BCE Inc's proposed takeover of CTV Inc is the final piece of a puzzle that should see the telecom giant retain its place at the head of the pack, according to a new study by the Yankee Group in Canada.

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A new entrant to the CLEC wars is challenging conventional telecom wisdom, saying bundling and longterm contracts mimic the old monopoly models and do little to serve small- and medium-sized business customers. Cannect Communications Inc arrived on the Canadian scene just over two years ago, and is currently making its way eastward. On May 25, the company announced that it is now providing data and voice services over high-capacity fibre networks to downtown Ottawa businesses.

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Armed with $745 million from its initial public offering, 360networks Inis ramping up an ambitious construction program that will see 90,000 route km of fibre optics installed by mid-2001 throughout North America and Europe, as well as undersea. The Canadian leg of the network – some 2050 route km – should be finished by the end of the year. By early next year, it will have doubled the reach of its fibre across North America to more than 38,400 route km. Its Hibernia project, now named 360Atlantic, should be rolling into Europe soon.

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Business demand for telecom services is growing so rapidly, foreign firms are now flocking to Canada. One of the most recent to enter is OnSite Access Inc of New York, which recently established a Canadian subsidiary to provide services to small- and medium-sized businesses in commercial buildings. OnSite Access-Canada's new president and GM believes there are two reasons his employer has set up shop here.

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The completion of CANARIE's cross-Canada optical network combined with the plummeting cost of dark fibre is accelerating the rollout of regional and municipal fibre builds. With municipalities in Quebec and Ontario now firmly committed to dark fibre builds, and announcements pending in British Columbia, Alberta and Nova Scotia, observers say Canada is poised to overtake the U.S. in deploying publicly owned, open access fibre networks for major cities and even small towns.

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