Small wireless players look at new association following CWTA exit

The departure of three new entrants from the Canadian Wireless Telecommunications Association (CWTA) may lead to the formation of a new entrant wireless association, said chief regulatory officer at Wind Mobile Simon Lockie. DAVE Wireless Inc.-owned Mobilicity, Public Mobile Inc., and Wind, owned by Amsterdam-based VimpelCom Ltd., announced in a news release Wednesday that they were leaving the CWTA because the wireless association has a “consistent bias” in favour of incumbents Rogers Communications Inc., BCE Inc. and Telus Corp. “The CWTA has gone beyond what I would consider to be positive initiatives of industry alignment, and has taken very active lobbying positions contrary to our interests and contrary to consumer interests,” Lockie said in a phone interview, adding the CWTA has acted as an “apologist” for the incumbents. He said there is value in an industry association as long as it acts in the interest of all members and not just a few. “Since we can’t get that at the CWTA, obviously we’re looking at alternatives including our own association,” Lockie said. Lockie did not say when a new entrant association may be formed though he said it’s something being looked at “very closely.” Wind, Mobilicity and Public Mobile told The Wire Report Wednesday that the decision to withdraw their membership from the CWTA resulted from mounting frustration with positions the association has taken over the past few years. “We feel that there is no point being part of an association that is supposed to represent the interests of the entire telecom industry, but only serves the interests of the big three,” Gary Wong, director of legal affairs for Mobilicity, said in a phone interview. Bob Boron, chief legal officer at Public Mobile, said in a phone interview that no single issue acted as a catalyst for the new entrants’ decision though he said recent CWTA positions on the CRTC’s proposed wireless code of conduct, as well as tower sharing, were factors. He said the CWTA has credibility with policy makers and decision makers though it is more focused on issues that are important to the incumbents. At best, he said, the CWTA has been “silent on the key issues that are important to new entrants, if not actively lobbying or advocating contrary to those interests.” The new entrants and incumbents have butted heads over key policy issues surrounding Industry Canada's upcoming 700 MHz spectrum auction, as well as roaming and tower sharing policies. The smaller wireless players want more spectrum to grow their market share, which Convergence Consulting Group forecasts will rise to 8.1 per cent, or 2.35 million subscribers, by the end of 2013, up from 6.1 per cent at the end of 2012. Two industry sources interviewed on a background basis Wednesday said the association and the incumbents had no advance knowledge of the announcement. One person said the association's membership fees may have played a role in the new entrants' departure. Marc Choma, a spokesman for the CWTA, said in a phone interview that the association found out about the new entrants' withdrawal through the press release issued Wednesday morning. Choma said the CWTA cannot release any financial information about whether the new entrants had paid their membership fees. He said he is not yet sure what the withdrawal will mean for the new entrants' participation in programs that the CWTA coordinates, such as the use of short-code SMS messaging, mobile phone recycling, device theft identification, and amber alerts. “We want the benefits of our programs to be accessible to all Canadians,” Choma said. “It's something we're going to have to look at.” Lisa Papas, a spokeswoman for Public Mobile, said in an emailed statement annual membership fees for the CWTA range between $50,000 and $100,000 per year and are based on the number of subscribers with the company. She said the incumbents pay higher fees and that Public Mobile paid its membership fee for 2013. Boron said the annual fee was a factor in Public Mobile's decision to leave the association in so far as the company was paying money to an organization and was not receiving value in the views being represented. Lockie declined to comment on Wind's annual membership fee though he said the new entrants’ decision to leave the CWTA was not financially motivated. “It’s the principle of the thing, more than the amount,” he said. “It’s the idea of funding someone lobbying very actively contrary to your interests, in favour of the interests of the incumbents.” In response to a question about the CWTA's coordinating role on wireless industry programs, Lockie said the association's remaining members must consider that the new entrants’ voice is not represented. “I think they really have to ask themselves the value of the CWTA, given that it’s not and cannot be considered a wireless industry association,” he said. “It’s just selective membership.” Mobilicity did not respond follow-up emailed questions on Wednesday. In 2011, the company issued a release that criticized the CWTA's position on Manitoba’s proposed mobile phone legislation. “The break-away from the CWTA creates some interesting challenges for the association, and also for a number of government agencies,” telecom consultant Mark Goldberg, at Mark H. Goldberg and Associates, wrote on his blog Wednesday, noting that the CRTC last year relied on the CWTA to lead the development of the program on device theft. “The CRTC and Industry Canada have relied on CWTA to act as a gateway to the entire mobile industry on issues that require a common position or industry-wide action,” Goldberg wrote. In a release Wednesday, the CWTA said the withdrawal of the new entrants is an “unfortunate and surprising” announcement as they were valued members. “CWTA rejects the accusation that the Association represents the interests of only certain members,” the release said. “CWTA has always and will continue to work on behalf of all of its members.” The CWTA said the contributions of Wind, Mobilicity and Public Mobile would be missed and that it would welcome their return in the future. Mark Henderson, president of Ericsson's Canadian operations, chairs the CWTA board. Its vice-chairs are Mirko Bibic, BCE’s chief legal and regulatory officer, Morgan Elliott, a director at BlackBerry, Ken Engelhart, Roger’s senior vice-president of regulatory affairs, Ted Woodhead, senior vice-president of government and regulatory affairs at Telus, and Serge Sasseville, Quebecor Media Inc.’s senior vice-president of corporate and institutional affairs. Lockie, Wong and Boron were also serving as directors on the CWTA’s board, according to the association's website. Other companies represented on the board include Lynx Mobility Inc., WireIE Holdings International Inc., Corridor Communications Inc., Samsung Electronics Co. Ltd., Shaw Communications Inc., MTS Allstream Inc., Google Inc., SaskTel, Bragg Communications Inc., TeraGo Networks Inc., and Huawei Technologies Co. —With reporting by Danika Grenier at dgrenier@thewirereport.ca and reporting and editing by Simon Doyle at sdoyle@thewirereport.ca

Small wireless players look at new association following CWTA exit

News | 04/10/2013 7:53 pm EDT

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