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Category Archives: bell

Harper and wireless: Is it Lost or Breaking Bad?

Is Stephen Harper really Walter White?

Is Stephen Harper really Walter White?

This past weekend, Breaking Bad cashed in big time at the Golden Globe awards with wins for both best drama and lead actor, with the inimitable Bryan Cranston finally getting accolades at the annual event for his fantastic portrayal of anti-hero Walter White. Anyone who has watched the show, which wrapped up last year, probably felt the kudos were well deserved – it truly was one of the best series to ever grace the airwaves.

What I liked most about Breaking Bad were how seemingly minor details were introduced in one episode, only to be revisited in later ones to further flesh out and illuminate the ongoing plot. It was these sorts of things – like Walter spelling out his birthday numbers with bacon – that really impressed upon viewers that the writers knew exactly what they were doing all along.

On the flip side, there’s the Canadian wireless market. In discussing the federal government’s long-running quest to bring more competition to the industry, most pundits – regardless of what end of the spectrum or ideology they subscribe to – have generally agreed that there’s been little rhyme or reason coming out of Ottawa. By all accounts, Prime Minister Stephen Harper and his crew have been making things up as they go, as the current disarray seems to prove. Rather than Breaking Bad, it’s been more like Lost – a show that didn’t really make sense but promised an epic resolution, yet failed to pay off in the end.

But what if everyone is wrong and the government’s plot really isn’t like Lost? What if, like Breaking Bad, the whole situation really has been meticulously planned and crafted, and is in fact playing out perfectly?

I know it sounds crazy, but hear me out. Read the rest of this entry »

 
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Posted by on January 15, 2014 in bell, government, mobile, rogers, telus, wind

 

Two-year contracts the latest wireless strawman

straw-manIt’s Dec. 2, which means the CRTC’s new wireless code is officially in effect. As of today, consumers will enjoy several new protections, including caps on roaming fees and a ban on cancellation charges after two years of a contract, which is the regulator’s de facto prohibition on three-year agreements.

Carriers have been busy implementing the new requirements for some time now, but some of them just couldn’t resist throwing out some parting shots in the process. About a month ago, both Bell and Rogers suggested that the required shift from three-year to two-year contracts was slowing smartphone growth, with the insinuation being that regulatory interference was somehow hurting Canadians’ supposedly insatiable hunger for the devices.

A number of industry observers evidently swallowed the line. As the lead of a Globe and Mail story proclaimed:

The introduction of new two-year cellphone contracts slowed subscriber growth for some of Canada’s biggest carriers during the back-to-school season, a sign that consumers are spurning those higher-priced plans even before they become the industry standard in December.

Ordinarily, such a statement would be attributed to the companies since it’s their position, but evidently the support of a market analyst or two is enough to make it fact. Scotiabank Capital analyst Jeff Fan provides the required back-up: “I would call it one of many ‘unintended consequences’ resulting from regulatory moves over the past summer,” he says in the above story. Fan also repeated the claims during our panel at the International Institute of Communications conference a few weeks ago. Read the rest of this entry »

 
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Posted by on December 2, 2013 in bell, rogers, telus

 

Why Conservatives aren’t winning in telecom

winningIf there was one takeaway from this week’s International Institute of Communications’ annual conference in Ottawa, it was the strong after-taste of winning. It doesn’t have much to do with Charlie Sheen, but rather explains the Conservative government’s problems with the telecommunications industry. Simply put, one of them is winning and the other is not. It’s pretty clear to anyone watching which is which.

The point was driven home at IIC again and again. In my own facts-versus-myths panel, Scotia Capital and Genuity analysts Jeff Fan and Dvai Ghose respectively noted the failures of the government’s policy objectives from the 2008 wireless spectrum auction. With Public Mobile sold to Telus, Mobilicity on the brink of failure and Wind, well, twisting in the wind, it’s obvious that the government’s biggest attempt to inject more wireless competition into Canada hasn’t worked out very well. Or at least, it worked temporarily, but it’s increasingly looking like it’s going to sputter out.

Fan also pointed to how the CRTC’s move to effectively ban three-year wireless contracts has caused monthly prices to go up. That was actually a no-brainer that was easy to see coming – several observers (myself included) predicted big price increases just as soon as the regulator announced its plan back in June.

Bell Media president Kevin Crull spent a good portion of his IIC address talking about how the government’s current desire to implement pick-and-pay TV channels may not necessarily lower costs for consumers. “As we move forward in responding to consumers, we need to be clear that there is an inherent risk. When buying less, the unit cost is going to be higher and overall savings, if any, may be small,” he said.

The best summary of all of this was a conversation I had at the conference with Celia Sankar, head of the non-profit Diversity Canada Foundation. Sankar told me all about the class-action lawsuit she has launched against Bell over its prepaid wireless plans. She’s arguing that prepaid balances shouldn’t expire in Ontario because they qualify as gift cards. (It’s illegal for gift cards to have expiry dates in the province.)

Given how these things go, I asked her if she was prepared for the eventuality that, should Bell lose the case and be forced to sack the expiration, the company might simply jack up prepaid rates in return. Tellingly, she didn’t really have an answer for that.

When critics attack the government for rightly trying to lower consumers’ telecom bills, there’s an almost contemptuous undercurrent to their comments. When they gleefully point out that the Conservatives’ efforts to lower bills haven’t worked, there’s also a sub-text that suggests they never will. The kicker is, such observers are right because they understand Sheen-ian winning.

