Rogers Communications Inc. will start commercial service using the next generation Long Term Evolution (LTE) wireless technology in four Canadian cities by the end of the year, extending it to Canada’s Top 25 markets in 2012.
Nadir Mohamed, Rogers CEO, made the announcement to shareholders at the company’s annual general meeting Wednesday.
Toronto, Montreal, Vancouver and Ottawa will be the initial cities. The carrier will start by using the AWS spectrum it won in a 2008 auction to provide LTE service, which, it claims, will transmit wireless data three to four times faster than existing HSPA+ networks.
“LTE is the fuel that will power Canadian innovation in the 21st Century,” Mohamed told shareholders.
“We’re excited and proud to bring LTE to Canada.”
The decision could mean Rogers will beat Telus Corp. to bringing the 4G technology to subscribers. Vancouver-based Telus
said earlier this month that it will start construction of its LTE network later this year, with commercial service to start early in 2012. BCE Inc.'s Bell Mobility, which partners with Telus in an HSPA+ network, has been silent on its LTE launch plans.
Rogers move not only puts pressure on Bell and Telus, it also squeezes new wireless operators who have AWS spectrum, Wind Mobile, Mobilicity and Quebecor Inc.'s Videotron. They have to decide whether to spend millions to upgrade their HSPA+ networks to the faster technology or put the money to expanding their footprint. Quebecor has greater financial resosurces than Wind and Mobilicity and will likely put up the money to keep pace with Bell.
In making his announcement Mohamed also urged Ottawa to stage a “fair and open” auction for 700 MHz spectrum. That spectrum is highly prized by wireless carriers for its ability to better penetrate buildings and carry farther in rural areas than the spectrum operators now use.
In consultations with the industry for establishing the rules for the upcoming auction, several new carriers have urged Ottawa to either forbid or severely limit incumbent carriers like Rogers from buying 700 MHz spectrum, because they have so much unused spectrum already.
But Mohamed vigorously objected.
“Denying established carriers, with the expertise, national footprint, and large customer base, from bidding on this spectrum is a recipe for leaving Canada behind,” Mohamed said.
“Put simply, we need rules that apply equally to everyone.”
Duncan Stewart, director of research for Deloitte Canada’s technology and telecommunications, noted in an interview that like Telus, Rogers is making sure Ottawa see it will use its AWS spectrum before government sets the 700 MHz auction rules.
“The incumbents are trying very hard to make sure there are no political arguments of, ‘They don’t need 700 [MHz spectrum], they aren’t investing in the future, they haven’t used their AWS frequencies yet.’”
Industry Canada is expected to announce rules for the next auction by the end of the year.
Mohamed said LTE's "blazing speed" is critical to Rogers' vision of bringing the wired and wireless worlds together so subscribers can choose how, where and when to watch content.
While he touted LTE's ability to support downloads of up to 150 Mpbs, company officials wouldn't say what kinds of average speeds subscribers will see until the company's trials in Ottawa are over. Industry analysts have said real world speeds will be about a quarter of the maximum one can get under ideal conditions.
Recently, Network World U.S. tested Verizon Wireless' LTE network in Boston with an HTC Thunderbolt LTE handset and found data speeds averaged between 4 Mbps and 6 Mbps, with bursts over 10 Mpbs.
It’s not that Roger’s current HSPA+ networks is a laggard. Currently its maximum download speed under ideal conditions is 21 Mbps, and the network can be upgraded to 42 Mbps. Telus has already done that. In a question and answer session with reporters, Mohamed suggested that’s coming on his network.
Last year Rogers’ wireless network equipment maker, LM Ericsson, said it was pushing speed at a carrier in Denmark and Sweden to 84 Mbps.
But Mohamed said it would be a challenge to get HSPA+ to 100 Mbps. He praised that technology, but added, “make no mistake the platform of choice going forward, the gold standard, the way the world’s going is LTE.”
Still, LTE subscribers will have to wait a while before seeing the wide choice of devices they have now on current networks. Verizon, for example, can only offer one LTE-enabled handset, three USB dongle modems for laptops and two Wi-Fi hotspots. The Motorola Xoom tablet it sells will be upgradable to LTE in the second quarter.
“It’s going to take a while for the ecosystem to develop,” said Ron Gruia, Toronto-based telecommunications analyst with Frost & Sullivan.
In an interview, Rogers CTO Bob Berner said the carrier has been testing LTE in Ottawa and Montreal since last summer on its so far unused AWS (1700/2100 MHz bands) as well as the 1900 and 850 MHz spectrum it uses for HSPA+. In addition, through a temporary licence from Industry Canada, it has been testing on 700 MHz.
These tests are to ensure Rogers can deploy LTE on all of the spectrum it owns, he said.
Mohamed has told financial analysts the carrier has a multi-band strategy of deploying LTE on as much of its spectrum as it can.
Higher bands have the advantage of more available spectrum, Berner explained, but lower bands – such as 700 and 850 MHz – better penetrate buildings and carry over a wider area.