TORONTO – While a wide range of hopeful competitors have backed a mandated MVNO, or some sort of variant on it, regime from the CRTC, CFOs from two of Canada’s Big Three Telecoms – Glen LeBlanc (Bell) and Telus’ Doug French – insisted last week such a move would be irresponsible of the Commission to implement.
Speaking at TD Securities Telecom and Media Forum in Toronto last week, the executives, in separate presentations, touted their respective company investments in having built the infrastructure that now serves Canadians from coast to coast. (MVNO = mobile virtual network operators.)
“We don’t believe that MVNO is what’s best for Canadians,” LeBlanc (pictured) said, taking a more direct approach than his Telus counterpart. “We have a leadership position in networks. And we didn’t get here by accident, we got here by investing. Our investment cycle has been so long, we’re enjoying the returns from those investments. But for new entrants (such as Shaw, Eastlink and Videotron) at the front end of their investment cycle where they’re buying spectrum and making network investments with the hope for return, MVNO will destroy them, destroy the industry and destroy investment at a time when we’re about to embark on one of the most important investments in wireless history with 5G. It’s a bit mind boggling, but we’re hopeful rational minds will prevail.”
Telus’ Doug French more measured in his response to the same query, noting the company is anxiously waiting more information on what a new, MVNO-enabled wireless landscape could resemble.
“We have more than 10 brands in Canada now,” French said. “Bringing in MVNOs, in my mind, may or may not accomplish what the government is looking for, if you’re referring to pure pricing. Especially when you look at the quality of our networks and the investments we’ve made to make Canada the second-best networks in the world. I think what we’ve done well, even under the CRTC to date, is to invest and see some return on that investment. If that starts to be challenged, I’m not quite sure what that profile will look like in the long run.
“It will probably take a couple of years to fold out if it were to happen. When you look at the increasing intensity with Freedom, Videotron, Bell, Telus and Rogers, it’s not as if any company steps back in any given month… Our ARPU (average revenue per user) trend has actually been on the decline and the industry overall has been pressured with double data, so we’re hoping the competition regime that’s there right now is driving the right behaviours in the government’s mind and they don’t have to go down that path.”
French added with the U.S. probably down to three providers with the impending T-Mobile/Sprint merger in a holding pattern pending all necessary approvals (but FCC chairman Pai is already on board and perhaps the Department of Justice, too), he questioned why government believes Canada must increase the number of wireless providers.
“The U.S. is potentially down to three providers. Europe is down to two and three providers, so why does Canada need four or five? It’s inconsistent with providing high-quality service when you’re going down that path,” he said.
While Rogers’ CFO Tony Staffieri or chief technology officer Jorge Fernandes stayed away from the MVNO topic, the pair did take the opportunity to tout the company’s solid financials, while also revealing the next technological developments coming to the Ignite TV platform.
“[Comcast’s] Ignite platform is a fantastic aggregator of content, giving customers an almost curated access to OTT services,” Fernandes said, noting that while Netflix is currently offered via Rogers’ Ignite TV platform, they will soon be adding Amazon Prime as an offering. He also anticipates Disney’s upcoming streaming service will be available to Rogers customers when it launches later this year.
“Over the coming months, we will have xFi in-home, wall-to-wall Wi-Fi pods, and will then evolve that to xHome, which offers smart home connectivity,” Fernandes continued. “The idea behind these products is to make the life of the customer easier. We will not only have access to the devices that Comcast is deploying, but another great thing they are doing, which we are working closely with them on, is the ability to onboard other ecosystems, allowing customers to choose the Google or Amazon ecosystem to allow them to manage their devices.”
Asked if Rogers intends to launch a skinny television service in the same spirit as Bell’s ALT TV and Telus’ Pik service, Staffieri says there are no technical concerns or impediments standing in the way of such an offering.
“With the Comcast roadmap, it’s something that is available to us,” Staffieri said. “As we launched the Ignite service, we wanted to enter the market at the premium end, and that’s what we did with phase one of the launch. The next phase will be about expanding service to mid and lower tiers, and is what we’ve done as we ramp up volume with Ignite TV. What you’ll see from us over time is that a flex product will be included in our offerings.”
