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After physical wires, the other major way to move information is through the airwaves, a natural resource with enormous potential. But that potential is untapped because of a false scarcity created by bad government policy.

Our current approach is a command and control system dating from the 1920s. The federal government dictates exactly what licensees of the airwaves may do with their part of the spectrum. These Soviet-style rules create waste that is worthy of Brezhnev.

Many “owners” of spectrum either hardly use the stuff or use it in highly inefficient ways. At any given moment, more than 90 percent of the nation’s airwaves are empty.

The solution is to relax the overregulation of the airwaves and allow use of the wasted spaces. Anyone, so long as he or she complies with a few basic rules to avoid interference, could try to build a better Wi-Fi and become a broadband billionaire. These wireless entrepreneurs could one day liberate us from wires, cables and rising prices.

Such technologies would not work perfectly right away, but over time clever entrepreneurs would find a way, if we gave them the chance. The Federal Communications Commission promised this kind of reform nearly a decade ago, but it continues to drag its heels.

In an information economy, the supply and price of bandwidth matters, in the way that oil prices matter: not just for gas stations, but for the whole economy.

And that’s why there is a pressing need to explore all alternative supplies of bandwidth before it is too late.

Not a new one, but still the most wonderfully dangerous idea in telecom. Set the airwaves free.

Link

Not big enough apparently. It’s a up day on the TSE but Rogers is down TSE:RCI.B almost 7% today to 34.96 (and way off the year high of 52) on weaker than expected earnings. Some weakness. Rogers earned a respectable 301 million in profit driven by contribution from the wireless segment. ARPU (average revenue per user) rose to a nose bleed $75 accounting for an overall growth in revenue and also thanks to increased data/SMS use. Total wireless revenue was just north 1.5 billion. To put that number in perspective, the entire billion Rogers just spent on spectrum was equivalent to only two months revenue this quarter.

But it was growth as measured by new subscriber additions that missed expectations leading the market to think that penetration growth in Canada is slowing down. Funny how $75 ARPUs will do that.

Could it be that Rogers own high pricing is chocking off their revenue growth prospects. Shareholders and analysts seem to have been disappointed that the outlook won’t let them have it both ways, new adds and ARPUs increasing together forever…

The other side of price elasticity was also suggested by the one bright spot of the wireless numbers. Rogers substantial data revenue growth year over year correlates conspicuously with Rogers dropping their data pricing from a shockingly egregious national travesty just a year ago to merely “among the highest” in comparison to the rest of the world today.

Rogers confirmed (as predicted on this blog) that iPhone subscribers will come in above the existing subscriber base average of $75.

More earnings season coverage to come on WirelessNorth.ca

Paul Golding has a great presentation on the coming evolution of rich mobile applications. Anything you would care to add?

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You may have heard of this one already, but Rogers is limited time offering of a $30 data plan for 6GB of usage. That’s a lot of usage. That’s 18 times more data than a comparable $30 for 300MB with Rogers offers on the blackberry. And even at high speeds, you’re going to need to do a lot of streaming, or torrenting or something, to hit a 6GB cap on a mobile device. Remember this is the plan that came of all the outcry created all over the press, the internets, and here too, over Rogers steep rates for the iPhone 3G. The 30/6GB plan is the one limited time only concession to the haters and pent-up frustrated Rogers customers out there.

There’s more than a few catches. But here’s why the catches don’t really matter:

Catch 1: it’s only on a three year plan. But the good news, the cancellation penalty for data plans is only $100 anytime in the next 3 years.

Catch 2: the plan goes away August 31st. We’re going to go out on a limb here, and suggest that Rogers is not going to come out with an even better offer the day after. More like the opposite.

Catch 3: You can’t even get an iPhone 3G or Blackberry Bold or other next gen 3G device yet to make it worth while. Ya, but you could get one later and hold on to the 30/60GB plan when you do. Ideally, you could go through all sorts of devices in the next 3 years but hang on to the 30/6GB plan if it’s still the best out there.

