Wirelessnorth.ca

As of 2010, Canadians pay the highest mobile bills in the entire world. Released earlier this summer, WirelessNorth.ca got our hands on the latest global telecom report from BofA Merril Lynch. The report itself (with data from Q1 2010) is a blockbuster, wealth of information on wireless carriers around the world and we’d encourage you, and especially the good folks at Industry Canada to take a look.

Surveying more that 50 developed and developing countries where information is available, one country comes out on top when it comes to the most revenue extracted per subscriber on a monthly basis. And that country is of course Canada. What you are looking at here are the world rankings of mobile ARPU (Average Revenue per User). To you and me ARPU is your monthly bill, before GST/PST/HST etc. (through taxes and high spectrum license fees, our government is culprit here too)

This data is total bill including both voice and data. Canada does not have the highest proportion of data to voice charges though data usage in Canada is growing fast (we’re finally catching up after a late roll-out of 3G compared to many countries). Interestingly, Canadians are estimate to pay slightly less per minute of voice (10 cents vs 11 cents) on average than our nearest neightbour the U.S.. What is really driving bills in Canada over the top are the egregious fees like system access fees (the fees many plans still pay whether you access the system or not in a month), and especially “value pack” fees like 15$ a month for the luxury of call display and handful of voice mails.

Now don’t get us wrong. We at WirelessNorth.ca are ardent technophiles and capitalists. We’d love to see every Canadian tech company besting the world at making money and being successful. But telecom itself is a special case. There are enormous positive economic externalities to every other sector of the economy that come from having ubiquitous, high quality and affordable access to telecommunication services.

Wireless subscriptions are nothing less than the basic infrastructure, the plumbing, roads and bridges that drive the digital economy. And this is exactly where high, unaffordable-to-many wireless services will hurt Canadians and hurt the rest of Canada’s innovation economy:

While we’ve seen a ton of improvement in wireless services over the last few years, we still suck at penetration. High costs of both basic and advanced services are keeping many Canadians un-connected. Taking one more look at the data, we can scale our USD ARPU data by relative USD GDP per capita to get a better perspective on shape of the demand curve for mobile services:

What you see above is that as average affordability improves, penetration increases significantly. Countries with perhaps poorer land-line telecom tend to cluster above the curve (less alternatives to wireless) and developed countries below. It’s interesting to see the U.S. with just slightly better affordability and significantly higher penetration.

One final comment is that there are many countries with similar or worse relative affordability than Canada that have better adoption. These gaps could indicate that other factors like digital literacy are also a factor.

So what have Canadian Carriers been doing with all this excess revenue? One thing is reinvesting it in marketing (not so helpful) by launching a barrage of new national flwanker brands. Another is reinvesting in networks (more helpful). Canada now boast several of the fastest 3G+ networks in the world (faster than even the so-called 4G networks in the U.S.).

What hasn’t changed are Canadian Carrier’s world-leading 3 year contract lengths. But, of late we are seeing evidence of price wars for new client acquisition with more and more aggressive discounts on high-end phone subsidies (very helpful, death to crappy feature phones – so long as you do the math and the teaser pricing followed by 3 years of contract pricing don’t bankrupt you faster than a US homeowner).

This fall, the new entrant carriers are finally hitting full stream, so consumers could benefit if we see an accelerated price war. But even those new entrants have some very expensive spectrum bills to pay off (that’s another whole story).

In the meantime, don’t let the trade associations, or any other industry-fed wags fool you.

It’s 2010 and Canadians pay the highest (%#%@!) cell phone bills in the world.

With six major conference events over 5 days in Toronto, this year’s Mobile Innovation Week is looking solid. Head on over to the official MIW site for more info on each of the events and to pick up tickets.

Great to see this kind of though leadership in mobile coming together in Canada. Recommended.

If you look at it one way, no matter how you get your next smartphone, the the monthly charges are going to cost you approximately the same for the next three years. At a typical $90/month that’s $3000 over three years. You have two choices, you can pay $3000 over three years at the big carriers (maybe somewhat less at Wind or Mobilicity) AND pay for an expensive unlocked phone ($779 for that lovely 32GB iPhone4, and something equally speedy for the next top-end BBerry or Android), or you can save $500 and lock in to a 3 year contract.

