The Good, the Bandwidth and the Ugly: BCE Buys Phone Retailer, Passes 1m FibreOP Premises, Hit With Civil Suit

Bell Canada Enterprises (BCE) has agreed a CAD594 million (USD520 million) cash-and-stock deal to buy independent cellphone retailer Glentel, the Globe & Mail reports. The deal will give Bell ownership of Glentel’s roughly 500 own-brand retail locations in Canada, as well as kiosks at Target Canada and Costco under the names ‘Wirelesswave’, ‘Tbooth wireless’ and ‘Wireless etc’. BCE previously bought another phone retail chain, The Source, with around 750 locations, in 2009. The Source now exclusively sells BCE-owned wireless products, but the Glentel outlets will continue to distribute rivals’ products, at least for the time being.

In other news, BCE’s Atlantic Canada-based division Bell Aliant has announced reaching its end-year target of making its fibre-to-the-home (FTTH) ‘FibreOP’ broadband services available to one million homes and businesses, with the milestone deployment of the millionth premise passed achieved in Oromocto, New Brunswick, it said in a press release. Bell Aliant simultaneously announced a free FibreOP internet speed upgrade – the third in the last two years. On 7 December 2014 the 50Mbps/30Mbps (down/upload) package is raised to 75Mbps/30Mbps and the 80Mbps/30Mbps package jumps to 150Mbps/30Mbps, while the top speeds available are boosted significantly from 250Mbps/30Mbps to 400Mbps/350Mbps. In addition, in a recently announced partnership with its sister Bell Media division, Bell Aliant will also offer a new subscription on-demand video streaming service, code named ‘Project Latte’ focusing on premium TV content.

Elsewhere, CBC News reports that an Ontario court has certified class action lawsuits against Bell and rival Telus over the practice of rounding up calls to the farthest minute whilst not immediately disclosing the method to certain customers. The class actions were certified on behalf of Canadian residents who subscribed to Bell services and were billed by the minute between August 2006 and October 2009, and Ontario residents who subscribed to Telus services and were billed per-minute between August 2006 and July 2010.

Thanks to TeleGeography for the article.

Telus Abandons Bid For Mobilicity (Again)

Canada’s Telus has dropped its latest bid to acquire financially-stricken smaller cellular rival Mobilicity, the Globe & Mail reports. The newspaper writes that Telus informed Mobilicity this week that it was withdrawing its latest takeover offer because ‘conditions of the deal had not been met’. One condition was that the federal government approve the transfer of spectrum between Mobilicity and Telus – a move which Ottawa opposed in two previous attempts by Telus to buy the smaller company. Last month Telus agreed terms to purchase Mobilicity for CAD350 million (USD317.6 million) in a transaction to be implemented under the Companies’ Creditors Arrangement Act (CCAA). The telecoms ministry Industry Canada had blocked both previous takeover attempts by Telus under a spectrum transfer policy aiming to restrict acquisition of new entrants’ 3G/4G frequencies by national incumbents. The latest development reportedly leaves Mobilicity, which is operating under bankruptcy protection, without a known bidder to take over the company.

Thanks to TeleGeography for the article.

Telus Boosts Revenue 5% In Q1; Announces Spending Plans

Canadian quadruple-play operator Telus reported a 4% year-on-year rise in net profit to CAD377 million (USD347 million) in Q1 2014, on consolidated quarterly revenues which increased by 5% to CAD2.9 billion. Telus also reported that it added a net 48,000 post-paid mobile subscribers in the three months ended 31 March 2014, which was lower than the 59,000 post-paid users added in 1Q13, but was a higher rate of customer acquisition than both of its nationwide cellular rivals Rogers and Bell. Telus’ fixed broadband net user additions reached 21,000 in the first quarter, 5,000 higher than the level of take-up a year earlier.

Telus has also reported this week that its consolidated capital expenditure (CAPEX) excluding the purchase of spectrum licences in 2014 will increase modestly to approximately CAD2.2 billion, as it continues investing in wireless capacity and mobile network expansion, alongside broadband infrastructure expansion and upgrades, including bringing fibre-optics deeper into the network, to support ‘Optik’ TV and high speed internet subscriber growth and faster connection speeds.

