By Jamie Sturgeon | Postmedia Network | Nov. 18, 2010
Far removed from the marketing carpet bombs new and established mobile operators are raining down on one another in cities across the country this fall, another front is opening up — political and regulatory scraps.
The latest salvo in this emerging battle was fired Thursday when startup carrier Mobilicity filed documents with Industry Canada urging the department to endorse laws recently brought on in Quebec and now tabled in Ontario curtailing what the carrier calls “anti-consumer” behaviour from market incumbents Rogers Communications Inc., BCE Inc.’s Bell Canada and Telus Corp.
“Without government legislation, incumbents will continue to avoid competition by employing ... anti-consumer tactics,” Toronto-based Mobilicity wrote in a letter to Industry Minister Tony Clement.
Mobilicity, which launched cellphone and mobile data services in Edmonton, Vancouver and Ottawa this week, alleges multiple transgressions from Rogers, Bell and Telus resulting in higher bills for customers, as well practices designed to unwittingly lock clients into longer contracts that remain costly to terminate.
The firm, which launched in Toronto in May as a low-cost alternative to the big three, said it “encourages the government to explore the introduction of consumer protective legislation similar to that enforced by the province of Quebec or recently introduced in the province of Ontario.”
Dave Dobbin, Mobilicity’s CEO, said the firm is rallying behind a private member’s bill introduced by Liberal backbencher David Orazietti in the provincial legislature this week that aims to reduce cancellation fees as well as make advertising and billing more transparent.
The move follows on the implementation in Quebec of Bill 60, legislation that makes similar demands of carriers in that province.
Mobilicity’s letter is the latest in a series of official complaints from new mobile entrants.
The startups, including Wind Mobile and Public Mobile face considerable in-market challenges against their well-entrenched foes, and are looking for any means of “relief,” Lawrence Surtees, senior analyst at IDC Canada said. “They have a number of frustrations.”
So-called “hard handoffs” of calls, where a signal is dropped once a customer leaves a new entrant’s home zone, is another point of contention made by Wind to regulators at the Canadian Radio-television and Telecommunications Commission.
There are no rules mandating seamless call transitions, and incumbents have used that to advantage by advertising that their larger networks experience fewer dropped calls, which is true. Rogers defended itself in a response to the CRTC dated Nov. 12 that its customers faced the same dilemma.
“Seamless handoff is not the norm for roaming arrangements,” the company said. “When Rogers’ customers pass from Rogers’ network to third party networks, their calls also drop.”
Yet Rogers’ launch of Chatr Wireless (and to a far lesser extent, a response from Bell’s Solo Mobile brand) is drawing the heaviest fire. Rogers introduced Chatr in July to directly vie for customers targeted by Wind, Mobilicity and Public Mobile.
Mobilicity and Wind are now challenging the brand’s legality through the Competition Bureau, a process still underway.
“They are not behaving politely, but no one expected competition to be a polite, gentlemanly sport,” Mr. Surtees said of Rogers and the other incumbents, recalling a quote from Theodore Vail, the U.S. architect of the AT&T phone system a century ago.
“He said competition is strife, it’s warfare and contention to the highest degree that the conscious of the contestants or the laws will allow.”
Financial Post
jasturgeon@nationalpost.com
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