The sad fact is that there are no special deals for anyone who opts out of the 3-yr contract and phone subsidy game. If you take service from the big three, you are paying for everyone else’s hefty handset subsidies whether you sign a contract or not.

The contract doesn’t lock you in to using the same phone for 3 years. At least it doesn’t cost you any more to upgrade more often than every three years, and locked phones have nearly the same resale value as unlocked.

It is fun and handy to have a SIM-swappable unlocked phone. But is that worth forgoing $500 in free hardware every three years? For some people, especially frequent travelers, an unlocked phone can be a lifesaver in roaming fees. But then you could get that contract phone anyway and root/jailbreak or trade it in on eBay.

Canada may be renown as the world leader in contract length, but that shouldn’t stop you from taking back what meager compensation you can each time that clock finally does come up. Right?…

Discuss.

Not to mention Vancouver, Montreal and a lot of other great mobile development happening across the country, but it’s great to see Toronto (and Canada) earning some international recognition.

White boards abound, as groups of 20-somethings huddle around computers tweaking software that delivers CNN Money, Time and other tier-one news feeds to the BlackBerry and iPhone.

Only, Polar Mobile isn’t in Silicon Valley. It’s in Toronto. Conservative, cold, conventional Toronto — which is home to one of the world’s biggest clusters of mobile-application companies this side of Silicon Valley.

“It’s very much a hotbed,” said Michele Perras, director of the Mobile Experience Innovation Centre, a non-profit mobile-apps research and consulting organization. Perras estimates there are 200 mobile-apps-development companies in the greater Toronto Area, while another 750 GTA companies now have mobile-content offerings.

Proximity to several schools with world class computer-science and design programs, such as the University of Waterloo and the Ontario College of Art & Design, is one reason for Toronto’s emergence as a mobile-apps hub. Availability of public and private-sector funding is another, as is access to entrepreneurs and engineers who cut their teeth working at or with Blackberry maker Research In Motion Ltd.(RIMM), whose headquarters are just one hour west of Toronto in Waterloo, Ont.

just a few years ago, would you have expected such a headline?

LINK: Toronto Becoming A Hub For Mobile-Apps Companies [WSJ]
Non-paywall version: here

In theory, cable TV is a dead media. We have sufficient technology, today, that we can stream any episode of anything ever recorded, anytime, in real time, and in HD to any broadband household. A few decades from now, this whole idea of only being able to watch pre-selected recorded content at certain hours of the day is going to seem awfully strange and quaint. Not to mention the bizarre ritual of millions of subscribers manually making millions of copies of that content on their PVRs when perfectly good original copy already exist on the cloud.

Now in reality, traditional cable/satelite tv isn’t going away anytime soon. The service is reliable, it offers an important easy/lazy level of usability that pc-based alternatives haven’t nearly matched yet. But clearly the writing is on the wall. And services like netflix streaming, and boxee, and youtube, and many others are closing in.

BUT! great news for endangered cable executives everywhere: guess who controls all of the last-mile internet pipes in North America? It’s like having foxes as the sole provider of the chicken pipelines.

Even Michael Hennessy Telus’ top lobbyist has been sounding the alarm that the real net neutrality issue isn’t net neutrality, it’s vertical integration. This concerns, because Telus doesn’t have the same media assets as Bell and Rogers.

When companies with substantial media assets and huge legacy distribution businesses (a.k.a. cable tv) also own the only pipes into your home, it would be crazy not to expect them to use every available lever to favour their own content stack over any others.

And so on the eve of netflix coming to Canada, Rogers cuts their broadband caps (again).

Rogers “extreme” cable option is advertised as 15 Mbps with an 80GB cap at $60/month before taxes and other fees.

For the record, at full theoretical advertised speed, 80GB would earn you 12.9^* hours of usage a month, or just under 30 minutes of usage a day.

^{80GB = 696,320 megabits / 15 megabits per second / 3600 seconds in an hour = 12.9 hrs}

ps. why would this apply to wireless? Well for one it’s all the same players, for another tv and video streaming can be wireless too, and perhaps most importantly all of this logic could apply to separating voice service from wireless pipes as well.