Catch 4: More competition is coming in just a year and they may have great offers too. Or they may not. 30/6GB is pretty cheap for data and after paying off industry Canada, your new entrants may or may not be able to beat it. And then cancellation only costs $100 and you can still say bye bye Rogers.

Last catch: the charge is not $100 if you are also canceling a voice plan or other contract at the same time. In that case, according to the fine print, you could be on the hook for a standard $400 contract penalty PLUS the $100 data plan cancellation charge. Ouch. So if you might want to get out of it, this offer is best if NOT switching to Rogers for the first time and/or signing up for a whole new phone with it. Question your CSR carefully about that one.

The plan doesn’t work for data cards (too bad) but it is good for any smartphone including current/future blackberries if you have a personal blackberry as opposed to enterprise (gotta keep milking those enterprise clients). We’re unclear on thethering with this plan, that would be wonderful to get away with, but we’d say don’t necessarily get your hopes up.

Anyway if you are an existing Rogers Customer, or not otherwise signing up for a new 3 year voice contract, you might want to jump on this. This little plan could be like the next mythic legendary grandfathered $20 fido unlimited offer that a select few locked in to and hung on for years.

Recommended.

We should all protest Rogers more often…

For Canada’s “Innovating for Life” wireless, cable and internet company I feel it would be really nice if, one day, they heard of Firefox and if large areas of the Rogers website actually rendered on this browser. Just a pet peeve with the Rogers.com site that’s been driving your editor mildly crazy for about 3 years now.

41% of web visitors to WirelessNorth.ca use a firefox browser.
39% use some variant of explorer against all good sense and reason or, more commonly, because your IT department hates you (your IT department is using firefox)
8.5% use safari which is just fine

more hard-hitting news to continue any minute now.

Well it’s finally done. More detailed analysis to come, but here’s your quick download of Canada’s 4.25 Billion Dollar AWS spectrum auction:

Top Bidders:

Rogers: Big red was the biggest spender in this auction going right to the precipice of 1 Billion dollars to take almost the entire A block, 20MHz of new spectrum coast to coast.

Bell/Telus: Between them Bell and Telus split the E and F blocks for 30MHz of contiguous spectrum nearly in every province with exception of Manitoba and Saskatchewan where only Telus won spectrum. These two are expected to continue their network sharing arrangement to exploit this new AWS spectrum nationally.

Quebecor: (aka Videotron) shut out all the other new entrants in Quebec to take all 40MHz of set-aside spectrum. Quebecor gained a foothold outside of Quebec with 10MHz across a good part of southern and eastern Ontario (including Toronto). Quebecor and Globalive are likely to be partnering to build out a national network.

Globalive: Winning 10MHz in every province except Quebec, Globalive (Yak) is your new national cell carrier. They also landed a little extra, 20MHz over Toronto which they’ll no doubt put to good use.

Shaw: Shaw landed 20MHz of the West from BC to Manitoba, the exception being only 10 in Saskatchewan. What they’ll do with it, or how aggressively they’ll roll out services remains to be seen.

Manitoba Telecom (MTS): After almost backing out entirely MTS hung on to 20MHz in Manitoba, more than enough to be a regional player in the cell phone business.

Sasktel: finished by fighting off nearly all comers to take the largest share (30MHz) of wireless space in Canada’s most trapezoidal province.

Data A/V (DAVE Wireless): John Bitove‘s scrappy wireless startup grabbed 10MHz in Ontario and nearly the breadth of BC and Alberta.

Bragg: Bragg is the last big winner and set themselves up to be big player in the east with 30MHz across all of atlantic Canada and, interestingly enough some small outposts of spectrum in northern Alberta. We understand there’s a more than a few east coasters in them oil fields these days.

Read also: Every thing you need to know about Canada’s AWS spectrum for more on the spectrum licenses, the special rules for new entrants, what 10MHz is good for etc.

