Bell and Telus may switch to GSM by 2010: Analyst

Speculation has run rampant in the past year that Canada's two CDMA carriers Bell Mobility and Telus Mobility are considering a switch to a GSM-based network. And while that may be true, a leading wireless industry analyst doesn't think any decisions will be made until 2009 with deployments potentially beginning the following year. In part two of Report on Wireless' interview with Brian Platts from NBI/Michael Sone Associates, the analyst suggests the two wireless operators aren't going to make any rash decisions about networks platforms just because their rival Rogers Communications Inc. is winning the wireless network speed battle. Rogers is barreling ahead with its High-Speed Packet Access (HSPA) network, trumpeting the speed premium over its CDMA rivals. But this doesn't appear to be forcing the hands of Bell and Telus. "The short answer is that while the two operators, Bell and Telus, are making money on they have absolutely no incentive for change," Platts tells RoW. "If they think they can buy themselves another year or so for peanuts, then they'll do it." Besides, time may play into the hands of the two CDMA carriers. With the cost of deploying a network today "literally one-hundredth of the price" it was 10 years ago, Platts says waiting a little longer would have significant financial benefits. "The longer they wait the cheaper it's going to be for them to make the change," he says. Bell and Telus could potentially begin deploying a GSM-based network a couple of years from now, but according to the NBI Canada analyst, they aren't likely to duplicate a network that is already available, namely Rogers' HSPA network. As buzz continues to grow around future technologies such as Long Term Evolution (LTE), the two carriers could be looking farther out rather than for a quick network fix. Platts suggests LTE might be more attractive to Bell and Telus as opposed to continuing down the EvDO evolution path. LTE was given a major boost last month when a who's who of the wireless industry announced plans to bring the technology to market quicker. Nokia, Ericsson, Alcatel-Lucent, NEC, NextWave Wireless, Nokia Siemens Networks and Sony Ericsson said they would license their patents on fair and reasonable terms, which should help lower the cost of devices and network gear, while speed the adoption of the yet-to-be commercialized technology. But there is a wild card that the CDMA carriers can play, says Platts. WiMAX is a technology that is very flexible and can run over multiple frequency bands. Sprint-Nextel CEO Dane Hesse said during the company's fourth-quarter and year-end financial results conference call in late February that it plans to introduce a device embedded with both CDMA and WiMAX chipsets. The device's introduction is supposed to coincide with Sprint's launch of its mobile WiMAX service XOHM. Spectrum auction not a panacea for competition Industry Canada will undertake its fifth spectrum auction later this year. Nearly 30 companies have put down deposits but that doesn't mean they will all bid or even win spectrum. Platts suggests that even if new players enter the market as a result of winning spectrum in the auction, we shouldn't expect a dramatic change in how services are priced. "If people are expecting some white knight to come out of the wood work and offer some fantastic service at less than everybody else, they're whistling Dixie," he says. "It ain't going to happen." To read the first part of RoW's interview with Platts, click here.

Bell and Telus may switch to GSM by 2010: Analyst

News | May 1, 2008

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