Of the total CAPEX, Telus will invest CAD1.2 billion across British Columbia in 2014 on projects including the rapid deployment of 700MHz LTE spectrum in rural and urban parts of the western province, to enhance 4G coverage which already reaches 90% of the provincial population, involving dozens of new wireless sites along remote highways. Telus will also connect thousands of homes and businesses in various British Columbia communities with higher-capacity internet and Optik TV. Telus also committed to spending a further CAD1.6 billion in British Columbia in the two-year period 2015-16.

In another regional rollout statement this week, Telus said that CAD640 million of 2014’s CAPEX would be spent across the province of Quebec. Projects this year for Quebec include connecting thousands of households to direct fibre-optic connections in Cap-Sante, Donnacona, Neuville, Pont Rouge, Rimouski, Saint-Apollinaire, Saint-Augustin-de-Desmaures, Saint-Georges and Sept-Iles. Another priority is expanding the 4G LTE network to over 80% of the Quebec population by the end of 2014 (involving utilisation of the 700MHz band). Telus also committed to spend a further CAD700 million in Quebec in 2015-16.

Thanks to TeleGeography for the article.

Telus proposes Mobilicity takeover for third time

Financially stricken Canadian cellco Mobilicity has announced that larger national rival Telus has agreed terms to acquire the company for CAD350 million (USD317.56 million) in a transaction to be implemented under the Companies’ Creditors Arrangement Act (CCAA). Mobilicity has been operating under CCAA since September 2013, with the completion of a takeover transaction as its key initiative. The sales process has been supervised by court-appointed monitor Ernst & Young, and the press release said the takeover ‘provides for a complete continuation of Mobilicity’s business for the benefit of its stakeholders’, while ‘the vast majority of Mobilicity’s 165,000 active subscribers will be able to seamlessly migrate onto TELUS’ advanced HSPA network after the transition,’ and there are ‘no foreseen changes to employee staffing levels as a result of the proposed transaction.’ The release added that ‘approximately 95% of the holders of Mobilicity’s 15% senior unsecured debentures due 2018 support the transaction’, which remains subject to approval by the Ontario Superior Court of Justice, the Competition Bureau and Industry Canada as well as Mobilicity’s debtholders. The green-light is by no means guaranteed, as Industry Canada has twice blocked the deal under its spectrum transfer policy aiming to restrict acquisition of new entrants’ 3G/4G frequencies by national incumbents.

On 23 April 2014 Mobilicity will ask the court for an extension of the current Stay of Proceedings from 30 April until 30 June, while on 30 April its creditors will meet to vote on the latest proposed deal with Telus.

Thanks to TeleGeography for the article.

Public Mobile shutting down CDMA in May, moving to parent Telus’ network

Small cellco Public Mobile, a subsidiary of nationwide Canadian operator Telus, has announced that it will shut down its CDMA-based network covering Montreal, Toronto and surrounding areas in May this year, and migrate all users to its parent’s GSM/W-CDMA/HSPA/LTE network. In a notice for its subscribers on its website, Public warns users that in May they will need a new phone compatible with the Telus network to continue receiving services. It is offering a discount on the handset purchase for existing customers, whilst all its tariff plans are changing in May.

Thansk to Telegeography for the article. 

Eight 700MHz licence winners spend CAD5.3bn

Telnet Networks- Managing Network PerformanceCanada’s Minister of Industry James Moore yesterday (19 February 2014) announced the conclusion of the country’s 700MHz 4G mobile broadband spectrum licence auction. 97 regional licences were awarded to eight companies in the auction which finished on 13 February, meeting the government’s aim to license at least four wireless players in every Canadian region. Total revenue generated from the 700MHz auction was CAD5.27 billion (USD4.80 billion), the highest return ever for a wireless auction in Canada, beating the AWS 2100MHz spectrum auction in 2008 which raised CAD4.3 billion. The relative value of spectrum in Ottawa’s 700MHz sale was also higher compared to the 2008 700MHz licence auction across the border in the US, which gleaned USD19.1 billion – or quadruple the Canadian revenue to cover nine-times the population, TeleGeography notes. Moore said in a speech that Canadian operators obtaining licences will be able to start deploying 700MHz services in mid-April 2014.

The eight winners are listed below (number of paired/unpaired spectrum licences; price paid; licence population covered [of a total population of roughly 35 million]):

Rogers (22 paired; CAD3.292 billion; 33,368,699);

Telus (16 paired + 14 unpaired; CAD1.143 billion; 33,475,914);

Bell (17 paired + 14 unpaired; CAD565.7 million; 33,475,914);

Videotron (7 paired; CAD233.3 million; 28,020,943);

Bragg (Eastlink) (4 paired; CAD20.3 million; 3,101,204);

MTS (1 paired; CAD8.8 million; 1,206,968);

SaskTel (1 paired; CAD7.6 million; 1,039,584);

Feenix Wireless (100%-owned by Mobilicity chairman John Bitove, whose Obelysk investment firm owns a majority voting share and minority equity share in Mobilicity) (1 paired; CAD284,000; 107,215).

