This week, IT World Canada is profiling some of the new faces on Canada's wireless scene who are bidding for radio spectrum in the upcoming advanced wireless services (AWS) spectrum auction. Missed yesterday's instalment? Read it here.
TRIPLE FIVE UNIVERSAL ENTERPRISES
Wholly-owned by the publicity-shy Ghermezian family of Edmonton, this entry is linked to the family’s Triple Five Group, known for its North American real estate investments that include the huge Mall of the Americas in Minneapolis and the equally-sized West Edmonton Mall. Another huge mall is underway in Las Vegas.
It has put down only $11 million for the auction, so the assumption is its going only for Alberta licences.
Though real estate is its signature, the Group and various family members have ties to venture funds with IT investments that give some knowledge to the communications industry. T5 Equity Partners, for example, has a technology division that invests in wireless, cable, telecommunications, fibre optics, networking, Internet and related startups. It can also turn to family member Mark Ghermezian, who was president and CEO of mobile virtual network operator XE Mobile, for advice on the ups and downs of wireless. Targeting college students, his pay as you go firm, backed with family money, opened its doors in 2006 and closed them at the end of last year. Reports suggest it was apparently hurt when other MVNO’s, including Amp’d Mobile and Disney Mobile went under in 2007. Lesson the family seems to have learned: To be successful in wireless, own your own spectrum.
Note: After three rounds of bidding, Industry Canada's Web site shows the Triple Five entry as withdrawn.
How does the auction work?
MIPPS INC.
This small company is actually a big player in Canada, for it’s the way U.S.-owned Primus Telecommunications gets to play in this country. As a unit of a foreign company, Primus Canada, which sells high-speed Internet connectivity to consumers and businesses as well as GSM cellular service it buys from Rogers, can’t own spectrum here. So it works with a Canadian partner, former Rogers executive Joe Boutros.
Through a numbered company, Boutros controls a Toronto CLEC called Globility Communications, of which Primus Telecommunications owns 20 per cent. Globility, in turn, owns all of Mipps. Mipps builds infrastructure for fixed wireless connectivity on spectrum it owns and contracts it to Primus Canada. Mipps is also in the middle of WiMAX tests in Toronto and Hamilton, Ont.
Boutros refused to speak about why Mipps has put down $1 million for the auction. Primus Canada president Ted Chislett was willing to be interviewed, but given government rules against collaborating with other bidders, carefully chose his words. “Ideally, Mipps would be interested in finding a region and building a new (cellular) network there,” he said. After that, Mipps would “hopefully be able to find arrangements with other winners to provide service in a broader area.”
Chislett said the relationship with Boutros began several years ago because Globility had the capability to allow Primus to offer high speed connectivity and local phone service.
“Going into the auction we’ll see if with Mipps we’re able to pick up some spectrum to build out, and see where it takes us.”
Note: After three rounds of bidding, Industry Canada's Web site showed the Mipps entry as withdrawn.
TELEHOP COMMUNICATIONS
One of the earliest companies to provide a long-distance “hop” between Toronto and its suburbs, Telehop is extending its reach into cellular with an $800,000 deposit for the auction.
Founded in 1993 by chairman Hersh Spiegelman, this long distance and directory assistance provider for Southern Ontario and Montreal pulled in $21 million in revenues in 2006 with net income of just over $1 million, according to its most annual figures.
But last year wasn’t stellar, with Spiegelman putting in a new president while he underwent a liver transplant.
According to Stan Katz, a management consultant to the board, the business “stagnated” and profitability started to recede. In February, Spiegelman added the roles of president and CEO to his tasks. Now the company is trying to relaunch its VoIP offering.
Katz, who had worked with the company in 2000, was brought back a month ago and is the spokesman on the auction.
He said he and Spiegelman decided to get into cellular to expand Telehop’s business. “We were discussing the future of Telehop and the directions we could take it, and realized the auction was going to be coming up. So we decided to put in a bid and see what would happen from there.
“It was almost a spur-of-the-moment decision,” he said.
With prices in the Greater Toronto area “out of our range,” Telehop will be bidding on spectrum in smaller Ontario cities, such as Windsor, Kitchener, Kingston and Cornwall.
“We have not much to lose, unless we win something,” he said, “and if we win it the right way we have a lot to gain.”
Note: After three rounds of bidding, Industry Canada's Web site shows the Telehop entry as withdrawn.
More profiles
The Wireless Spectrum Playoffs, Round 1
The Wireless Spectrum Playoffs, Round 3