Canadian start up looking to establish itself in cities across North America

A telecom services provider is looking beyond Canada’s borders to establish itself as a major player. One of the fastest growing segments of the Canadian telecom market is providing services to buildings. Companies are tripping over one another to sign contracts with large property developers. TrizecHahn, which is dumping its real estate holdings to get into carrier hotels, has invested in a reseller that has far reaching goals. NetStone Communications Inc has been in operation since December 21 of last year. Having its headquarters in Ottawa, it services buildings in the capital as well as Vancouver, Calgary, Edmonton, Winnipeg, Toronto and Montreal. CEO Peter Sandiford believes expansion is likely. "We may go to Halifax," he told Network Letter, "but our main focus at this point is to consolidate our leadership position in the biggest market segment in Canada and then head into the U.S." He would not specify which cities, but said major American metropolitan areas are in the firm’s plans. This would reverse the trend of U.S. companies heading north. One of the most recent entrants is OnSite Access Inc of New York. Although NetStone is registered with the CRTC as a reseller, the executive sees his company on a broader level. "We’re a full service provider. We see ourselves as providing a full range of services to the clients in the buildings, to the tenants, and that means really providing integrated services for telecommunications, computer services and applications," Sandiford states. The firm is using Bell Nexxia to provide it with the backbone needed to service its clients. "It’s not a wholesale/resell agreement," the CEO reports. "It’s really a quite unique arrangement that allows us to acquire the bandwidth and a lot of the support service from Nexxia and incorporate those into services we’ve created ourselves by utilizing the Nexxia network." In addition to telecommunications, NetStone also provides voice, LD, Internet and wireless services to small and medium business in commercial complexes. But it also serves as an ASP and manages servers for its clients. "Our argument to tenants is ‘why would you want to buy telecommunications from one vendor, when you have all these other things you need to get in order to be successful?’" asks Sandiford. The money behind the company has come from the founders and TrizecHahn. A second round of financing is being initiated and Sandiford expects an announcement of new capital by the late summer. Because of the dual nature of its business, NetStone has attracted experienced staff from telecom and computing. Chair Maher Awad has worked for Northern Telecom, Bermuda Telephone and was a founder of the consulting firm MenaTel. His MenaTel colleague, Sandiford, was chair of Unibex Inc, a provider of B2B services. For 10 years he was president of SHL Systemhouse, an Ottawa systems integration and outsourcing company. MetroNet Communications, now part of AT&T Canada, is the alma mater of VP sales Robert Aldrich and western VP David Schultz. Jonathan Macdonald worked for Sprint Canada, Lanser Telecom and Bell Canada before becoming NetStone’s VP of engineering and development. Sandiford is even more excited about the prospects of hiring on the computing applications side. "The good thing about the Ottawa marketplace is that there are no service providers here, but there’s a tremendous pool of technical people," he notes. The acquisition of SHL Systemhouse by EDS put more people on the market, many of whom NetStone hired. Sandiford estimates most of his 75 workers come from the Ottawa or Toronto areas. NetStone is concentrating on its Canadian centres in the short run, with plans to move into the U.S. by the end of the year. The CEO does not discount the ability to move internationally. "If you look at any large city in the world, which has office towers, and has the ability to get high speed bandwidth into the building, that’s all we need and we’re in business. So let your imagination run wild."

Canadian start up looking to establish itself in cities across North America

News | July 31, 2000

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