Lack of scale, device lineup challenges for Xplore Mobile

New Brunswick-based internet provider Xplornet Communications Inc. started selling mobile subscriptions in Manitoba this week, with many watching how the small telecom operator will fare competing against larger players. Xplornet started with an existing base of just over 24,000 customers, migrated as part of the final approval for BCE Inc. to purchase Manitoba Telecom Services (MTS), announced in February 2017. Its addition to the deal came as a surprise at the time, though Innovation Minister Navdeep Bains extolled it as a move that will result in more competition in the province. Desjardins analyst Maher Yaghi said in a note this week that the conditions it’s starting under as a result of the MTS deal will help Xplornet with subscriber loading while it builds its own network and increases market competition. But he cautioned that could be limited. “We expect that the launch of Xplore Mobile will increase competition in Manitoba’s wireless landscape,” he said. “However, Xplore Mobile’s lack of scale could make it difficult for the company to compete on the technological and network coverage fronts in the long run, once the remedy period is over.” RBC analyst Drew McReynolds wrote in a Friday note that although “Xplornet pricing appears superior in the Manitoba LTE market,” its lineup of smartphone options is more limited than the competition, given it has no Apple Inc., Alphabet Inc.’s Pixel or Huawei Technologies Co. devices. Ben Klass, a PhD candidate and telecom industry researcher at Carleton University who had opposed the Bell/MTS merger, said that it’s hard to compare Xplore Mobile to MTS, Manitoba’s former locally-based telecom incumbent that had been around for a century, and still difficult know how well it will compete. “Them opening up is better than nothing,” he said. “It’s promising they’re offering some innovative service plans. But we shouldn’t be jumping for joy about the … extent of the competition they’re bringing,” he said. One way the company is trying to set itself apart is by rolling data over into the next month. “It’s a good sign to see them coming out the gate offering something that wasn’t available in the market before,” Klass said, but he noted that with MTS’ absorption into Bell, the unlimited options that MTS offered were taken off the market. James Maunder, Xplornet’s vice-president of communications and public affairs, said that the company thinks allowing customers to roll over their unused data into the next month should be enough to differentiate them from its competitors. “All Manitobans will be able to subscribe to our service,” he said, but because Xplornet is has historically been a rural provider, it will be “especially focused” on Southern and rural communities. “Obviously our heritage as a business is serving rural communities,” he said. Xplornet’s move into mobile included buying six retail stores in the province and 40 MHz of spectrum from Bell, which in turn has to give it access to its towers in Manitoba for five years. Meanwhile, on BCE Inc.’s third quarter earnings call at the start of November, Bell CEO George Cope said MTS will generate $100 million more in tax savings than his company originally estimated, and that it can can use that by end of 2020. — With reporting by Kyle Duggan at kduggan@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Lack of scale, device lineup challenges for Xplore Mobile

News | November 16, 2018

Unlock all the Canadian telecom, broadcasting and digital media news you need.

FREE TRIAL

SUBSCRIBE

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us

Lack of scale, device lineup challenges for Xplore Mobile

News | November 16, 2018

Unlock all the Canadian telecom, broadcasting and digital media news you need.

FREE TRIAL

SUBSCRIBE

Related Stories

ISED starts consultations on right to repair

Eastlink unveils video streaming app

Newfoundland finally gets new area code after six years’ delay

Telecoms file interventions on thousand block pooling

Reuse & Permissions

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us