Telecom companies have certain revenue streams that they’re used to. In fact, they have a responsibility to shareholders to continually grow them. So, a scatter-shot approach by the government that takes aim at one issue at a time – whether it’s three-year contracts, roaming, pick-and-pay channels – isn’t going to work in the long run, because the companies will inevitably just recoup the lost revenue in other ways. Nail them here and they’ll get you back there.

Without some sort of dramatic, large-scale action – the complete removal of foreign-ownership restrictions, structural separation or even the formation of a crown corporation are just a few options – the companies are going to keep on winning. The government, despite its best intentions, is destined to keep on losing.

 
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Posted by on November 22, 2013 in bell, crtc, government, telecommunications

 

Bell wanders into its own negative-option fiasco

double-dipIt’s been more than a week since the revelation that Bell Canada is gathering customer usage data with the intention of selling it for ads. I refrained from proclaiming it as the worst idea ever just to give it time to sink in, but yup, even with the benefit of sober second thought this is clearly one of those dumb moves that is either out of touch with what customers want or amazingly presumptuous about what the company can get away with.

In case you missed it, Bell has been sending out notices informing customers that, starting Nov. 16, it will be relaying new product offers based on their phone, internet and TV usage. As the Globe and Mail reports, this will include the monitoring and exploitation of:

Internet activity from both mobile devices and computers, including Web pages customers have visited and search terms they have entered; customers’ location; use of apps and other device features; television viewing habits; and “calling patterns.” Account information shared will include product use including type of device, payment patterns, language preferences, postal codes, and demographic information.

Customers will be able to opt out of receiving the ads, but not the data collection itself. Bell is painting the service as a win for consumers, since they’ll be able to receive ads that are more relevant to them. Hotels, for example, might be able to send ads to customers who are also frequent travelers. What Bell plans to do with the collected data on customers who have opted out, however, is a mystery. Read the rest of this entry »

 
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Posted by on October 31, 2013 in advertising, bell, Facebook, Google

 

Verizon in Canada: the darkest timeline

verizon-execsOne of the most interesting questions in the Great Wireless Debate of ’13 is whether Verizon’s entry into Canada – if it actually happens – will lead to lower cellphone prices. The government is insistent that it would, relying on simple economics for the argument: more competitors in any market means more choice for consumers, which leads to lower prices because some participants inevitably choose to use price as their differentiator.

That has been the case with the likes of Wind, Mobilicity and Public Mobile. The government credits its policies – which created those carriers – with helping to lower average cellphone bills by 20 per cent since 2008. The small companies have had a dual effect in that they have generally offered lower prices than Bell, Rogers and Telus, and they’ve also disciplined the Big Three in their own pricing.

The small guys are now in financial trouble, so wouldn’t it be nice if a well-resourced and stable force – also known as Verizon – could just slip into the new entrants’ shoes and continue the battle? So goes the government’s thinking. Read the rest of this entry »

 
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Posted by on August 28, 2013 in bell, rogers, telus, verizon

 

Level wireless playing field? Not in Canada

Bubble-Level1Over the course of this summer’s wireless war, the Big Three have thrown just about everything at the wall to see what would stick with the government and the public – threats of job losses, anti-American xenophobia, “dishonest” and “misleading” statistics, fears of service slowdowns, security concerns and the exacerbation of the rural digital divide. None of it has had any palpable effect, so now they’re leaning heavily on the “level playing field” idea.

To back up their claims that the government is favouring and even enticing foreign players such as Verizon into Canada, Bell and Telus wheeled out a nonsense survey (links to PDF) the other day that apparently shows Canadians to be against such a thing.

The headline result of the survey, commissioned by the two carriers from Nanos Research, is that a clear majority (81 per cent) of respondents do not want any companies – foreign or Canadian – favoured in the upcoming spectrum auction. As it stands, new entrants – or companies that have less than 10 per cent of the market – will be allowed to bid on two prime blocks of airwaves, while the Big Three will be limited to one. Read the rest of this entry »

 
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Posted by on August 23, 2013 in bell, government, rogers, telus, verizon

 

Lessons from New Zealand on Crown telecom firms

Saskatchewan: land of wheat... and innovation?

Saskatchewan: land of wheat… and innovation?

I wasn’t being entirely serious last week when I suggested that a potential plan B for the Canadian government, in the event that Verizon opts not to expand its wireless operations north, might be to start its own Crown cellphone corporation. But lo and behold just two days later, the Communications, Energy and Paperworkers – which counts many telecom employees among its ranks – echoed the idea with the same suggestion. In light of that, it’s perhaps time to examine the thought a little more closely.

The most obvious comparison to be made is to SaskTel, a provincial Crown corporation in Saskatchewan. The company competes against the likes of Bell, Rogers, Telus and Shaw across a variety of service offerings, including wireless, internet, landline phone and television. Even though the company is a relative flea compared to its rivals, it does pretty well for itself.

In 2012, it posted a profit of $130 million, with a dividend of $84 million going back to the provincial government. SaskTel began its upgrades to LTE wireless the same year, pushing its capital expenditure intensity up to a relatively high 26 per cent. Residents, for their part, seem to like the company, as evidenced by the 1.4 million accounts in a province of only a million people and its good standing in J.D. Power customer satisfaction surveys. This is probably because SaskTel’s prices tend to be better than its bigger rivals. Read the rest of this entry »

 
 
 
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