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U.S.-based telecom XO Communications expands to Canada

A man talks on his cellphone in Toronto.

Fred Lum/Fred Lum/The Globe and Mail

A U.S. communications company is expanding its footprint to Canada in a bid to capture a slice of the budding telecom market for business customers.

XO Communications said Tuesday it will offer a range of telecom services, including high-speed Internet, now that it has extended its fibre network to a major communications nerve centre in downtown Toronto. In particular, XO is eyeing business customers in industries ranging from financial services to technology.

Herndon, Va.-based XO, which operates a national network across the United States, said its Canadian expansion reflects the "growing demands" of its enterprise and wholesale customers that are increasingly seeking global connectivity. Its entry also marks the latest burst of competition in the small- and medium-sized business market – a customer base that is providing new growth opportunities for the telecom industry.

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"As the largest network hub in Canada and a major hub in North America, Toronto is a key business centre for the finance, high-tech, media and telecommunications industries," said Don MacNeil, XO's chief marketing officer, in a release.

"Our expansion into Canada will enable XO to provide high-capacity network services to better serve businesses like these on both sides of the border, whether they need connectivity in Toronto or high-speed access to markets in the U.S."

XO is not the only foreign-based telco hungering for Canadian growth. Last month, China Unicom opened an office in Toronto in a bid to provide network backbone support for Canadian telcos requiring connectivity to China and to provide telecom services to business customers operating in both countries.

Some Canadian cable companies are also eager to grow their roster of small- and medium-sized business clients. For example, Rogers Communications Inc. has purchased companies like Blink and Atria, while Montreal-based Cogeco Inc. scooped up MTO Telecom and QuietTouch.

Wind Mobile, meanwhile, is also eager to poach more small-business customers. It recently announced a new wireless plan that includes "unlimited" Canada-U.S. talk, global text and premium data for $55 a month.

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