Atlantic Canada to become more competitive wireless market

The battle for subscribers, both consumer and business, is likely to get more heated in Atlantic Canada following the agreement that sees Aliant Inc.’s mobile operations rolled into Bell Mobility. The move was part of BCE Inc.’s decision to spin off its regional telephone lines into an income trust, a transaction that is expected to close in the third quarter of this year. While executives from both Aliant and Bell didn’t predict any increased competitive pressure on rivals, they foreshadowed the fact by noting wireless is a highly competitive market and economies of scale are required to compete as efficiently as possible. BCE CEO Michael Sabia noted during a conference call regarding the creation of a new regionally focused income trust that rolling Aliant Mobility into the Bell family will allow the Atlantic Canadian wireless business to compete more effectively with the other national carriers. "We think that consolidation and the bringing of that kind of national presence and scale and scope into the Atlantic Canadian marketplace will be of significant benefit to this market and to the competitive position in this market," he said. Aliant CEO Jay Forbes reiterated this point as well, noting that scale is a key ingredient to success in telecommunications. "We came to the conclusion that we would not be able to achieve the scale necessary to keep our wireless business relevant and at the same level of service and innovation that our customers have come to know in the past. So not an easy decision, but we believe the right decision to combine our wireless business with Bell Mobility and enter into a series of commercial agreements that will ensure our customers continue to enjoy the very best in products and services through the Bell Mobility organization," he said. While the removal of mobile operations from Aliant will eliminate a key revenue generator for the company, Bell Mobility will be able to benefit from broader geographic wireless coverage and a larger subscriber base. The larger mobile operation will also be able to bring newer and advanced services to Atlantic Canadians by leveraging product development and other synergies. Aliant Mobility has traditionally been slower to introduce faster networks and advanced wireless applications, and this new corporate structure should reduce the time to market for such services in Atlantic Canada. It’s unclear at this point, however, how quickly an expanded Bell Mobility will ramp up enhanced network deployment in the region to allow for greater availability of new services such as mobile TV. Prior to the income trust announcement, Aliant had announced trials of EvDO in Halifax.

Atlantic Canada to become more competitive wireless market

News | March 22, 2006

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