Skip to main content

"No typing an e-mail. It’s just push a button, and boom, you’re through." Bell Mobility president Wade Oosterman with the company's new "push-to-talk" phones in Toronto, Monday, April 9, 2012.Kevin Van Paassen/The Globe and Mail

Smartphones seem to come with more bells and whistles every day, and selling those features has become huge business for Canada's telecommunications industry.

But it is a very different fight – over a phone that relies heavily on just one button – that is breaking out between two of the country's top telcos.

BCE Inc. is ramping up its presence in the push-to-talk business market, in a strategic strike aimed at dethroning rival Telus Corp. as the Canadian king of that lucrative niche.

The market provides simple yet sturdy phones to businesses in the mining, manufacturing, construction and transportation industries, among others. Unlike cellular service, push to talk (PTT) provides near-instant communication, including group conversations, while offering businesses cost certainty.

BCE's new push for PTT supremacy comes at a time when Canada's telecom industry is rapidly maturing and companies are eager to find new sources of revenue with specialty offerings. Business clients are attractive because of the potential of numerous subscribers.

Although the Canadian PTT market is not growing, BCE says there are "millions" of subscribers in public and private networks combined. The niche remains a cash cow for telecom providers because of its fat profit margins, high average revenue per user and low capital costs. Telecoms also benefit from a loyal client base, allowing them to use PTT to snag other wireless, land line and Internet business from those customers.

BCE's game plan centres on a new one-touch talk solution that it says will eclipse Telus' legacy Mike service on coverage, data speeds, software and handsets. By May 1, Bell Mobility will replace its outmoded 10-4 walkie-talkie service, which was plagued by lengthy connection times, with Bell Push to Talk, which offers connection speeds of one second or less.

The new Bell PTT includes a lineup of new devices including smartphones from Samsung and BlackBerry. While those sleeker devices are meant for office staff who support field workers, the centrepiece of its lineup is the Sonim XP5520 Bolt – a device rugged enough to withstand drops from significant heights or submersion in water.

"The big, big, big benefit of push to talk is that it is instant communication," said Wade Oosterman, president of Bell Mobility. "There's no dialling or anything like that. No typing an e-mail. It's just push a button, and boom, you're through."

Some analysts say PTT is likely on its last legs in Canada now that some subscribers are migrating to smartphones. It is a criticism Mr. Oosterman dismisses, noting certain businesses will always require rapid communication.

Bell's new service will enable simultaneous voice and data at fast speeds. And it is betting that utility will give it an edge over Telus' Mike, which is based on older technology known as IDEN that Sprint Nextel Corp. has begun phasing out in the United States. Sprint's planned shut down of IDEN has created some confusion about the future of Telus' Mike service.

For its part, Bell is eager to capitalize on that uncertainty. "If they are using a technology that is being wound down, obviously (they) need another solution," Mr. Oosterman said. "This is a better solution."

Jim Senko, Telus' vice-president small/medium business marketing, said Mike will remain the "gold standard" for PTT over the near term because the global IDEN network continues to grow – particularly in South America and the Middle East.

The global IDEN network has 18.8 million subscribers, with 6.3 million located in North America and 12.5 million in other markets. Telus declined to disclose its PTT subscriber count, but its 2011 annual report said Mike subscribers represented less than 5 per cent of its 7.3 million wireless subscribers, or roughly 365,000.

Because the IDEN network base outside of North America has grown at a 16 per cent rate over the past three years, Telus says there is no danger of handsets going away – even if Sprint is shutting down IDEN in the U.S.

"We have no plans to shut down our Mike network," Mr. Senko said. "We are continuing to run it. In parallel to that, we are currently pursuing an LTE push-to-talk solution."

As a result, Mr. Senko argues that Telus can afford to take its time to outline its plans on the next-generation LTE, or Long-Term Evolution, which can better support an IP-based voice solution because of higher bandwidth.

In doing so, he took a swipe at Bell, saying its new PTT service could be compromised by data congestion from other mobile subscribers who use the HSPA+ network – a criticism Bell refutes.

"Even though there may be claims of performance, when the HSPA network is highly congested performance will degrade," Mr. Senko said of Bell.

Follow related authors and topics

Authors and topics you follow will be added to your personal news feed in Following.

Interact with The Globe