Rogers blocks wireless competitors in NW Ontario

Rogers Communications Inc. has struck a wireless alliance with one of the country’s biggest independent telecommunications companies, once again outsmarting its competitors.

The Toronto-based giant has signed a deal with TBayTel allowing the municipally-owned phone and cable company to extend its upcoming HSPA+ wireless network in northwestern Ontario through Rogers’ system and give subscribers access to a wider range of smart phones.

This follows a similar deal Rogers struck last year with Manitoba’s MTS Allstream.

The partnership helps TBayTel, which has been running a CDMA-based wireless network in the 850 and 1900 Mhz spectrum for years, get a modern broadband network.

“We’ve been looking for right time to move forward,” TBayTel president and CEO Don Campbell, said Thursday. “One of the reasons we’re moving right now is some of the opportunities the new technology brings to wireless broadband.”

Headquartered in Thunder Bay, TBayTel was part of a national agreement with all CDMA carriers, which includes BCE Inc.’s Bell Canada and Telus Corp.

Both Bell and Telus opened new HSPA+ networks last November. However, rather than partner with them — or any of the new wireless entrants who have spectrum covering Northern Ontario, including Wind Mobile of Toronto, Bragg Group of Halifax and Shaw Communications of Calgary — TBayTel chose Rogers.

Campbell said Thursday that he also had discussions with other carriers, but wouldn’t identify them.

But he did emphasize that the deal will greatly benefit his wireless subscribers. The company’s CDMA network is spread out over some 300,000 square kilometers of rocky and wooded country roughly from the Sault Ste. Marie to the Manitoba border. It only has North American roaming capability. Under the deal not only will TBayTel wireless subscribers be able to roam on the Rogers network here, they will also be able to take advantage of Rogers roaming agreements around the world. Leveraging its buying power, Rogers will also help TBayTel get the newest wireless devices.

In exchange, Rogers subscribers will get HSPA coverage across a region where it only had small coverage. The two carriers will still compete for subscribers

“We have difficulty having accessing the latest and greatest [handsets] because of our volumes,” Campbell said. There are only some 200,000 people in TBayTel’s coverage area. The largest city, Thunder Bay, has about half that. Campbell wouldn’t say how many wireless subscribers he has.

But with the deal, “we’re going to get access to the latest handsets and smart phones. We’re going to get access to [Rogers] mobile content, national connectability and probably as important international connectability.”

The deal is similar to an arrangement Rogers came to last year with Manitoba telco MTS Allstream, which is building an HSPA network in that province. In exchange for access to Rogers HSPA network in Winnipeg, Allstream business users will get access to Rogers’ national network.

TBayTel will pay entirely for its new network, which will run as a separate overlay on top of its existing Nortel Networks-based CDMA network. The utility hasn’t chosen a new equipment supplier yet. Campbell said the new network will use the telco’s own spectrum, but he is discussing using Rogers spectrum if needed.

He expects the HSPA+ network to be operational over Thunder Bay, Dryden and Kenora by the end of the year, getting download speeds under ideal conditions of up to 21 Mpbs. Other areas, including certain highway stretches and small communities, may only get HSPA coverage with maximum speeds of up to 7.2 Mbps. By comparison, the existing CDMA-EVDO network gets potential maximum speeds of 3.5 Mbps, and that only covers half of TBayTel’s wireless area.

The first half of 2011 will see the network extended along Highways 11 and 17 and up to Red Lake, Sioux Lookout, Greenstone and down to the U.S. border.

By the third quarter of next year the HSPA network should entirely cover the existing wireless area.

Campbell said TBayTel will not be looking for dual-mode HSPA-CDMA phones. Over time, he said existing subscribers will shift their old phones for new ones.

Iain Grant, managing director of the SeaBoard Group, a Montreal-based telecommunications consultancy, said the deal is good for both TBayTel and Rogers. He noted the deal means Rogers will have seamless HSPA coverage across northern Ontario. On the other hand, he said, Bell will have a gap in its HSPA coverage.

Instead of getting a partnership with TBayTel, competitors will have to build out their HSPA networks to get coverage in the area or sign roaming agreements.

In addition to stinging Bell, the deal might be a blow to Wind Mobile, which is trying to build a national network. Its initial goal is coverage in the biggest cities, but a deal with TBayTel would have cut down its capital expenditure.

Daryl Levy, president of Rogers’ western division, which covers that northwestern Ontario, said his company had limited coverage in Thunder Bay and Kenora. The deal means Rogers doesn’t have to build its network into the region, Levy, said, and will advise TBayTel on the technical aspects of the HSPA upgrade and leverage its buying power when it comes to choosing a supplier.

“This is a tough topography in certain areas,” he said. “It’s not flatland.” But he’s confident the new network will be well along in the fourth quarter. “If we had to build new towers it would be considerably longer.”

Levy also said block new wireless entrants from partnering with TBayTel wasn’t on Rogers’ mind when it sat down to do the deal. In fact initially, he said, the conversation was over a roaming deal, which then expanded. However, he wouldn’t comment on whether he was thinking of Bell, his biggest Ontario competitor.