Over the years, we’ve witnessed many desperate ways to stay connected from the woods, from expensive and slow wimax boxes bolted to trees, ziplock-bagged rocket sticks hoisted up flagpoles to, horror of horrors, surfing the internets exclusively by blackberry web browser.

This summer is different. This summer at WirelessNorth.ca’s secret floating headquarters, deep in Canada’s cottage country, we’ve got ourselves a Bell Turbo hub. The turbo hub is a 3G modem, wifi router, and several things all rolled into one shiny box. A bunch of carriers are selling them. Rogers calls it a “rocket hub”. In this case, the choice of Bell came down to testing some convenient Bell and a Rogers sim cards. In our particular location, Bell signal strength is consistently the strongest. Your mileage may vary. (Also remember that Bell and Telus share the same 3G/HSPA+ network so those two should be as good as the other).

The Bell/Ericsson Turbo hub is great! Dead sexy device (if not very woodsy-looking) all dressed in death-star black. And it does exactly what it says on the tin. You just plug this one device and one cord into the wall, and bingo you’ve got an active internet hotspot. Your network starts with WPA security by default, with the network code printed on the back of the device (protip: case-sensitive).

The thing also has jacks for everything: 4 wired Ethernet ports, usb port for network storage, phone jacks for some kind of phone service. All that’s missing is a partridge in a pear tree. But, for most people, 3G to wifi hubbing is probably what you are buying it for.

For basic connectivity, the big advantage of a hub vs tethering or a stick is that it allows more that it connects several devices (the whole household) instead of just one. The main disadvantage is that it’s tethered to the wall and doesn’t fit in your jeans. [whoa, Is that a rocket hub in your pocket or are you... etc.]

But here’s the kicker. Like most data devices still out there, the Ericsson hub only supports 7.2MBps 3G. 7.2 3G isn’t terrible, you’ll see effective speeds close to that of 5MBit DSL but with somewhat higher latency. But it’s a shame because 7.2HSPA is only one third the speed of what Canada’s networks are actually capable of. But it’s a shame because 21.6 HSPA devices (only usb sticks for now) have turned to be so surprisingly awesome. The difference in speed is very much noticeable. For this we must give the hub one hammer.

For a company that makes almost all it’s business from cellular infrastructure, it’s a puzzle that Ericsson’s own devices can’t use to the network to it’s fullest. Nonetheless, the product is a pretty good connectivity option and it beats climbing a tree with a coathanger and a blackberry in your teeth. Recommended.

The Good Easy to set up Lots of ports: phone, usb storage, ethernet Does everything but make you breakfast Good wifi performance The Meh 7.2 MBps HSPA The Hammers IF ONLY it supported Bell’s network at full speed 21MBps HSPA+ it would be perfect Breakfast not included

Back in June Industry Canada sent our fine blog an invite to participate in the consultation for Canada’s digital strategy. Being the opinionated sots sorts that we are, were (http://de-en.gc.ca/submissions/“>amongst many others) were happy to help out. A few of our ideas:

• Addressing some remaining sore points in Canada’s mobile services: international roaming and Canada’s world-leading contract lengths.
• Do not let future spectrum auctions act as a deadweight tax on connectivity: Reinvest all spectrum proceeds back into Canada’s digital economy
• On not feeding the dinosaurs: be wary of legacy business models and interests capturing the digital agenda, actively invest in new models and in disruption
• Invest in policy that enables any/all Canadians to be creators and innovators
• Waive tax on the pipes: Exempt wired and wireless data service from GST/HST
• Establishing better metrics and targets to measure Canada’s digital competitiveness

LINK: Read the full text here

Drawing a card from the world of packaged goods, Canadian carriers are fighting toothpaste style wars for mind share and shelf space. You may have noticed toothpastes, energy drinks, shampoos and snack foods all come from mostly the same few producers, with at best only slight variation in actual ingredients. What you do in a maturing to saturated market is you compete on essentially-meaningless brand and product innovation, using sheer variety to elbow your competitors out of their shelfspace and mindspace.

Now combine that with the Canadian wireless industry. Canadians love to hate their carriers. There’s always an attractively large segment of subscribers ready to switch, churn or sign up for the first time. Meanwhile Canadians know new carriers are launching and have pent up demand for new choices. New choices the entrants thought they were going to have for themselves.

