Bragg to further build network over summer, plans more aggressive marketing

MONTREAL—Bragg Communications Inc. plans to continue strengthening its mobile wireless network in Nova Scotia and Prince Edward Island this summer as it prepares for more aggressive marketing of the service, company chief executive Lee Bragg said. “So far we’ve been very happy with the response in the market. We’re happy with the number of customers we’re getting,” Bragg told The Wire Report in an interview after he appeared for a CRTC hearing on BCE Inc.’s application to purchase Astral Media Inc. Bragg, whose private company operates as Eastlink, declined to discuss subscription numbers for its new wireless service launched in February, though he said there is a “good buzz” about its wireless product in Eastern Canada, where he said there was a need for another player in the market. The company is rolling out third-generation HSPA and fourth-generation LTE wireless technologies on spectrum covering Nova Scotia and P.E.I. that it purchased in Industry Canada’s 2008 wireless auction. Bragg said the company now has more than 200 cell sites running in the two provinces and will continue its build over the summer to match BCE Inc.’s network, as Eastlink plans to more aggressively market its product. “Our goal is to equal or exceed Bell’s coverage, who has the best coverage in the Maritimes,” Bragg said. “Now that we know we have a solid platform, we can become more aggressive. Let’s push it out. We really have not been pushing it very hard from an advertising standpoint at this stage.” The company initially wanted to make sure it had solid customer service, network performance, and billing systems in place before it focused on marketing, he said. “We have an important reputation with our customers in the marketplace, and we don’t want to mess that up,” Bragg said. Jill Laing, a spokeswoman for Eastlink, told The Wire Report last November that the company planned to have 350 cellular sites running for its Maritime network, and that it would provide HSPA and LTE technologies. Prior to Eastlink’s wireless launch, analysts questioned whether the company would provide Apple Inc.’s iPhones, which are not compatible with the AWS band in Canada unless they are newer versions operating on LTE, which is not yet widespread. Quebecor Media Inc.’s new entrant wireless provider in Quebec faces the same problem. Available devices on the Eastlink website show BlackBerry’s Z10, SamsungElectronics Co. Ltd.’s Galaxy S4 and SIII, as well as other Android-based devices, though no versions of the iPhone. Eastlink spent $25.6 million in Industry Canada’s 2008 wireless spectrum auction on AWS licences in the 2 GHz range covering Newfoundland and Labrador, Nova Scotia and P.E.I., New Brunswick, Northern Ontario, Grande Prairie, Alta., as well as Listowel, Goderich, Stratford, London, Woodstock, St. Thomas, Strathroy, and Barrie, Ont. Bragg said the company, after it finishes strengthening its network in Nova Scotia and P.E.I, will decide whether to expand. “Then we’ll make a decision, do we grow it beyond that? What do we do with our systems in Ontario, and areas of New Brunswick and Newfoundland? We haven’t decided yet,” he said. When asked if Eastlink intends to participate in Industry Canada’s 700 MHz spectrum auction coming up in November, he said: “We are interested in 700 MHz spectrum. We will be involved.” Bragg urged CRTC commissioners Wednesday to again block BCE’s acquisition of Astral, as the regulator did last fall due to concerns about market power. He said the company has had a difficult time negotiation for content rights with BCE division Bell Media because it is a competitor in broadcast distribution and now wireless services. Eastlink has not gotten access to Bell Media’s content, including premium sports programming such as TSN, for its new mobile and online TV service, called Eastlink To Go, Bragg said. “We want to be able to offer as much content, as many applications from a wireless standpoint as we do on the wireline side. The fact that we can’t get access to the content, I think that makes it difficult for us to compete,” Bragg told The Wire Report. Bragg told commissioners that if BCE continues to grow in size it would make more sense for Eastlink to "exit early," indicating a possible sale, while the company still has "reasonable valuations." “We’ve not actively been on the market, but I would think we could sell the business to somebody,” Bragg added in an interview with the Financial Post on Wednesday. “We haven’t talked to anyone about it.” Bell spokeswoman Jacqueline Michelis told The Wire Report in a statement this week that its competitors “would rather have regulatory intervention supersede market negotiation” and that the company has offered “extremely reasonable” rates for the on-demand rights to its content. —With reporting by Simon Doyle at sdoyle@thewirereport.ca and copy editing by Nicholas Kyonka at nkyonka@thewirereport.ca

Bragg to further build network over summer, plans more aggressive marketing

News | 05/09/2013 3:17 pm EDT

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