Small operator Mountain Cable faces unique challenges in introducing VoIP

As a smaller-sized cableco, Mountain Cable in Hamilton insists that it faces unique challenges in introducing Voice over Internet Protocol (VoIP) service, particularly in spreading capital expenditures over fewer subscribers than larger TV distributors. But Pat Kiely, director of business operations and development at Mountain Cable, says the company has no choice but to take the plunge because "it represents part of our survival as a business." Speaking October 20 at the GTEC conference in Ottawa during a session on VoIP, Kiely noted, "I think the thing that’s the challenge for us is that we can’t afford to make the mistakes or the guesses that larger operators can. My costs are every bit as great for me when I start populating my headend with voice equipment as they are for Rogers in Toronto. But Rogers in Toronto gets to play around with that investment and amortize it over a million or two million users. I get to do it over 38,000 users. That multiple is frightening. It means my cost per unit is huge and I can’t make mistakes." Kiely added that Mountain Cable simply can’t imitate what telcos are doing, but must provide additional unique services. For example, video could be pushed to a special device built into a refrigerator, or web pages could be pushed over Internet lines that can be shared with friends while they are discussing them over the phone. He cites examples of collaborative web sharing such as friends discussing buying tickets for a local show as they look at a seating arrangement plan for the theatre, or simultaneously viewing movie trailers while talking as other examples. "I think what you’re looking at in the long run, or taking a distant view, is that voice applications using IP and riding on broadband opens up so many opportunities to do things differently," he said. MTS Allstream executive VP of marketing and business development Ron McKenzie agrees that to compete with Bell Canada and TELUS Corp., it’s necessary for cablecos to offer full-service local telephony with additional features such as visual call waiting or integration with email. MTS Allstream is providing the backbone for Mountain Cable’s foray into VoIP. Mountain Cable is the first customer to adopt MTS Allstream’s Network Resident IP Telephony service. Kiely told Canadian Communications Reports that the solution has been tested to ensure that the technology works, but that it had not yet been tried by actual customers. He added that Mountain would use MTS Allstream’s solution to roll out VoIP commercially, but that no firm date had been set for wide deployment. At the Canadian Cable Systems Alliance (CCSA) annual meeting in Toronto last month, McKenzie urged other smaller cablecos to join with his company to take on the incumbent phone providers in the provision of primary line local residential service. "(Local residential phone service) is not a market we’re in, but it’s a market where we want to enable everybody else to compete in that space, and anyone that wants to get into that space is a partner of ours," he said. "We have common enemies - Bell Canada and TELUS." Many cablecos say that they will need to offer telephony services so that they can offer triple-play bundles to compete with telcos, many of whom are entering the TV business. One of two Class 1 cable licences that Bell Canada is seeking encompasses the Hamilton area. For more on MTS Allstream’s executive VP of marketing and business development Ron McKenzie’s presentation before the CCSA, see the October 13 issue of Canadian Communications Reports affiliate publication Network Letter.

Small operator Mountain Cable faces unique challenges in introducing VoIP

Broadcast | October 22, 2004

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