And so the news:

Rogers Communications is launching another wireless discount brand, named Chatr, to compete with new carriers Wind, Mobilicity and Public Mobile, sources say.

Chatr’s main purpose will be to match new entrants with lower prices and cheaper phones without diminishing the quality appearance of Rogers’ core brand, according to a source with Rogers who did not want to be named.

Now with Chatr, Rogers can surgically target the very specific geographies wherever the new entrants launching and undercut, or just out-market the upstarts with their own fake-new brand.

By opening up the industry to new entrants, Industry Canada’s goal was to drive competition. No doubt they were hoping to spur such competition by price, service quality and transparency more so than by marketing spend, general bamboozlement, and geographic discrimination.

Things could get interesting for consumers if Rogers adopts an aggressive enough scortched-earth strategy in key markets. At least for a few years, until the entrants are driven out or bought-up after their five year licenses are up. Building new national brands from scratch won’t be cheap or easy for Rogers^*. However, all incremental consumer acquisition, or just consumer confusion, is a win and drives up the brand-building costs to new entrants as well. Love it or not, Chatr could work. Let’s see what Chatr Rogers has to offer.

LINK BGR: Rogers to launch Chatr, a new low-end brand to compete with WIND
LINK CBC: Rogers launching another wireless brand

^* Though can’t be as expensive as spending a billion dollars on the biggest share of AWS spectrum and then not even turning it on.

The great white north recently got a little bit wireless-lessier, even if it is just south of the 49th parallel for now.

For half a decade, airlines have been farting around with trying to get internets on aeroplanes. Well Air Canada has at last achieved the perfect trifecta: Airplane AND wifi AND power plugs. At least over the US for now. This is posted somewhere over the desert, costs $10 for 600kBits/sec effective bandwidth. Ok so you won’t winning any fast twitch online games from the sky, but for than work purposes, more than effective.

Ten bucks is not a terrible price to pay (you’d pay a least that in lattes anywhere else for 4-5 hrs of inter netting). We approve. And the world is one more step closer to total ubiquitous connectivity. Three cheers for “cloud” computing. At this rate, someday you might even be able to stay connected in absolutely crazy places, like the in any of Canada’s subway tunnels (used by millions every day). But we digress.

Anyway, good job Air Canada.

Previously on WirelessNorth.ca: Woo! AirCanada bringing in flight wireless

Hang on to your hats, we have not one, but two great event deals for you today:

WirelessNorth.ca is proud to partner with Interactive Ontario for the Toronto iP3 Forum June 21. The WirelessNorth community receives a 30% discount off registration.

Join 200+ executives, entrepreneurs, developers, designers, engineers, marketers, and other members of the mobile and digital industries June 21 for Interactive Ontario’s first-ever one-day Forum devoted specifically to the business and technological impacts of Apple’s Touch Platform.

Keynote speaker Ajit Jaokar, Founder of futuretext, UK, will kick-start the day with a mind-expanding talk titled “Invisible Touch: The Invisible Impact of Apple’s Platform” where he will tell us what the real opportunities are for designers, developers and business thinkers; those opportunities that we’re just not getting yet.

LINKS: iP3 Event Info – iP3 Registration

WirelessNorth.ca is an advisor to Jumpwire Media the presenters of CrossMedia TO, a half-day session happening on July 21, 2010, at MaRSDD in downtown Toronto. Use Registration Code: WIRELESS2010 to get 15% off.

Here’s the scoop on this event:

Cross Media TO 2010 features an all-star line-up of industry executives and technology experts. Our goal is to bridge the gap between the different media sectors in order share information and find new opportunities. We want the gaming people to meet the TV people, the publishing people to meet the web video people, and everyone to meet the advertising people but let’s be honest, in the end, it’s all about the money. Headline speakers include Lisa Charters – SVP Director Digital for Random House of Canada, Sabrina Geremia Head of Agency Relations for Google Canada, Pete Watson – Senior Business Development Manager for RIM and Steve Pratt – CBC’s Director of Digital Music. Other special guests include Chris Van Noy – Akamai’s Chief Strategist, and Dr. Siobhan O’Flynn – Transmedia Consultant.

LINK: Crossmedia info and registration

Get to it. I am expecting you all to be mobile media geniuses before the leaves hit the ground.