Wholesale roaming caps won’t solve problem: Wind

OTTAWA — Proposed federal legislation that caps wholesale wireless prices is a good start but “doesn’t solve the issue,” Wind Mobile co-founder and chief regulatory officer Simon Lockie told a Senate hearing on Tuesday. Lockie said the domestic roaming agreement his upstart carrier signed with Rogers Communications Inc. in 2009 in order to provide Wind’s customers with service outside a few major cities was "absolutely terrible.” Provisions in the government’s budget bill, C-31, would cap domestic roaming fees at a rate hundreds of times cheaper than what Wind currently pays, Lockie said. He added that although the terms and length of the agreement with Rogers are secret, his company is paying “some of the most ridiculous rates you can imagine.” Wind Mobile operates its own AWS network in several cities, including Toronto, Calgary and Vancouver, and relies on its roaming agreement with Rogers to provide service outside those areas. At a hearing before the Senate’s transport and communications committee, Lockie said the exclusive agreement was the result of technological limitations at the time that made Rogers the only other carrier capable of using Wind’s handsets. What smaller carriers need, Lockie said, is firm regulation from the CRTC at the carrier level that mitigates the incumbent carriers’ “oligopoly” and as little regulation as possible at the retail level to maintain competition. In an interview after the hearing, Lockie said the government’s legislation, which would cap wireless wholesale rates at about what carriers make from retail operations, isn’t good enough to ensure long-term competition. “The interim measure for retail rates is welcome but insufficient on its own to create that playing field,” he said. Lockie told the hearing that despite Wind’s recent troubles, including its Amsterdam-based parent company VimpelCom Ltd. writing down the value of its investment in the Canadian carrier, the company is in good health and will not bow to pressure from its larger competitors. “They can’t just out-wait us and have a siege mentality and constrain our business model,” he said. “We’re going to be there.” Questions about Wind’s future without changes in regulation were one of the reasons Wind was unable to raise financing to enter the government’s 700 MHz spectrum auction this year, Lockie said. He added that its attempts to raise money were made before the government said it would introduce legislation on wholesale wireless prices and before the CRTC launched its specific review of wholesale pricing and a second, broader review of the wholesale market. When the caps were introduced in this year’s budget, the government said it would be included in the budget bill and would remain in place until the CRTC decides its own regulatory framework. In a May 14 filing to the CRTC in the second review, French carrier Orange SA said it was interested in entering Canada yet “it is unlikely that any new wireless-only entrants will emerge without significant changes to the current regulatory environment.” In its own filing to the CRTC in the second review, Rogers said the Canadian wireless market was already competitive and that price caps were unnecessary and could be counter-productive if they allow network access at unsustainable rates. Last week, Rogers spokeswoman Jennifer Kett told The Wire Report in an email that Wind agreed to Rogers’ roaming rates “five years ago after a vigorous negotiation where both sides gave ground. They did not avail themselves of a mandatory arbitration at that time because they were satisfied with the rates they negotiated.” A public hearing for the second wholesale review is scheduled for Sept. 29, with a ruling in the first wholesale pricing review expected within months. — With reporting by Peter Henderson at phenderson@thewirereport.ca and editing by Derek Abma at dabma@thewirereport.ca

Wholesale roaming caps won’t solve problem: Wind

News | May 27, 2014

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

Wholesale roaming caps won’t solve problem: Wind

News | May 27, 2014

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

FREE TRIAL

SUBSCRIBE

Related Stories

Freedom plans could drive big three back to subsidies: analysts

Freedom answers to ‘unlimited’, offers $0 phones on select plans

Shaw says patience, not regulation, required to see organic MVNO market

Analysts surprised by Bell’s lack of 600 MHz, incumbent spend

Reuse & Permissions

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us