This is huge news for the wireless industry in Canada. We are hearing strong rumours than both Bell and Telus will be switching (or at least launching) an HSPA (GSM) network in Canada by 2010. You heard it here first. Rumours and speculation about the switch have been swirling for a while, but this time it looks like it’s for real.

Ever since they purchased FIDO and became Canada’s only GSM carrier, Rogers has been holding it over and winning customer and revenue share from Bell and Telus. GSM phones are increasingly becoming the world standard with only Bell, Telus, some of the larger US carriers and a few others internationally are the last significant holdouts. Increasingly high end phones are coming out only on GSM (like the nokia n-series or the iPhone) or the CDMA equivalents may come out only 6 months later.

GSM also has the handy feature of the SIM card, making it much easier to buy and sell unlocked phones or move devices between carriers.

We had thought that Bell/Telus would try to coast it out for 4G aka LTE sometime in 2012. LTE is the global industry’s plan to finally converge on a “single” 4G wireless standard. It seems though that Telus/Bell couldn’t wait and they will be migrating to LTE by way of HSPA.

Suddenly, that 30MHz or so of combined national spectrum that the two are bidding on seems like it could become an awfully handy way of switching horses.

In addition to the new entrants, having two more incumbents move to GSM inevitably will create more competition through better access to high-end devices, as well an easier ability for subscribers to switch carriers (if not for those 3year contracts).

We at WirelessNorth.ca welcome all our new GSM overlords. We love the smell of competition in the morning.

^{All links to wikipedia, invariably useful if ever you need help decoding the acronym soup of wireless standards.}

“oppy69″ writes:

I heard on Business News Network that Globalive was pulling out of the auction; anybody hear this? Is that possible at this stage of the game without severe financial penalties

The WirelessNorth.ca magic eightball says “signs point to no”. Globalive’s own CEO Anthony Lacavera had even stronger words, from the National Post via the Windsor Star [Rogers boosted by rumours of Globalive ditching spectrum auction]:

…any rumours suggesting his company would pull out of the auction after committing more than $423-million in an attempt to become Canada’s fourth national carrier are categorically false.

“We are absolutely not exiting the auction, we are fully in the auction,” said Mr. Lacavera. “It’s an extremely low probability at this point that we wouldn’t have national coverage with the exception of Quebec.”

As to the second question, if Globalive exited the auction today they would face $10,000 for each bid withdrawal 28 licences x 10k = $280,000. Which isn’t too much compared to the 443 Million they are in for already. Globalive would also be liable for any difference between their currently standing high bids and what those licenses ultimately sell for if bought up by other bidders (up to the full 443Million if no other new entrant stepped up).

If you look at the recent activity it’s highly unlikely that Globalive would choose now to back out. 95% of spectrum has been sorted out now for nearly two hundred rounds.

If anything, what explains the recent quibbling over small licenses is a quirk in the governments spectrum rules for “national new entrants”. National new entrants gain an extra 5 years of mandated roaming on incumbent networks IF they meet certain 5year rollout requirements of their own and, if they cover some spectrum over *all* of Canada. National new entrants are defined as:

“A new entrant that has acquired licences for all Tier 2 or Tier 3 service areas, or a combination of Tier 2 and Tier 3 service areas, covering all of Canada in the AWS or PCS bands. This definition includes a group of new entrants collectively holding all Tier 2 or Tier 3 service areas, or a combination of Tier 2 and Tier 3 service areas, covering all of Canada in the AWS or PCS bands and cooperating to provide a national service.”

So new entrants can team up to form a national service, as long as together they can stitch up coverage across the whole country. This of course creates an added (and unitentional?) incentive for regional players to monopolize any local swath of spectrum to enhance their negotiating position in any future hook-up. This in turn helps explain where the 4.2 billion came from and bickering for Moose Jaw, Coburg etc.

At the least, expect Globalive and Quebecor to be partnering nationally when all is said and done.

