, or in one step, wait for LTE, is not known. 

The new AWS auction based cellular carrier entrants; Shaw, Videotron, Bragg, DAVE, and Globalive, will all certainly come to market with UMTS based services, starting sometime in late 2009.  Initially, as they build out their networks, they will offer services delivered via resale of the Rogers UMTS network.

What does this mean for consumers? 

For one thing, this means that Rogers will no longer have technology based exclusives on the best phones.  Hot new devices such as the iPhone, Blackberry Bold, etc. will be available on all networks at once – whether through the locked phone market or the unlocked phone market.  This loss of GSM phone exclusivity will force better handset and plan offers from Rogers otherwise they will risk losing customers to the other carriers.  As we discussed in 10 Tips For Saving on Your Cell Phone Bill, it is best to avoid 3-year contracts that lock you into high prices in advance of the upcoming increased competition. 

Additionally consumers will be able to change phones by simply moving their SIM to a new phone.  As in Europe and Asia, there will be a competitive aftermarket for unlocked GSM phones on the North American spectrum blocks. 

A similar benefit in reverse is the ability to keep your physical phone but purchase a temporary in-country SIM when travelling to avoid roaming costs.  We discuss tips for saving on roaming in 10 Tips for Saving on Your Cell Phone Bill as well.

At Cell Canada, we are very excited about finally getting competitive access to some of the best phones in the world at dramatically better phone and plan pricing.  Bring on the Nokia N96, the Blackberry Bold, the Apple iPhone, Sony Ericsson Xperia1, and the other upcoming great phones with plans on any of six carriers in our local market.

Posted in Uncategorized | Tagged: , , , , , , , , , , | 17 Comments »

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.

Posted in Uncategorized | Tagged: , , , , , , | 3 Comments »

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

Posted in Uncategorized | Tagged: , , | Leave a Comment »

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.

Posted in Uncategorized | Tagged: , , , , , , , , | Leave a Comment »

Bell & Telus Incoming Text Messaging Charges

Posted by Gary on July 10, 2008

The story of Bell and Telus introducing a 15 cent charge for incoming text messages has been widely covered with the usual man-on-the-street interviews.

Hyperbole flies on either side.

The press finds lost soul txtrs that will see charges in the hundreds of dollars. Please someone tell these people that they can add unlimited texting to their plan for about $15/month.

Bell and Telus on the other hand defend the need to add the charge to cover the cost of delivering text messages. This logically implies that when they originally set text messaging charges, they mistakenly assumed that text messages were only sent but not received.   An insulting and disingenuous argument.  Similarly, their argument regarding increasing infrastructure costs driven by the popularity of texting is also weak.   A packet switched 160 Byte SMS message requires significantly less network resources than a 1 minute circuit switched voice call.   In the US market, CrunchGear did a simplified analysis of the price of text messages relative to the price of wireless data and came to the conclusion that AT&T is pricing text messages at $1,310/Megabyte.  A bit simplified but still illustrative of the big hole in the centre of the Bell and Telus ‘cost’ rationale for the incoming text charges.  All of a sudden, the Rogers iPhone data plans don’t look so bad.

As this story has played out, two thoughts stand out for me:

1.   How did two competitors decide to introduce an exactly equivalent new charge on exactly the same day?  Has no one noticed that this smells of collusion?  Is the competition bureau sleeping?  Industry Minister Prentice is upset with the charges but has not shown any concern about the circumstances: “While I have no desire to interfere with the day-to-day business decisions of two private companies, I do have a duty as minister of industry to protect the interests of the consuming public when necessary,” Prentice said in a statement.  Have Canadians become so desensitized to the oligopolistic behavior of the industry that we accept this as normal?

2.   Why now?  Why did Bell and Telus announce this now during a period of massive iPhone 2.0 PR and the consumer backlash against Rogers’ data plans?  Were they hoping that it would slip in under the other news?  If so, they’ve miscalculated in a big way.  If anything, with Rogers backing down on data plans, whether temporarily or not, the bubbling consumer anger has turned to point at Telus and Bell.  The heat comes off Rogers and soon stories about iPhone launch breakfasts, lineups, and excited early buyers will put the rose back into the Red.

The cell industry in Canada has been a circus the last few weeks.   As a result of all of this, in the short term at least, it seems that everyone loses.  Bell and Telus mess up their timing and damage their brands, Rogers damages its possible massive upside with the iPhone, and of course the consumer loses all around.  In the medium term, Bell and Telus will rake more margin, Rogers will adopt the same incoming text charge and rebuild its brand around back to school and holiday season iPhone sales.  The consumer will still be sitting in the nosebleed seats.  At least until late 2009, early 2010 when two to three new competitors enter most markets and the party starts.

Posted in Uncategorized | Tagged: , , , , | Leave a Comment »