And beware of 5G hype, says dotmobile
By Ahmad Hathout
GATINEAU – Despite holding the largest wireless market share in Saskatchewan, crown corporation SaskTel said it doesn’t have the ability to lead on wireless prices in the province, cautioning against calls for it to be required to lease its network to mobile virtual network operators.
The comment came Thursday on the second last day of the CRTC’s wireless policy review hearing in response to a question about whether SaskTel has market power as a result of the western province being the only one in the country that isn’t majority-served by the big three national players, which hold a total of 90% share of subscribers in the country, according to the CRTC’s Communications Monitoring Report.
“The share we hold in Canada is only two per cent,” said Katrine White, vice-president of consumer sales and solutions (pictured in a cpac.ca screen cap). “We are a much smaller player and we don’t have the scale or the economies to compete in the same ways these competitors that compete in Saskatchewan do, so whether it’s through their advertising clout [or] their deep pockets with their offers… we have no ability to influence price in our market.”
White said the company can’t steer the market, be it through device or rate plans, and within a $5 range, it sees an increase in customer defections.
“We are very much price takers as opposed to price setters,” she said.
In the preceding days, witnesses before the CRTC called for SaskTel, one of the country’s older service providers, to be required to open its network to mandated MVNOs if the CRTC decides to go that way. In their opposition, the big national players have said such additional competitors would cripple the regional providers.
SaskTel buttressed that argument, suggesting the existing large number of brands in their market – 13 total, including the big three and their flankers – means competition is sufficient enough to make mandated MVNOs unnecessary and even detrimental. Saskatchewan already has the lowest mobile prices in Canada, too.
Rogers executives, however, said Wednesday that if MVNOs are forced, the CRTC should ease up on the newer players, such as Videotron and Freedom, but make sure legacy players in SaskTel and Tbaytel, who are very strong in their regions, face the same requirements as the Big Three
“We compete daily in hand-to-hand combat from pricing perspective, acquisition and retention,” White said, “and we are the subject of many targeted offers to have our customers switch from SaskTel to another carrier. So, we battle that out on an ongoing basis. We’re large in Saskatchewan, but it is a very competitive market.”
White urged the Regulator to be patient with the market and to trust the facilities-based process, saying in the company’s opening remarks competitors have offered $480 in credit to those who switch, while noting it’s in the unique position of being the largest wireless player in the province at the same time still being a fourth player fighting three national players.
Since being the first in Saskatchewan to build out its networks across the province, SaskTel has seen its market erode significantly over the last few years. So, on whether the CRTC should mandate plans with larger data packages at lower prices, as some consumer groups have urged, White was adamant about what that would do to its pricing model.
“The 5G race will not be won by being fastest to market.” – Algis Akstinas, dotmobile
Four gigabytes of data a month at $35 “creates a significant reprice for us so that is a concern for us.” She said the average amount of data use among its customer base is 2 GB per month.
The day prior, Rogers’ CEO Joe Natale said if his company is forced to provide 4 GB in that price range, it would effectively erase its profits and upend investments.
Also appearing on Thursday, the Ageing Communication Technologies group said the limited amount of data inherent in the low-cost data-only plans introduced last year have forced its cohort to effectively power-off their phone in case they need to use data for emergency calls. The big three players introduced plans ranging from $15 for 250 MB to $30 for 1 GB of data in 2018.
The group was also on-side the idea of having the regulator mandate shorter-pay-periods, such as on a weekly basis, for lower-income Canadians.
Early Thursday morning, the Independent Telecommunications Providers Association said there is a wireless divide between urban and rural markets with respect to “product offerings and competitive alternatives,” and urged the Commission to view a regulatory framework for MVNOs as the best way to close that gap.
The ITPA said regulating MVNOs would fulfill a major part of the 2019 policy direction from Innovation Minister Navdeep Bains to the CRTC.
Data On Tap (dotmobile), a new MVNO hopeful which wants to enter the market also appeared on Thursday, and its CEO Algis Akstinas told the panel of commissioners if they mandate full MVNO access to incumbent networks, dotmobile would be able to launch its operation within six months of a CRTC decision – a claim CRTC chairman Ian Scott quipped would be very quick.
But the company, which announced on the same day a new partnership to build its core network, also revealed that it’s also in talks with two incumbent operators, but could not reveal any details because the discussions are subject to a non-disclosure agreement.
Dotmobile CEO Algis Akstinas also poked fun at the “race to 5G,” suggesting that consumers don’t really care about it and it will only matter in three to five years – at the earliest.
“Besides, the 5G race will not be won by being fastest to market, but by making efficient investments at the right time and driving adoption and use of wireless services,” he said.