So Rogers stock was up an astonishing 11% today, partly on the rumour. The market is putting a heavy weight on the outcome of these auctions. But note also that following the wild swings of the last few days, a lot of stocks were way up on the TSE today. Tomorrow is another day.

Click for a larger version, it hardly fits on the blog anymore.

No that’s not a typo, we’re at round 298 in the spectrum auctions. Though you can see the major hostilities ceased 100s of rounds (weeks) ago, it’s as though some participants just don’t want this thing to end. Funny that.

We’re still looking forward to soon, someday soon, to this thing ending and being able to give you the final perspective on what we think it all means.

then it’s time to get ready and lobbying for Canada’s next big wireless auction the 700MHz band! Woo, better start saving up your loonies, quarters for that one.

Intel has big ambitions for the wireless world. Four years ago, intel effectively conquering home and local area networks by pushing open standard wifi in every “centrino” branded laptop. It turned out that powerful (for their day) low powered cpu’s coupled with wifi was the killer app that has resulted in explosive growth of notebook sales and the popularity of wifi-equipped coffee shops everywhere.

Intel Centrino 2 platform, codename “Montevina”.

With today’s launch of the Cetrino2 brand, intel would like to duplicate that success by now revolutionizing mobile broadband as thoroughly as they revolutionized local networking. With Centrino2, Intel will be introducing several important changes focused on mobility. Intels Pentium M processors are getting physically smaller and dropping in power from 35 to 25 watts (making thin/light form factors like the macbook air soon to be more common). And most importantly, Centrino2 is (supposed to) contain Wimax built-in as well as Wifi. Intel would like wimax to be the big selling point. They would like every Centrino2 to be capable of that great dream, ubiquitous fast internet connectivity. Intel would like this to be the next killer feature in computing that sells a lot of chips.

However, as with any of us, intel would “like” a lot of things. Unfortunately, liking alone won’t always make it true. Although intel’s platform is being “released” today, the Wimax components have been delayed (again) until sometime mid-august. Next there is the little problem of what network those wimax radios will connect to. At the moment Wimax only have about 2 million subscribers worldwide (whereas mobile/celular carriers have, like, a lot more). Europe is pretty keen on GSM/HSPA/UMTS instead. The technology does looks like it could be slowly getting some traction in Asia/pacific and developing countries. In the US Sprint/Clearwire will (finally) be launching something soon [Sprint CEO touts WiMAX, calls for end of "walled gardens"].

But then, there is a final concern as to whether the technology actually works well enough. Depending on tower density and signal strength, Wimax may not be so good at penetrating indoors (if recent experience with older hardware, pre-mobile-spec psuedo-wimax etc., bell/rogers “Portable Internet” is any guide). Having to hold your laptop up to the highest window in your house to get a decent signal may not be your preferred usage scenario.

As earlier reported on WirelessNorth.ca, Canadian carriers Bell and Rogers announced at their recent earnings call that they do not have plans to invest further Wimax. They will keep their existing networks operating just in case (or so Industry Canada doesn’t take the spectrum back), but are both preferring instead to spend future capex on more carrier-friendly HSPA and/or LTE/4G technologies.

So how could we see real centrino/wimax-powerd “3rd pipe” mobile-broadband competition in Canada? Well, most all of the working wimax spectrum in Canada is owned by… you guessed it… Rogers and Bell.

As computers get ever smaller and more connected and as phones get ever smarter and more like computers, there is bound to be a collision somewhere in the middle. As with networks, big internet and computer brands (Intel, Google, Microsoft) are working hard at blasting open wireless connectivity (as free and open as possible) as all the better playground for selling their softwares, webservices and chips.

For the incumbent providers of mobile devices, it’s clear that the barbarians are the gates. It’s just an open question yet as to whether they can find the door.

Earlier on WirelessNorth.ca: Bell Pushing Cottage-Country “Wimax”