DAVE Wireless becomes Mobilicity: Chairman John Bitove (left) and President Dave Dobbin unveil Mobilicity, the companys go-to-market consumer brand name, at a press conference in Toronto, Tuesday, February 2, 2010.Derek Oliver
The message from Canada's new wireless players is loud, clear and threatening to the country's established telecommunications order: You no longer need a land-line phone.
Mobilicity, which launches service Saturday amid a flood of new wireless competitors, unveiled a suite of unlimited plans Friday aimed squarely at newcomers to Canada who call home countries, and family members who talk a lot among themselves.
"Think of us as like, the Winners of wireless," Dave Dobbin, Mobilicity's president and chief executive officer, at a store opening in a multicultural east-end Toronto neighbourhood.
But Mobilicity is also betting on a trend that followed the launch of new cellphone companies in the United States: Consumers cutting the cord on land-line telephone service with incumbent providers, such as BCE Inc.'s Bell Canada, to go completely wireless. In Canada, the quality of land-line service is excellent, but in recent years big telecommunications providers have steadily lost land-line customers; first, to cable companies that began offering phone service; and more recently, to a younger, more mobile generation that uses cellphones and VoIP - voice over Internet protocol, technologies.
"To my kids, it's uncool to have a land line," said John Bitove, Mobilicity's chairman.
From unlimited talking to unlimited texting plans for teenagers, Mobilicity is offering the type of service usually associated with the household phone. Other new entrants, such as Wind Mobile and Public Mobile, have unlimited offerings, but Mobilicity has $20 add-on plans that allow unlimited international calling to either East Asia or South Asia. This may attract immigrants from those countries and further threaten incumbent providers' lucrative land-line and long-distance revenues.
Wind offers national, unlimited long-distance plans, and Public Mobile will do the same when it launches, likely in the next month. International long-distance is likely to be the next wireless battleground after cheap unlimited talk-and-text plans, says Greg MacDonald, an analyst at National Bank Financial.
"New entrants are bringing wireline type services to wireless," Mr. MacDonald said.
Providing these offers is a key way for new entrants to differentiate themselves from the incumbent cellphone companies, Mr. MacDonald adds, and is more important than trying to distinguish themselves from other new players.
Larger providers, such as Rogers Communications Inc. and Telus Corp., have already begun adjusting to the presence of new entrants, analysts said. Mr. Dobbin, a veteran of Canada's telecom industry, said he expects the large providers to come out with more "flanker" brands; Rogers, for example, already owns Fido; Telus owns Koodo.
Amit Kaminer, a telecom expert with the SeaBoard Group consultancy, said he expects the cost of keeping customers with the incumbents - known in the industry as "retention" costs, such as offering one-off discounts - will climb. He also thinks the industry's established wireless players have a few surprises in store.