By province, 700MHz licences were awarded as follows:

Newfoundland & Labrador – Bell, Eastlink, Rogers, Telus;

Nova Scotia – Bell, Eastlink, Rogers, Telus;

Prince Edward Island – Bell, Eastlink, Rogers, Telus;

New Brunswick – Bell, Eastlink, Rogers, Telus;

Quebec – Bell, Rogers, Telus, Videotron;

Ontario – Videotron [south Ontario only], Eastlink [north Ontario only], Bell, Rogers, Telus;

Yukon, Northwest Territories and Nunavut – Bell, Feenix, Telus;

Manitoba – MTS, Bell, Rogers, Telus;

Saskatchewan – SaskTel, Bell, Rogers, Telus;

Alberta – Bell, Rogers, Telus, Videotron;

British Columbia – Bell, Rogers, Telus, Videotron.

Biggest spender Rogers announced that its new 700MHz spectrum covers 99.7% of the Canadian population, with two blocks of contiguous, paired spectrum located in key rural and urban locations across Canada. Specifically, Rogers acquired the A and B 12MHz blocks in Southern Ontario, Eastern Ontario, Southern Quebec, Eastern Quebec, British Columbia, Alberta, Newfoundland, Nova Scotia and New Brunswick. Rogers also acquired 12MHz of C block spectrum in Northern Quebec, Northern Ontario, Manitoba and Saskatchewan. Rogers added that its cash investment of CAD3.29 billion was ‘in line with recent spectrum transactions’ in the US, where the price range for prime 700MHz spectrum in major states has been in excess of USD4.00 per MHz/population, adding that in the 2008 US 700MHz auction, the top 25 markets sold for USD4.50 per MHz/population, while by comparison Rogers has paid CAD4.32 per MHz/population for the major markets across Canada, securing two blocks of paired spectrum with licence terms that are 33% longer than comparable 700MHz concessions in the US.

The CEO of second largest 700MHz investor Telus, Darren Entwistle, said the addition of the 700MHz spectrum will enable Telus to expand its LTE coverage into rural areas, extending its national 4G LTE footprint from the current 80% population coverage to 97% ‘well in advance of the auction’s build requirements’. ‘Moreover, the spectrum will enable us to further enhance our coverage in urban areas, adding much needed capacity,’ he added.

Wade Oosterman, president of Bell Mobility, announced that Bell already offers LTE services to 82% of the population, and the new 700MHz spectrum will allow Bell to expand LTE coverage to 98%, by launching services in smaller towns, rural locations and remote communities across the country including the Far North.

Perhaps the most notable winner in the 700MHz auction was Quebecor subsidiary Videotron, as the Quebec-based quadruple-play operator expanded its reach outside its home province to Ontario, Alberta and British Columbia, as well as buying additional spectrum in Quebec. Videotron announced its satisfaction in gaining access to potential coverage of 80% of Canadians for a significantly lower price than its larger cellular rivals.

Two qualified bidders did not win any 700MHz licences, namely TBayTel and Novus Wireless, while Wind Mobile withdrew from the 4G auction shortly before it commenced on 14 January 2014.

Thanks to TeleGeography for the article.

Telus overtakes Bell as second largest mobile operator by users

Telnet Networks- Managing Network PerformanceCanadian quadruple-play telco Telus has posted a 3.6% year-on-year increase in EBITDA to CAD951 million (USD865 million) in the fourth quarter of 2013, on consolidated quarterly revenues which climbed 3.4% to CAD2.948 billion in Q4. Notable in Telus’ end-of-year results was the fact that it narrowly surpassed Bell Mobility as Canada’s second largest mobile operator by users, with its total wireless subscribers standing at 7.807 million at 31 December 2013, compared to 7.670 million a year earlier (exceeding Bell’s figure by 29,000). Telus’ fixed broadband customer base grew by 5.2% in 2013 to 1.395 million, and its pay-TV customers, largely based on IPTV, rose by 20.2% to 815,000.

Thanks to TeleGeography for the article.